DEMAND MANAGEMENT IN TOURISM

DEMAND MANAGEMENT IN TOURISM

January 30, 2019

By MASUK UR RAHMAN

Imagine you have a three-days holiday and decided to experience the tranquility of mountains at Chittagong Hill Tracts. Considering the ease of transportation, accommodation and shortage of time, you have decided to make your holiday at Sajek, an all-weather hill station in Kasalong Mountain Range in Rangamati. Your first challenge will be managing accommodation at Sajek. Though there are over 100 cottages in Sajek, you need to book your cottage at least 40/50 days prior to your travel date. Otherwise, you will not be able to manage accommodation in your desired cottage. Second challenge will be managing tickets for Khagrachari. You need to purchase tickets at least two weeks prior to your travel date. These are all understandable since the demand for those services are high during particular dates. However, it will be quite irritating for you to discover traffic jam in the mountain region. There are more than 700 cars, moving towards Sajek in the narrow single lane mountain road and all of them travels within a particular period since Bangladesh Army or BGB provides armed escort services twice a day. After experiencing horrible traffic jam, you can finally experience the intense tranquility at Sajek. Thousands of tourists are there within a limited area making tourist attraction spots extremely crowded. Needless to say, the same goes for St Martin’s Island!

CURRENT SCENARIO OF BANGLADESH TOURISM

Bangladesh has been experiencing a sudden hike in numbers of tourists. With the increase in per capita income, number of domestic travelers are around 8 million; and another 4 million of people are visiting foreign countries. India alone has received more than 2 million of Bangladeshi Tourists and Thailand received more than 7 lacs tourists from Bangladesh. The reasons behind the increase in number of outbound tourists is obviously the hunger to explore a country, a new culture and a different experience with nature. However, one of the reasons behind tourists visiting neighboring countries is the mismanagement of supply and demand of tourism services in Bangladesh. Crowded destination, traffic jam in highways, unavailability of tickets, surcharge pricing during peak seasons are playing the major role behind the increasing number of outbound tourists.

Photo Courtesy: Arif Zaman

We could have expected this scenario if there were shortage of destinations in an over populated country like Bangladesh. However, we have hundreds of destinations that can accommodate the current numbers of domestic travelers in Bangladesh if we distribute the numbers of tourists equally!

For example, in 2018, Sajek and St. Martins have received excessive number of tourists in holidays during the winter. While during the same period, destinations like Rangamati, Kaptai, hill stations in Bandarban, trekking trails in Chittagong hill tracts, marshlands of Sylhet, archaeological sites of North Bengal, southern islands and sea beaches in the coast of Bay of Bengal and even the mighty Sundarbans have received lesser number of tourists compared to the capacity of the hospitality services providers.

This is not a healthy scenario for the industry and the consumers as well. This imbalance in demand has introduced an evil cycle of misfortune for the tourism industry.  Sudden rise in demand results in sudden price hike. Consumers have to pay a lot because of surcharge pricing. This sudden rise in income makes the business entities to invest more in developing the capacity for increasing their income. Since the major share of revenue is generated from holiday travelers, the assets remain idle in weekdays. To minimize the losses, the business entities then keep the price high around the year on weekends to maximize their revenue from holiday travelers. For example, there used to be some 80-100 four wheeler jeeps in Khagrachari carrying local passengers and goods in weekdays but carrying tourists in holidays. However, the sudden hike in number of tourists has placed a demand for more vehicles and people have started investing in vehicles to serve that. Now, there are around 500-600 vehicles in there carrying tourists on holidays. Since the demand for local need has not increase according the demand for the tourists’, the additional 400-500 vehicles than that of previous times remain idle in weekdays. As a result, the vehicle owners have set up a union and decided to charge extra premium on weekends to minimize their losses.

Since the consumers are bound to pay extra due to this policy, they are losing interest in revisiting the same destination and becoming interested to visit other countries.

DEMAND MANAGEMENT IN WORLD TOURISM

To encounter this supply and demand problem of our tourism, it is high time we needed to initiate demand management scheme. Our neighboring countries have already started following this scheme. Our nearest state Shillong limits the number of cars entering into a tourist spot at a given time. Let us assume the number is 100. So, the toll plaza in that place registers the number of cars entering into a tourist spot. Once the number crosses 100, they stop other cars at the gate and wait for other vehicles to depart the place. If five cars check out, they permit another five cars to enter.

Even in Taj Mahal, the government of India has set a limit for maximum number of visitors and increased the entry fee to reduce the number of visitors per day.

In Nepal, you need to purchase route permit from the authority for any trekking routes. In addition, you are bound to purchase food from the localities so that littering the mountains with plastic packages can be minimized.

In Taiwan, you need to book your permit at a given time for visiting natural beauties so that the numbers of tourists can be kept at an optimum level.

This demand management scheme is not only preserving the nature or archaeological assets, but also helping to the businesses to remain healthy all the year. Moreover, this is resulting in destinations receiving tourists even in unusual times. Permit is the key to make holiday in a desired destination; and in case people can’t make it, they can have backup plans to visit other destinations. As a result, no destination gets over crowded or fails to receive lesser tourists than expectation. Taking this into account from the business perspective, it creates a strong entry barrier for the new businesses to enter into the market. So, the new investors tend to consider new destinations rather than entering into a sheer competition with the existing business entities.

DEMAND MANAGEMENT FOR TOURISM IN BANGLADESH

In Bangladesh, we can follow such initiatives with the combined effort from Tourism Board, Local Administration, Law Enforcement agencies, local entrepreneurs and tour operators. Government is already planning to limit the numbers of tourists visiting St Martin’s at a given time – which is an appreciable initiative from the government. We need such initiative in other places too, like in Sundarbans. There is already a ban on tourists in mating season. However, during winter, government must impose a limit on maximum numbers of tourists visiting Sundarbans in particular route or river. It is also necessary to put a limitation on the maximum numbers of tourists visiting a particular mountain region and trail. Apart from this controlling mechanism, we need to promote other places of Bangladesh too. What if local governments from different districts start promoting their places of interest to the tourists from other districts? What will happen if the tourism board encourages business entities to offer discounts and additional facilities in the underexplored travel destinations? These can be significant matters to take into consideration of course.

Our government has arranged a competition among the district administrations regarding their own district-branding. Due to this campaign, we got know about lots of unexplored places, cultural and economic activities that we usually cannot find in the web. However, contents are there to promote each district as a tourism destination and we are yet to see any initiative from the concerned authority to promote tourism.

FACTS ABOUT EARNING FROM TOURISM

It is high time that our tourism board put emphasis on domestic travelers besides attracting inbound tourists. Inbound tourists increase our export income while outbound tourists create import expenditure. The imbalance between export earnings and import expenditures from tourism sector has a great significance in our economy. While we are receiving merely 500 crores from inbound tourists, we don’t have much idea about what we are spending in our outbound tours. This happens because our travelers do not care about mentioning the amount of money they are taking with them for their outbound trips. There is no proper estimation since our tourists sometimes have the tendency to take illegitimate measures for taking currency outside Bangladesh. According to India, Bangladesh is the highest contributor in terms of the number of tourists visiting the country and is the second largest source of tourism income there. We cannot really estimate the amount India alone is earning from Bangladeshi Tourists. Thailand alone receives more than half of a billion US dollar from Bangladesh as export earnings from tourism.

Since we cannot encounter this imbalance of foreign currency earning and expenditure overnight, Bangladesh Tourism Board must take necessary steps to develop our tourism places, initiate demand management mechanism to make traveling a soothing experience for everyone, ensure sustainability of our travel destinations, invest in developing new travel destinations, and facilitate new experience in the tourism industry of Bangladesh.

According to the hospitality services providers, this industry is directly contributing an amount of BDT 5000 crore in our economy. According to World Tourism and Travel Council, the direct contribution from our hospitality industry is around $5.6bn US dollar and the total contribution is around $10.6bn. Now it’s the call to increase the share of our tourism industry. However, this effort should come from a combined force including the tourism board, local government, archaeological department, forest department, Chittagong Hill Tracts Commission, Bangladesh Tea Board, Bangladesh Inland Water Transport Authority, Bangladesh Railway, NGOs, Corporations and hospitality services providers.

The writer is CEO at Ogreem.com.

Reach him through ceo@ogreem.com

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