Early specials – then prices will probably rise

Early specials – then prices will probably rise

Early early birds could be one way to revive cash flow within the travel industry, says Dr David Beirman, a member of PATA's Tourism Rapid Response Taskforce.

‘Maintaining and developing cash flow is a key to survival. The market is familiar with early bird offers so maybe extra early bird offers may work at this stage.’ That said, Beirman, senior lecturer – tourism at University of Technology Sydney, feels in the long term travel sectors will have to take a new look at its profit margins post Covid.

‘Typically airlines and others in the industry have relied on high turnover and low margins, but this will probably have to change. As an industry we have taught people to be price sensitive and to always look for deals.

‘We need to adapt the paradigms because travel won’t keep getting cheaper. Health related concerns will be the dominant issue during coming years. The question is how do we maintain the sociability of travel, without compromising health? We need to restore the reputation and appeal of travel and tourism. Cruise lines, airlines, tour operators and travel agents have all copped a bit of a battering.’

He says many of the new norms, especially at first, will add costs to travel. These include requirements such as no one in a middle seat when flying, cruise ships with more social distancing and sporting events without crowds.

‘Big groups will be replaced by small groups, at least for a year, and mass things won’t be happening easily.

‘This challenges the whole model of volume with low margins. This will come into question after the coronavirus.’

At the beginning of this week’s Tourism Business – Survival, Revival and Resilience to Covid webinar, where Beirman was the keynote speaker, 61% of participants in a survey felt that travel would be more expensive post the pandemic.

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