Tourism #Bankruptcy post #Covid

Slowly we are getting back to our normal daily life and habits. Not like before...nothing will be same as before, after this unplanned, sudden, long temporary stop. In January we started thinking #Covid would effect seriously economy with huge losses in some areas of the world.

Personally I immediately thought it could develop into an immense, catastrophic economical crisis. We started cancelling all optioned services in January, as we could only imagine the amount of problems would have risen if doing it later. Someone laughed at me..someone said...Arianna..it's too much what you are thinking of...it's just a virus like others we had in the past... Of course, in history we met new, several viruses, during centuries, but I was, and I still am, pretty much concerned about my working environment, which is tourism and travel since ever.

Travel moves tons of people a day worldwide, tourism is based on being social, being relaxed and being economically wealthy. From the destinations's point of view and supplier's chain, tourism means incomes, investments and of course also excesses like overtourism, a negative phenomenon, which we were trying (until January) to face and solve somehow.

Now. Let's analyze the situation: the very BIG, BIG ONES, are going bankrupt, like Thai Airways, Hertz,..previously, before the virus, we also had Thomas Cook death. Most of people are surprised and shocked... but I wonder why they are. Big ones and travel related companies have cashflow thanks to mass tourism and globalization, but the net incomes, taken off all costs, are a very small %, because to have interesting prices, you have to reduce your margins. Clearly, when you reduce you margin, you do not save much to reinforce your assets.

Who will survive the Covid stop? Some smaller companies with no savings, will hardly get by. A wealthier, smaller company, will probably do, being flexible. A very big one I doubt, unless it has other "type" of business behind the scenes...because let's say it clearly, working in tourism moves mass money and people but the net in your pockets is not proportionally related.

For example and not many know (who doesnt' work in the business): talking about travel agents, that commission are very low (considering the money volume involved): around, average or less, 20% of the amount you sell, which hardly cover company costs. If you are a wholesaler you can make more % income of the price you sell, but to grant an interesting business volume and a good customer service, employees must be many and well prepared to face every single, bespoke request, a client has. Suppliers, often, in order to get the business, they go undercost...if you are big, you normally beat the competitors on prices..but if there are not enough clients...the big ones collapse.

Someone migh say: Arianna, but everyone wants to travel! I reply YES, great I know that BUT....BUT hides a question and a concept.

Question: Considering Cashflow Volume, why in travel mark up and fees are so low, when in other working environment instead are so high? Why should I pay a week holiday a low cost price (which involves underpaying suppliers)? and why instead, feeling happy when buying touchable items at very expensive prices which maybe involves a 100% or even more mark up for final client?

Concept: There is something wrong in this process: services and consultancy, also when talking about travel & holidays, are a serious job, which imply preparation, safety and professionalism. Working in tourism means having skills related to psicology, understanding and being available 24/07 because when most of people are on holiday, the travel professionals are on duty or on call to supervise on correct development of the services sold and to let Clients having their holiday & travel. So why such professionality is not properly, economically, recognized like a "physical" brand? Nor by the market, nor by the recognized authorities?

Now, considering what happened since January we have to add some more concepts. If you own a "tourism related company" in a country where tourism is not well managed and protected by the government, situation is not great. Laws are not properly tailored to real working needs and everyone survives in the market as possible.

When you live in a country that could live quite entirely on tourism, and there are not correct laws to protect the working environment and when the government is very chaotic and not focus on national priorities, not preventing situations, the situation is even worst. Maybe the country deserves your full attention as Client, the same attention the government is NOT giving to it!

All this, to make you understand that in order to travel, companies must be supported by correct laws, correct management and act accordingly. You as customer, should choose a correct "size" company...because when you travel with a very big one...you are a number and if they go bankrupt no one will be there to answer your calls when you have a voucher which is literally become just a piece of paper with no money value.

We must be efficient and sustainable when travelling, is essential for every destination and also for you, as Clients. So travel, explore and experience with local companies and professionals where you have a person to speak with! Remember that, for every professional, the most valuable asset is their Clients, so feel safe and comfortable and choose correctly who to contact to plan your travels in every destination! Said so, sometimes is correct to SAY NO to a Client when is needed and forced by situations, because your safety come first, always!

I will always be here, supporting travel and tourism to Italy and worldwide! xxx