Nepal | November 14, 2019

‘There are concerns of too many hotels chasing the same slice of pie’

Rendezvous

The Himalayan Times

The country is observing Visit Nepal Year 2020 aiming to brand Nepal’s tourism globally and raise the inflow of foreign tourists. Though the tourism campaign is expected to play a significant role in taking the country’s tourism sector to new heights, tourism fraternity, especially the hospitality sector today is worried about the sluggish preparations for the campaign and tepid growth in the flow of tourists despite increasing investment in the hospitality industry.

Against this backdrop, Sujan Dhungana and Arpana Ale Magar of The Himalayan Times caught up with Shreejana Rana, president of Hotel Association Nepal, to know the underlying issues in the hospitality and tourism industry and the Visit Nepal Year 2020 campaign. Rana is also the executive director of Hotel Annapurna. Excerpts:

Shreejana Rana, Executive Director of Hotel de l’ Annapurna in Kathmandu on Monday. Photo: Balkrishna Thapa Chhetri/THT

What is your overview of the current status of the hotel industry in Nepal?

Currently, the hotel industry in Nepal is growing at a decent pace. From budget to luxury hotels, the industry is expanding throughout the country. Numerous international brands are entering the market, such as Marriott, Aloft and Vivanta. Existing hotels are also upgrading themselves, especially in terms of their accommodation and food and beverages services. Many tend to view the hotel industry as a glamorous one, but there are many challenges that we as hoteliers face.

A major problem of our industry here is that hotels are unable to obtain the price for the service that they offer, while abroad, the services may be limited but prices remain reasonably good. Similarly, another challenge stems from the limited pool of high-end clientele that we receive. It is imperative to understand that the growth of the hospitality industry is closely intertwined with the promotion of our tourism industry. We are one of the best countries in the world in terms of product, and we must utilise this for the benefit of both the hospitality and tourism industry by investing adequately in marketing, infrastructure and connectivity.

The government is observing ‘Visit Nepal Year 2020’ to promote country’s tourism. How is HAN preparing for the tourism campaign?

In preparation for the Visit Nepal Year 2020 (VNY 2020), HAN has been giving priority to standardising training, whether for homestays or five-star hotels. These training programmes — that cover housekeeping and front desk to kitchen and
basic sanitation and hygiene — will ensure the safety and quality of guest
services. After all, it is not just about getting tourists in our country, it is also about making sure they go back with a smile and want to return again. Likewise, HAN is also putting a strong emphasis on promoting Nepali cuisine. We intend to promote the local cuisine and products of each of the seven provinces to boost both international and domestic tourism for VNY 2020 and beyond. We want our visitors to enjoy exploring and visiting different parts of our country.

As you are also a board member of the VNY 2020 campaign committee, how satisfied are you with the preparations so far?

Preparations for such a mega tourism campaign should have begun at least two to three years ago. Hence, we were late in starting necessary preparations for the campaign. Even after we started the process, timely decision-making and implementation mechanism were weak. However, all stakeholders are aware that VNY 2020 is a national campaign and have been supporting the event.

Along with new international hotel chains investing in Nepal and domestic hoteliers expanding their businesses, around 4,000 star rooms are expected to be added within 2020.

Will the current flow of tourists be able to meet occupancy rates of these additional rooms?

The growth of the hotel industry is a positive change. With an increase in the number of international chains arriving in the country, all of us have been motivated. However, keeping in mind the current flow of tourists, meeting the occupancy rates of the additional rooms will be a difficult task. There is genuine concern that there are too many hotels chasing the same slice of the pie (number of tourists), while the pie has not increased in size. All of us are hopeful that Visit Nepal 2020 will address this situation and benefit us.

Besides this, relevant government and tourism bodies must also do their part in improving the hospitality and tourism industry. For instance, currently, we do not have direct air connectivity to any country in Europe or the United States, making it very expensive for tourists there to visit Nepal. Thus, the provision of direct air flights will reduce the airfare and increase the number of European and American tourists visiting Nepal. Similarly, there is a need for us to diversify our market and target South East Asian countries such as Laos, Cambodia, Sri Lanka and Vietnam, especially for religious and leisure tourism. Last but not the least, the government must conduct a bilateral meeting to remove the European Union ban on our domestic airlines.

What is the current occupancy rate in the hotel sector?

For the 2018-2019 year, there was tentatively 55 per cent occupancy held by
the hotel sector in Nepal. While average occupancy rates generally tend to fluctuate depending on the season, we are hopeful that with the VNY campaign, the occupancy rate will rise in 2020. In preparation for the upcoming year, hotels have been working on updating their products in terms of services.

What do you feel should the government do to promote the tourism sector?

Besides what I have touched on previously, I would like to point out the importance of all of us in the tourism industry, whether government or private sector, to work hand in hand for progress in the industry. The government must include the private sector in decision- and policy-making processes. There is significant investment in the hotel sector and the government must take measures to protect investors and their investment. While plans and policies are in place, implementation by the government remains weak. The industry must be given precedence and be provided with the same facilities as other priority industries.

Likewise, the government must also invest in research before issuing licences to hotels, as this affects the reputation of both our industry and country. Proper implementation and accountability mechanisms must be in place for growth. The government must also engage in thorough research on ways to market Nepal internationally. Depending on the country being targeted, different marketing tools and strategies may have to be used; a qualified professional must be hired. It is not only enough to secure and spend the allocated budget for purposes of promotion, marketing has to be done in an effective manner to connect with the intended target audience. Subsequently, proper evaluation measures must be put in place to analyse the effectiveness of the marketing programmes.

The tourism fraternity has often complained about weak tourism infrastructure being a major setback to tourism growth in Nepal. What is your take on this?

Infrastructure still remains one of our biggest drawbacks. Infrastructure is vital for development, not only for the hospitality and tourism industry, but for all industries in Nepal. But road connectivity is poor and air connectivity expensive. While the country has taken a positive step towards renovating as well as constructing new infrastructure, the pace is far too slow.

To accelerate the momentum, incentives and penalties must be established and administered. And, along with our infrastructure, it is also essential that our basic services are at par with international standards. Proper sanitation, hygiene and garbage management are essential. For example, one may have the best toilet facilities but if it is poorly maintained, it is pointless. I hope the proximity of Visit Nepal Year 2020 will provide the necessary push to relevant departments to make infrastructure a priority and work more efficiently and effectively.


A version of this article appears in print on August 13, 2019 of The Himalayan Times.


Follow The Himalayan Times on Twitter and Facebook

Recommended Stories: