Tourism feels the pinch

The drop in room occupancy rates can be partly attributed to the current economic situation in the country.

31 August 2018 | Tourism

The latest statistics on the performance of the tourism industry indicate that there has been a drop in room occupancy numbers at tourism establishments in comparison to last year.

This can be partly attributed to the current economic situation in the country, which has not only resulted in government spending cuts but Namibian citizens also have far less to spend on leisure activities.

Statistics provided by the Hospitality Association of Namibia (HAN) show that in the second quarter of this year the room occupancy in the country stood at 49.2%. This is a decrease of about 7% from the previous year, when it was 56.3%.

There was also a decrease in the total number of beds sold countrywide, from 48.20% last year to 42.1% this year.

In simple terms, occupancy rate refers to the number of occupied rental units at a given time, compared to the total number of available rental units at that time.

So, for example, if a hotel has 100 rooms available to be sold and 100 of those rooms are occupied, the occupancy rate would be 100%.

In the hospitality industry, a bed night sold is a measure of occupancy of one person assigned to one bed for one night.

The southern and northern regions performed slightly better, recording 59.3% and 52.8% room occupancy rates, while the central and coastal areas had 44.45% and 44.37% room occupancy rates.

The domestic market, which constituted just under a third off all occupancies in 2017, experienced a dip of about 1.3% in 2018.

A total of 42 815 (25.9%) Namibian visitors were recorded during the second quarter of this year.

Namibia experienced an increase of about 3% in German-speaking tourists, with more than 27% (45 776) of foreign visitors coming from Europe.

Furthermore, the statistics show that South African visitors, who also make up a large part of Namibia's tourist market, decreased slightly from 26 005 (11.7%) to 17 486 (10.5%).

Statistics show that 82.7% of guests during the second quarter of this year were leisure tourists, while 12.85% of guests were here for business and 4.3% were attending conferences.

During the same period last year, leisure tourists accounted for 76.85%, while 17.6% were business people and 5.56% were attending conferences.

“It should be noted that especially the properties outside the capital are feeling the pinch, because the government has cut its travel spending and decided to host most of the necessary meetings in the capital, so conference facilities at the coast and the north have felt the pinch, some reporting a 70% decline in income from government events this year,” the CEO of HAN, Gitta Paetzold, told Namibian Sun.

She added that even in Windhoek sharp declines were felt, with far fewer conferences and events hosted and the duration of such events also significantly shortened. Some establishments have recorded declines of 20% to 50%.

“Luckily, tourism has always applied the two-pronged approach, with leisure tourism in Namibia taking the lead over business tourism, and due to the geographical spread and the diversity of different establishments and properties operating in Namibia, it is mainly the business hotel and conference sector that is feeling the pinch,” she said.

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