The Challenge Ahead, with Ufi Ibrahim

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2010-09-24_rsmtenon

The Challenge Ahead, with Ufi Ibrahim

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In an eye opening and informative forum this morning, Ufi Ibrahim, Chief Executive of the BHA made some surprising and thought provoking comments on the future of the hospitality industry in the UK and how political decisions and policies can/are affecting the trade.

With the aid of a well designed presentation, Ufi was straight-forward in her analysis of the industry as it stands at the moment.

Focusing on certain aspects and opportunities, she pointed out that there are forces at work and habits in place which are running against the industry’s ability to move forward and grow. However, it wasn’t all doom & gloom – not by a long shot!

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Use China as an example. As a viable source of inbound tourism there is massive potential for the UK to profit from this country, however there are a number of obstacles standing in the way of this happening.

  1. For a Chinese family to come to the UK a separate holiday visa is required for each individual
  2. All visa application forms are provided in English, only
  3. he cost of a visa for entry to the UK is considerably higher than one for a country on Continental Europe
  4. A Schengen Visa can be acquired for ease of entry into the majority of European countries, however the UK is not covered in this scheme.

Take into consideration that an estimated 40 million Chinese made international trips in 2009 compared to the 1.8 billion domestic trips made, then the upcoming ease of international travel restrictions for the Chinese public represents a massive opportunity for the UK tourist industry.

“It only takes a little change to make a big difference”

BHA wants to be proactive in its approach to improving both the number of international visitors to these shores. Looking at figures from UNWTO, there is a steep hill to climb but it’s not insurmountable.

  • In 2009 the UK placed 6th on the list of the World’s international arrivals list – putting that in perspective, the UK had 29.9 million visitors whereas France has 74.2 million
  • The UK comes in 7th for receipts in sales from inbound tourism – US$ 30.1 million compared to 2nd place Spain at US$ 53.2 million

A very interesting figure which Ufi also pointed to was the imbalance between British tourists and what they spend abroad compared to inbound tourists spending in the UK. In 2009 overseas visitors spent £16.6 billion while on holiday in the UK. British tourists spent £31.7 while travelling abroad. That’s an imbalance of £15.1 billion.

The importance and influence of politics and government on the hospitality trade cannot be overstated. As a sector, hospitality is directly influenced by government policy and decisions. Ufi pointed to the importance of being “in the room” when decisions are being made. To being part of the solution rather than standing on the by-lines and commenting on policy or decisions after the event.

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There are a number of Government policies which are going to impact hospitality:

  • Why does the UK not employ a “favourable VAT rate” for hotels and restaurants, as is allowed by EU law and employed by the vast majority of our European cousins?
  • Cut backs in public sector funding on promotion & marketing services are going to have an impact on the industry. How are these services to be replaced, if at all?
  • VisitLondon has had its budget decimated – how is this service to be replaced?
  • New immigration policy now excludes recruitment of international chefs from outside the EU. This despite the fact that research shows that for every specialist chef employed, 11 other jobs are created.
  • The Police reform & Social Responsibility Bill proposes that councils be allowed to ban the sale of alcohol between midnight and 6am.

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Another issue which was raised in during the discussion that followed Ufi’s excellent presentation was that, as an industry, hospitality is some times viewed as somewhat of a “Cinderella service”. Employing mostly transient workers and viewed as having unsociable hours and menial tasks, the industry is far from most people’s minds when they think of big business and importance to the economy as a whole. This flies in the face of the facts:

  • Hospitality is the 5th largest industry in the UK, contributing 2.6 million jobs to the economy.
  • Last year the sector contributed £90 billion to the UK economy and £34 billion in tax revenue to the exchequer
  • As part of an ongoing strategy and policy, BHA is striving to create 236,000 jobs before 2015.

Ufi was adamant that if the industry works together on improving its image, lobbying government, applying the necessary pressure and working as one then Britain can move back up the leadership board in terms of a preferred destination.

As an industry there are many opportunities coming to these shores which can and will high light Britain in a favourable light.
The Royal Wedding. The Queen’s Jubilee. The Rugby Union Championships and – of course – the Olympics.
According to VisitBritain 4.7 billion viewers (or 70% of the World’s population) saw at least some of the coverage of the Beijing Olympics.

“A joint vision, a single voice, a common message and unified action leads to competitive success”

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If you have any further queries please contact Arlene.tobin@epmagazine.co.uk

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