Tourism businesses report slow September quarter

THE peak body for Victoria’s tourism and event industry says businesses have reported a slower September quarter but are expecting a lift over summer.

The Victorian Tourism Industry Council (VTIC) is also stressing the need to attract more visitors from elsewhere in the state and Australia as well as overseas.

More than a third of businesses in the tourism sector reported a decline in profits during the September quarter, but international visitation numbers remain strong and one in five businesses reported a rise in export activity.

Business conditions are expected to improve entering the final quarter of 2017, which features a strong calendar of events.

Almost half of tourism businesses expect sales to increase and 43 per cent expect profits to rebound.

VTIC chief executive officer Brad Ostermeyer said the Survey of Business Trends and Prospects results showed that despite a promising outlook, important lessons for the future must be learnt.

“The decline in profits over the September quarter was a disappointing but not surprising outcome. The winter off-peak is usually a quieter trading period for tourism business, and this is reflected in these results.

“International visitation numbers remained strong and 20 per cent of businesses reported a rise in export activity.

VTIC says the industry is naturally optimistic with Victoria’s events calendar heating up and the extended school holiday period approaching before Christmas.

“The cyclical and unpredictable nature of profitability and business conditions presents important lessons for the tourism industry,” Mr Ostermeyer said.

“It is vital that we strategically market Victoria to interstate and intrastate visitors as well as our international visitors.

“Our international visitation numbers are strong but the cooler winter months are also a terrific opportunity for Australians to take advantage of lower airfares and accommodation prices and discover what Victoria has to offer.

“The industry’s coming peak trading period is a welcome relief but will also create rising employment costs. Almost a quarter of businesses in tourism plan to reduce overtime offered and only 22 per cent are planning to increase employment levels.

“If business can benefit from consistent, year-round visitation numbers across international, interstate and intrastate markets, this will help off-set some of the impact of rising labour costs over the holiday period.”