Will new Fraser Island legislation make for a more viable industry?
Director of Frasers on Rainbow hostel and 4WD Greg Zammit discusses the effects the new Fraser Island 4WD legislation will have on the industry.
At the end of February the Bligh Government introduced compulsory “Tag-along” tours for backpackers visiting Fraser Island; these changes to take effect June 30th 2010. This amendment however took place only a month after already advising hostels in the Rainbow Beach/Hervey Bay region that they would be able to continue their current operations with some slight amendments including reducing numbers (to 8 passengers) and no luggage on the roof.
Although the government website boasts that the move follows “lengthy consultation” with industry and has “broad industry support”, once again a government department has shown a complete lack of understanding of the lead times required by tourism businesses to implement major changes. Although it is true that hostel operators want greater safety, and do support the broader regulations, many leading operators such as Frasers on Rainbow Beach market their product interstate and overseas and set pricing a minimum of 12 months in advance. We simply cannot change our rates with four months notice.
I have calculated that in my business alone in Rainbow Beach these changes will cost me in the vicinity of $180,000 in lost revenue in the 2010 year, and estimate the industry as a whole may lose millions.
So what is the mid to long term benefit of these changes? In addition to increased safety I am hoping that the short term loss in revenue will lead to a more viable industry in the long term. From my experience however, the east coast backpacker market has demonstrated a poor record of setting realistic prices for their services. There is no doubt that these government regulations will eliminate those operators that are not willing or able to invest in their businesses and set their prices accordingly.
My HOPE is that hostels will now price their products at a viable level that allows them to re-invest into a quality operation. The current package pricing in the region foolishly encourages visitors to stay only 2 nights (1 pre night & 1 post) in their hostels and has nett rates set so low that nobody can legitimately claim good profit margins.
It is now time that the industry set some realistic commissions, whilst still allowing for wholesale vs retail sales. We need to encourage people to stay on the Fraser Coast and not just the island.
Frasers on Rainbow Beach will shortly release new packages incorporating other highlights of the region, including kayaking with dolphins, hand-feeding wild dolphins, and skydiving, in addition to the traditional Fraser/Whitsunday packages.
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