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The EU Referendum | How could a Brexit affect the holiday industry?

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The EU Referendum | How could a Brexit affect the holiday industry?

The debate is certainly hotting up as the UK gets closer to the vote on June 23rd, with recent news of the government EU referendum registration site crashing due to high demand. Amidst the hyperbole, it is often difficult to find facts backing up arguments for “Leave” (Brexit) or “Remain”;  we’ve sought to find some statistics that might help holiday park operators understand how the vote might  affect their business.

Currently, the single market allows all 28 member countries to operate as one territory, without internal borders or regulations hindering the free movement of goods, people and services.

In an article by The Guardian, three representatives from the tourism and small business world offered their viewpoints on how the industry might be affected.  Possible savings might arise from any VAT changes but are these negated by the threat of loss of revenue and higher labour costs?

Regardless of how the vote might turn out, the uncertainty surrounding the EU referendum may be having an impact on consumer behaviour, trade, currency fluctuations and investment decisions.  This would be set to continue in any “negotiation phase” following a Brexit.

Let’s look at the income levels, labour models, travel regulations and currency value impacts that would be the main focus for holiday park operators.

There are strong travel and tourism flows between the UK and EU.

In a recent piece of research by Deloitte and ABTA entitled “What Brexit might mean for UK travel”, some interesting statistics surrounding the hospitality industry are highlighted:

  • 76% of UK holidays abroad are in EU countries (29.3 million in 2014)
  • 63% of inbound visitors are from EU countries (8.8 million in 2014)
  • The top three countries accounting for inbound visits are France (1.9 million), Germany (1.4 million) and Italy (855,000)
  • 44% of UK inbound travel and tourism spending is by EU nationals (£9.55 billion in 2014)
  • 56% of UK outbound travel and tourism spending goes to EU countries (£19.76 billion in 2014)

The report goes on to conclude that this strong symbiotic relationship has “been facilitated by the free movement of goods and services, investment and people across the EU.”

The Deloitte/ABTA report also covers the implication of travel regulations (the need for the UK government to create parallel legislation that the EU has created that protects consumer’s rights), and the possibility of price sensitivity of the cost of future holidays due to tax and currency implications.

The hospitality workforce and the EU

A survey by People 1st, highlights “hard-to-fill” vacancies, where transient and low-skilled workers are required due to pay and hours requirements – “self-catering accommodation” accounts for 49% of these vacancies – the highest proportion.  Referring to the EU migrant workforce which plugs these gaps…“If any curbs are introduced this could have a devastating effect on the hospitality and tourism sector. The latest figures suggest that 8% of all migrants in the UK work in hospitality roles, which makes it the third largest industry employing migrant workers.” People 1st also highlights that in the “camp site and accommodation sector” 44% of the workforce are part-time.  This importance has also been echoed by the CBI in a recent article.

Holiday park operators and the EU – in or out

Whether your holiday park is single or multiple site, operates within the UK or across Europe; the outcome of the EU referendum will affect your business, whatever decision is made.

Prodware have many years’ experience in supporting holiday park operators with their business management software which enables them to have a true picture of revenues, labour and other overhead costs and have the ability to report on all areas of the business.

If your operations and finance team need to make any decisions arising from the outcome of the EU referendum, an integrated and responsive software system such as ParkVision will help in “what-if” scenario planning and data interrogation so you continue to optimise customer satisfaction and profitability. Please contact us to find out more.

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