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Comment by J.Skidmore: Ski operators falling into the summer trap
At a time when the industry needs a return to sensible pricing, the ski market seems to be following the summer trend for giving away holidays. Snowfalls this year in Europe have been sensational – whatever happened to global warming? – with most operators reporting increased bookings. But despite the buoyancy there are deals galore. If you’re prepared to book outside the peak half-term school holiday period in mid-February you can take your pick of the 30% off deals. And if you can go within a week of departure, you might even pick up a two-for-one deal. How can this be? As in summer, there are simply too many holidays on the market that need to be shifted at a price, any price. Go back 10 years and ski holidays were overpriced and of poor quality, with run-down chalets and pretty inedible food in many resorts. Ski operators were making money hand over fist. Now standards have improved hugely – and rightly so – but at the same time, the real cost of the holidays has fallen through the floor. Competition is fierce, particularly with so many low cost flights flying into Europe, and anyone thinking of making a quick buck by starting their own ski operation is in for a rude awakening. Of course, this is fantastic news for the consumer, but how long can the ski operators survive playing the discount game? One or two companies have already bitten the dust and others may follow. To see any stabilising of prices, we’ll need to see more fall out in the market. Ski operators may find to their cost that once you’ve dropped the price to clients, it’s incredibly difficult to get them to pay a fair amount for a package. As for the summer, it’s no surprise to see demand has dropped off after the initial excitement of early January. Tour operators to Spain and Greece, the backbone of Mediterranean packages, are reporting sluggish bookings. Now operators are hoping even higher discounts and the cold spell will get people thinking about going away. That may be wishful thinking. As Noel Josephides of Sunvil Holidays said, people have lost all understanding of how much it costs tour operators to put together a decent package. Who can blame them when there are always companies willing to offer £99 deals? Margins were thin last year – don’t expect them to be any better in 2004.
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