Tourism

As you can imagine, I read with some interest the controversy earlier in the week when the CEO of the Tauranga Chamber of Commerce was criticised by the PM for reportedly suggesting that Tauranga shops should ramp up prices during cruise ship visits.  I am not sure that this is exactly what my colleague from Tauranga actually said.  If he did I am with the PM on this issue.  We really should be doing as much as possible to give tourists a great experience of New Zealand.  In particular we want them to tell their friends back home about how New Zealand was great value for money, not one of those countries that seeks to rip tourists off at every opportunity.

This issue is very current here in Switzerland with hotels, restaurants and shops preparing to ramp up prices and impose otherwise unacceptable terms on those about to descend on the area for the meeting of the World Economic Forum.  The event has long outgrown the town of Davos itself.  Our Trade Minister Tim Groser is having to be accommodated 15 minutes away in Closters (which isn’t that bad) but Australia’s Trade Minister is having to stay an hour away from Davos (his PM and Treasurer are going also so get accommodation in or close to Davos).  There are reports that Richard Branson can’t get accommodation any closer than Zurich.

How are hotels responding?  Well prices are way up reflecting demand that is well ahead of supply.  That is to be expected.  But what annoys me is that many hotels are demanding that people book for a full week at these exorbitant prices, even though a booking of two or three days is all that is required.  Moreover the hotels expect the right to be able to sell these already paid for rooms to new clients once guests have checked out, or before they have checked in.  I was kind of hopeful that the international financial crisis would encourage a rebellion on the part of those attending the WEF meeting but there are no signs of this happening.

Getting back to New Zealand there is an immediate action that the New Zealand Government could take to make New Zealand better value for foreign visitors and encourage them to shop in New Zealand.  We could intriduce a GST refund scheme similar to that operating in jurisdictions such as Singapore or the UK.  I must dust off a letter I wrote to the previous Government on this topic.

A350 On Time

The media here is reporting that work began yesterday in Toulouse on the building in which the new Airbus 350 will be built.  Production of this new aircraft type is on time with first deliveries expected in 2013.  29 airlines have so far placed orders for 478 of these new generation aircraft – similar to the Boeing 787.  This is of particular interest to the Wellington region as the performance of this aircraft will allow more destinations to be reachable from Wellington than can be achieved by current aircraft types with economic payloads.

How Osama Bin Ladin Damaged The Wine Trade

The most profitable bottle of wine sold by a wine company is a bottle that it sells direct to the consumer.  Mail order and cellar door sales have always been a useful extra for our business (we export 80% of our production) but for some small producers it is the bread and butter of their business.  No one else gets a margin on the sale of the bottle.  I have seen a bottle of our Reserve Pinot Noir on wine lists in Sydney for A$120.  We have only received arond NZ$20 for that bottle.  The rest is margin taken by others.  Likewise we only receive around NZ$20 for the same bottle sold here in New Zealand at a retail outlet.  Our New Zealand agent and the retailer take the other $20.

Our cellar door is on State Highway 6.  There is lots of passing traffic.  As we are the first wine sales and tasting facility you strike when driving from the West Coast to Queenstown we get plenty of foreign tourists calling in.  In years gone by we used to sell good quantities of wine to these tourists – three to six bottle sales were common.  Sometimes they would even buy a case.  This wine was hand carried back to their country of origin. (I too used to buy multiple bottles of wine to hand carry back to New Zealand from various wine districts around the world.  I own a “pilot’s briefcase” which can hold 12 bottles of still or 9 bottles of sparkling.  Many serious wine tourists had similar devices available.)

Since 9/11 and subsequent terrorist incidents it is not possible to hand carry liquids in containers of more than 100ml.  Wine can be carried in cabin but only if purchased at airport duty free shops and in sealed bags from these shops.  So if a visitor to a winery wants to buy bottles of wine to take home they have to put them in checked in baggage.  This is risky even if one packs the bottles well in moulded wine packs.  It also affects the weight of one’schecked in baggage.  People don’t like packing wine in their suitcase, even to the States were weight isn’t an issue.  In consequence the amount of wine sold direct to foreign visitors has plummeted.  We still make plenty of single bottle sales (for consumption while in New Zealand) , but the multiple bottle sales are pretty much a thing of the past.  Wine tourism all over the world has been affected negatively by the hand carry on rules.

I personally think the rules are a bit of an over reaction.  And their strict intepretation is even worse.  I have seen alcohol purchased duty free in one jurisdiction confiscated at transit points in other jurisdictions on the grounds that it wasn’t purchased at that transit point (Frankfurt Airport does this regularly).  And I once had a near empty tube of tooth paste confiscated at Singapore Airport on the grounds that the tube said the contents was 120 ml.  These practices do not need to happen.  One day I hope we can revisit the 100ml regulation. 

Update – While writing this post we have had visitors from the UK and US (Seattle) call in for a tasting who have said that they can’t buy any wine because of this regulation…..