Small hotels struggle as 5 star properties slash prices

Friday, November 20, 2020

While a majority of upscale hotels have resumed business, at least 2,500 smaller hotels — largely two- and three-starred — that depend mostly on budget foreign and domestic tourists, have not yet begun operations.

The need to compete with the lowered tariffs and attractive stay packages offered by four- and five-starred properties has only added to their woes.

Domestic tourists also prefer high-end hotels on the presumption that these will scrupulously follow the standard operating procedures (SOPs) implemented amid the Covid-19 pandemic.

“Of the 4,000 registered hotels in the state, just about 1,100 have commenced their operations, but most smaller hotels haven’t for want of business,” said president of the Travel and Tourism Association of Goa (TTAG), Nilesh Shah.

He said that while the number of three-starred hotels that have resumed is not likely to be more than 60, the only silver lining is the resumption of casinos that could in turn spur the reopening of small hotels in and around the state capital over the next few days.

Domestic tourists stay in the state for an average of three to four nights as against a period of 7-20 days logged by charter tourists and other foreign arrivals that comprise mostly British and Russian nationals.

Chief operating officer (COO) at Sita Travels, Ernest Dias, said the absence of charter tourism was a major stumbling block for two- and three-starred hotels. “While swankier properties have been able to stay afloat by slashing room tariffs, how long they will be able to sustain themselves in this fashion is the question as the domestic tourist rush is seen only during weekends and extended weekends,” he said.

Since 2010, more than half of the charter flights that Goa received have been from Russian destinations. The 2013-14 tourist season saw the sunshine state receiving its highest number of 1,128 charters, with as many as 895 of these coming from Russia.

An industry insider said many tried to cash in when charter arrivals into the state witnessed a growth over the past two decades, specially, after charters from Russian destinations grew. While the ’80s and ’90s saw predominantly British and European charter tourists, they were later outnumbered by Russian travellers.

« Back to Page