RAINBOW Tourism Group (RTG) has distanced itself from the hotel price madness experienced in Bulawayo a few weeks ago adding that price increase will only be their last resort after exhausting all available options.
Hotels in Bulawayo shocked exhibitors to the 2019 edition of Zimbabwe International Trade Fair (ZITF) by increasing their prices to unimaginable levels with some charging as much as $600 to $1800 per night and only accepting those booking for a whole week.
Addressing analysts at the company’s results briefing for the year ended 31 December 2018, RTG group chief executive officer Tendai Madziwanyika said they will not resort to price increase in order to solve their company’s profitability.
“We will not resort to price increase as a solution to our margins and profitability we will only increase prices as the last resort.
“In the meanwhile as I said to you the value of foreign currency is improving and that is why we have actually sustained a much lower increase in our rates than what has been going on in the market.
“I think we all know that bread which is a basic commodity has gone from about $0.80cents just over a year ago to now about $3 but we have not increased our rates to the same percent, fuel has gone up from a $1.31cents to $3.40 but I tell you we have not increased our rates to the same level though our profitability increased so the key is to push down costs to make ourselves more competitive before we resort to increasing prices,” he said.
Commenting on the ZITF saga, the RTG boss said their process actually went down in US Dollar terms compared to the same period last year.
“May I take this opportunity to just address the whole thing about ZITF prices if you were to look at our prices this year and the same period last year in USD terms we actually went downwards,” he said.
If it remains unresolved, hotel price increases can go a long way in affecting domestic tourism efforts that the Ministry of Environment, Tourism and Hospitality Industry is trying to push together with the Zimbabwe Tourism Authority (ZTA).
Speaking in Bulawayo last week Marketers Association of Zimbabwe secretary-general Gillian Rusike said there was need to promote domestic tourism first before preaching the message to the outside world. Zimbabwe’s tourism sector mainly relies on foreign tourists as locals are not able to consume their products due to lack of meaningful disposable income.