Australian tourism industry to fuel up the SMEs
The Australian tourism has remained a booming industry with a record-breaking growth contributing $107 billion to the Australian economy in 2014-15. Both international and domestic tourists’ expenditure fed into that strong record, which is a direct 2.7 per cent industrial contribution to national Gross Domestic Product (GDP), accounts for 8.2 per cent of national exports and 4.6 per cent of total jobs. Tourism’s Gross Value Added (GVA) remained greater than the GVA earned from Agriculture, Forestry and Fisheries industry. In 2013-14, direct tourism GVA increased 3.4 per cent (or $1.3 billion) to $39.9 billion. The major players in this exponential growth remained: Education and training-up 7.8 per cent to $2.7 billion; Cafes, restaurants and takeaway food outlets- up 5.7 per cent to $4.4 billion; Clubs, pubs, taverns and bars-up 4.9 per cent to $2.5 billion; Air, water and other transport-up 3.5 per cent to $5.8 billion. Thriving with prospects Australian tourism industry is counted as one of the ‘traditional’ industries, thus, both the industry and governments have been working on merging supply constraints across investment, aviation and labour force to create the environment needed to reach the target. The future ahead abounds with prosperity for Australian economy.
A recent study by Tourism Research Australia (TRA) portrays the exponential growth of Australian tourism industry and its future potential. TRA has divided Australian tourism industry in three consumer sectors: i) inbound/international-visitors coming into Australia from all over the world; ii) domestic-visitors traveling inter-state or territory and iii) outbound-visitors from Australia going out in different global destinations for temporary stay for various purposes, such as, holiday making, business, education, visiting family and relatives (VFR) or medical treatment, etc.
The future ahead abounds with prosperity for Australian economy
International market and purposes of tourism
Asian markets remained the driving force in the international tourism industry in Australia; in 2014-15 this market accounted for 66 per cent of total visitor growth and 78 per cent of total expenditure growth. India and China remained the major Asian shoppers buying in Australian tourism industry for varied purposes.
The prominent purposes for inbound tourism accounted for leisure, business and education. Leisure visitor 2014-15 was the highest of 4.7 million, spending $18.4 billion. Business remained marginal interest in this period with 831,000 visitors, spending $3.5 billion. Education remained one of the strongest tourist attractions contributing $7.5 billion in expenditure.
Domestic market and travel purposes
While growth in inbound tourism is measured by their aviation and expenditure in Australia, domestic travels are measured in scale of ‘overnight expenditure’ and ‘expenditure for day trips’. The overnight expenditure of the domestic travellers accounted for the lion share of tourism for business purpose. Internationally sloth but vibrant domestic travels for business purposes thus boosted the growth figures for Australian tourism industry in 2014-15.
The outbound travelling slowed down during the 2014-15 with a total 9.2 million visitors. New Zealand remained the first and Indonesia, the second outbound leisure destination for the domestic travellers who go out of Australia. In 2014-15 fresh interest was around travelling to Indonesia and Japan (up 111,000 and 42,000 trips, respectively). Holiday making and visiting friends and relatives (VFR) visitors continued to drive growth in outbound trips (up 3.7 per cent and 4.4 per cent, respectively); however, holiday visitors, accounted for approximately 58 per cent of all outbound trips influencing greatly to outbound expenditure and nights.
Given under the tremendous growth potential, it is obvious that tourism industry will create many employment opportunities along with its significant contribution to the national economy. The increasing number of tourists will also fuel up the small and medium enterprises with increased growth opportunities. Considering the significant potential of small businesses in the tourism sector, the Australian government has taken several initiatives like Northern Australian Tourism Initiative which allows existing and potential businesses who are keen towards tourism industry, to access low cost advisory services at selected areas including –
- Funding and strategy support
- Entrepreneurs’ program
- Indigenous business sector strategy
- Business development and assistance program
It would be interesting to see how the small and medium business entrepreneurs can leverage off from the government support and be part of the exponential growth the tourism sector.