Now’s the Time to Buy That Tourism Business
Those looking to escape the grind and buy their own business are often drawn to the tourism industry, and it’s easy to see why. In most cases, no special skills or qualifications are required, and you can utilise existing skills, such as customer relations, marketing, retail and administration.
Australia is the world’s seventh largest tourism market and, as such, there are plenty of great opportunities to do business in this sector. Right now, it’s an extremely attractive option as tourism is growing three times faster than the national economy.
In fact, it’s one of Australia’s five super-growth industries and huge amounts of money are being invested in tourism infrastructure.
Consistent Growth
Within the industry itself, there are plenty of options when it comes to businesses, including accommodation, cafes and restaurants, bars and hotels, tours, attractions and equipment hire.
One reason why a tourism business is a smart investment right now is the consistent growth in visitor numbers, both domestic and international. In addition, business travel is also increasing.
International visitor numbers for the year ending December 2018 were 9.2 million, an increase of 4.9% on the previous year. Visitor nights increased by 4% to 274 million. But here’s the best bit: those visitors spent a record $43.9 billion over the year, which was 7% more than the previous year.
Record Spend
The great thing about the tourism industry in Australia is that the growth in international visitors is supported by very strong domestic visitor growth.
Australian travellers enjoyed 100.3 million overnight stays during the year ending December 2018, an increase of 7% on the previous year. And during that time, they racked up a record spend of $67.5 billion, an increase of 8%.
Interestingly, 44 cents of every tourism dollar spent in Australia is in regional areas.
Are these figures sustainable? According to Tourism Research Australia (TRA), yes, they are. TRA forecasts suggest international visitors will grow by 64% by 2026–27. Domestic travel is likely to grow by 24% (overnight visitors) and 29% (day visitors) over the same period.
Major Markets
The five major markets contributing to the growth in international visitors are the US, the UK, China, Japan and New Zealand. China accounts for one-quarter of the total spend.
This level of growth is certainly encouraging if you’re considering buying that hotel, motel, restaurant or café. What’s even more encouraging is that the industry is being well supported by government and others through Tourism 2020: A Strategy for Growth.
This long-term strategy compiled by both government and industry experts will further strengthen the industry, build-in competitiveness and grow its economic contribution. Tourism 2020’s goal is to reach more than $115 billion in overnight spend by 2020 (up from $70 billion in 2009).
Buy with Confidence
If you are looking at accommodation businesses, you can buy with confidence. The outlook for this sector is very strong, due to increased demand for rooms and the relatively low levels of new supply.
According to Deloitte Access Economics, national occupancy rates should climb to 70.8% in 2019, with average room rate growth and RevPAR growth to reach 2.5% and 3.1% a year.
You’ll find an excellent selection of tourism and accommodation businesses for sale in this issue of Coast to Coast Australia, so take a look. Your exciting and rewarding new future is within these pages!