Tourism is booming, but companies fight with overwhelming costs!

Tourism is booming, but companies fight with overwhelming costs!

The Austrian tourism sector faces a paradoxical phenomenon: Despite significant sales growth, many companies are faced with a falling profitability. This emerges from current surveys that show a large number of challenges for the industry. According to a report by vienna.at , companies feel the pressure through increased personnel, energy and goods costs as well as a high tax burden that has a negative impact on the overall assessment of the economic situation. The tourism industry is currently receiving an overall grade of 3.06, which represents a deterioration compared to the previous year.

Although the demand for tourist services has achieved the pre-pandemic level, the high costs burden the financial framework of the companies. For example, 40% of the over 200 companies surveyed fear a deterioration in their financial situation in the coming summer. About 90% of tourism companies report negative effects through the increased costs, while almost a third of the companies with negative developments in the industry are expecting the concerns. Companies expect a increase in sales for the summer of 2024, but at the same time the price enforcement capability is severely restricted.

financial uncertainties

A significant part of the companies is faced with financial uncertainties. Almost half of the companies surveyed have difficulty receiving credit financing, which has a negative impact on planned investments. 42% of the companies have already reduced their planned projects, while 35% expect further restrictions over the next five years. The economic uncertainty, which is also underpinned by a wko-study , to make many actors in tourism.

It is particularly alarming that 66% of tourismists state that it has become more difficult to receive loans. In addition, 36% of borrowers had to provide higher security borrowers, which further increases financing pressure. The effects of the named financial conditions on the price sensitivity of the guests are also significant. 83% of companies report changed price sensitivity, which means that customers pay more attention to prices and are willing to consume less at higher prices.

strategic measures to increase efficiency

In order to meet the challenges, efficiency increases and strategic pricing are necessary. The companies therefore try to reduce their costs and increase the income through targeted measures. An example of this is the use of artificial intelligence (AI), which already use 40% of companies to save time and improve the guest service. These technologies are considered an opportunity not only to increase employer attractiveness, but also to optimize customer experience.