Why not give discounted room rates to individual customers rather than to Tour Operators? To make them fat?

 

Guests want to book their holidays with the resort; resort wants guests to book directly with them.

But resorts give discounted wholesale rate to tour operators but not to individual guests despite wanting them as direct booked guests. What cooks?

Here is the everyday situation in resorts that shouldn’t have been in the first place. After seeing a gorgeous picture (something like the picture below) of the perfect blue sky and an even perfect white beach, the would be guest hurriedly tries to book a romantic getaway to Maldives with a life partner. Searching through google brings the guest tons of ads almost all leading them to a booking site. The booking site happily lets the would be guest click through a few times on the webpage and sends confirmation email with travel itinerary and a welcome email for holiday package worth sometimes a little over 5k$ for a week’s stay in one of the most beautiful islands in the world. The customer is indeed set back that many dollars from his net worth for this effortless business created by a third-party booking site. The hotel gets a slice of the pie as well as the booking site and sometimes a few other partners all enjoy a slice of the pie. This is standard proven business model right?

Actually this maybe the wrong model but the one working model customer has no option but to comply with.  Tour operation is effortless big business which should belong to history. At least that’s what it should be considering Maldives is one of the safest destinations in the world, together with good internet coverage and this being 2017; in theory a customer shall be able to deal directly with hotel to book his stay without intermediaries. But why are guests still paying the (evil) middle man? The answer is actually funny and kind of depressing.  Resorts give discounted wholesale rates to tour operators with the assurance that tour operators will do the marketing work and send guests to the resort in off-season. Its outsourcing their most important department (marketing) and doing business the effortless way.

Marketing in most resorts in Maldives is less about marketing than dealing with outsourced marketing firms and tour operators. Tour operation is so widespread that there are tour agencies who do not market at all, but sell packages to other tour operators from discounted packages they get from resorts. What all this does is add bloat to the customer’s holiday package from which only a small portion is received at the resort. This is one reason vacation packages in Maldives are pricy compared to some similar destinations. On the other side it’s also important to keep prices artificially high to appeal to the wealthy customers for “exclusivity effect”.  This is also mostly true of big brand resorts while average resorts are happy with their island being self- marketed by natural beauty and word of mouth type marketing.

Strike action in Hulhule Island Hotel over discrimination

Vaguthu reports about the ongoing strike action in Hulhule Island hotel.

The local staff of the hotel are on strike about dissatisfaction with management for not being paid the salary in US dollars and asking for a raise.

HIH is operated by a joint venture company with 35% share of sats (Singapore) and 65% share of MACL (Maldives).

According to Vaguthu report, 80 of the 90 local staff are on strike. The local workers demands are actually very simple considering the fact the hotel gets all its revenue in US dollars. The local staff are actually asking for a portion of their salary to be paid in dollars; not even the whole amount. The expat staff are being paid in dollars by HIH and the resort recently increased the pay of expat staff following the recently implemented law on remittance fee for foreign workers in the country. The local workers are citing this as discriminatory as many new taxes were implemented for the local population and they did not get a raise to cover these by the hotel.

Another concern raised by the workers is that almost all the position of management of HIH are filled by expat workers and the hotel offers very little opportunities for local talent.