Vietnam’s tourism revives, starts again from scratch

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The market is completely new after Covid-19. All players, small and large, will be at the starting point. Those who have a good start will obtain more market share.

Vietnam's tourism revives, starts again from scratch

Russian travelers in Khanh Hoa Province.

“Move up, even just one centimeter. Slow means losing,” said Nguyen Quoc Ky, Chair of Vietravel Holdings at a recent workshop on risk management held by HCM City Tourism Department and Hoa Sen University.

When Covid-19 broke out, Vietravel decided that the firm would experience four stages of administration – active hibernation, defrosting, acceleration and full recovery.

Active hibernation means cutting operation costs, while ensuring basic divisions to keep the firm alive. During the pandemic peak days, the firm focused on marketing and on-the-spot tourism, so as to reactivate itself immediately when necessary and make clients not ‘forget’ the firm.

Vietravel’s 64 offices nationwide had to close the door during the pandemic, but the firm did not stop its operation on cyberspace. When HCM City was in lockdown, some divisions still kept working, including marketing, product building and finance.

The firm has just entered the second phase. Ky said it’s necessary to ‘defrost’ as soon as possible once the pandemic has been controlled. The things that need to be done immediately are building staff, products and developing the market.

“All travel firms, large and small, are at the same starting point. Those who have good start will quickly regain the market,” he said.

“There are no more loyal clients, because everyone is just ‘loyal’ to their benefits. If we cannot find clients’ demands, we will be left behind, and if we don’t have good products, we will also be left behind,” he continued.

“If you sit immovable, you will fail,” he said.

Tran Nguyen from Sun World has the same view. She said at a national tourism forum in late December 2021 this is the opportunity to reposition Vietnam’s tourism. Travel firms need to more effectively exploit the domestic market with 85 million customers and lure foreign travelers. It’s necessary to attract them with low tour fees, but high-quality service and good experiences.

Tourism can live only if other business fields recover

The tardiness not only affects the tourism industry, but also the supply of input materials for domestic production, and goods circulation. If Vietnam is slow in resuming international flights and reopening tourism, it will lose in a market with many strong rivals.

The defrosting period will be followed by acceleration and full recovery. According to Ky, in the best scenario, the defrosting will be completed by the end of Q1 2022 before travel firms can gear up. And only by 2022 or 2023 summer will the sector recover fully.

Ky said aviation and tourism will not strongly recover soon as one economist has said.

In principle, tourism can recover only when transport infrastructure, healthcare, services, shopping and entertainment return to normal.

Some analysts predict that the tourism sector, like a compressed spring, would bounce back strongly. However, this hasn’t happened, because the spring was compressed too long.

Businesses now need big support to survive the pandemic. They need capital to make money to pay debts.

“No one does business with just his or her own money, but with capital from many sources, including financial institutions, funds and banks. Money is what businesses must have. Also they need to have other conditions as well,” Ky said.

Regarding the ‘other conditions’, Ky mentioned the Government’s Resolution 128. The document switched strategy from ‘zero Covid’ to ‘live together with Covid. However, this is just a necessary condition, and there need to be sufficient condition as well.

Currently, the Government still lets local authorities make decisions on measures to fight the pandemic. As a result, the measures are different, causing difficulties for businesses.

Businesses are most afraid of the inconsistency of policies. They may be allowed to open today, but told to close doors tomorrow.

The tourism industry is still running, but in constant anxiety. In mid-June, Quang Ninh tourism announced its opening and began receiving bookings. But just two weeks later, it had to stop all activities.

When reopening the tourism sector, it’s necessary to recover transport. Vietnam has gone slowly in resuming international flights, Ky said. The tardiness not only affects the tourism industry, but also the supply of input materials for domestic production, and goods circulation. If Vietnam is slow in resuming international flights and reopening tourism, it will lose in a market with many strong rivals.

Nguyen Thi Ngoc Thuy, rector of Hoa Sen University, said the number of tourists Vietnam lost over the last two years is equal to the number it can receive in 5-7 years. So, it may take that much time to get the same number of travelers if risk management is poor.

A study found that the number of tourists booking tours is relatively high. Once they no longer hesitate to travel, prices won’t be a problem for them. Instead, they just want high-quality, safe tours. Instead of setting too many requirements, provide travelers with enjoyable journeys.

The General Statistics Office (GSO) reported that the number of international tourists to Vietnam in December 2021 increased by 14.2 percent compared to November.

Ngoc Ha

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