Kerry Hotels Have A Positive Outlook For Coming Year

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Cormac O'Sullivan.

Chair of the Kerry Branch of the IHF, Cormac O’Sullivan.

HOTELS and guesthouses in Kerry have reported an upturn in business during the first nine months of 2015 according to the latest quarterly barometer from the Irish Hotels Federation (IHF).

With overseas visitors to Ireland up 12% year to date, local hoteliers are reporting an increase in business from key markets such as Britain, North America, France and Germany. The industry survey shows that 90% of Irish hoteliers are now optimistic about the trading conditions for their business over the next 12 months.

Commenting on the findings, Cormac O’Sullivan of Benners Hotel Dingle, Chair of the Kerry Branch of the IHF states that confidence among hoteliers is steadily improving as the recovery in tourism strengthens.

This is being supported by a number of pro-tourism measures by the Government such as the 9% tourism VAT rate, which continues to have a positive impact on the sector. As a result of the measure, 64% of hotels and guesthouses have increased staffing levels over the last year while 55% plan to take on further staff during the next 12 months.

“Irish tourism has performed strongly since the start of the year and throughout the summer season, with overseas visitors now on track to reach over 7.8 million by year end – a level not seen since 2007. The improved outlook for future trading conditions is providing a significant boost to tourism businesses in Kerry, including hotels and guesthouses,” says Mr O’Sullivan.

Mr O’Sullivan notes that Kerry’s tourism and hospitality sector continues to act as a strong engine for economic growth and job creation, supporting 12,000 jobs and contributing some €380m to the local economy annually. In addition to growth in overseas visitors, he says that the sector is benefitting from a stronger domestic economy with home-grown tourism starting to recover – although from a low base following years of subdued consumer confidence.

“The 9% VAT rate, in particular, is of enormous importance to tourism businesses – helping to level the playing field when competing with international destinations for visitors. With revenues being continually reinvested within the sector, the initiative continues to enable the industry to create additional employment – both nationally and locally in Kerry. This is good news for the local economy as the majority of hotels and guesthouses plan to increase staffing levels further over the next twelve months.”

“We’re achieving strong cut through on the marketing front with targeted programmes from Fáilte Ireland and Tourism Ireland helping to reinvigorate our tourism brand and image as a holiday destination,” says Mr O’Sullivan. “Growth in tourism revenues is strong from Britain in particular. We’re also seeing growth from North America and continental Europe – which are key markets for Kerry’s tourism industry.”

Mr O’Sullivan welcomed the recent allocation by the Government of funding under the Capital Investment Plan to upgrade the N22 Ballyvourney−Macroom road scheme, which acts as an important access point for tourists. He noted, however, that Kerry faces a challenge when it comes to growing air access for overseas visitors. This needs to be supported as part of a balanced regional tourism strategy. Better winter access, for example, would help build on successes to date in promoting Kerry as a winter destination.

Mr O’Sullivan states that ongoing investment in tourism product development is essential if tourism in Kerry is to live up to its full potential and create further employment.

He says: “As a destination, we have become more imaginative in developing our tourism product and in giving holidaymakers new and compelling reasons to visit. An example of this is the Wild Atlantic Way, which has helped re-energise regional tourism, providing a very welcome boost to Kerry’s local economy. It’s vital that we continue to invest in developing and marketing this initiative and don’t take our eye off the ball.”

Mr O’Sullivan also points to the growing importance that visitors place on high-quality access to internet and mobile phone services when visiting the county – which makes the rollout of high-speed broadband a critical issue for tourism Kerry. Further investment in this area is required in the near future to ensure that Kerry continues to compete for domestic and international visitors.

Mr O’Sullivan cautions, however, that growth in hotel revenues is from a low revenue base following the downturn with many hotels and guesthouses continuing to face challenging conditions. In particular, he points to the high cost of doing business in Ireland as a significant challenge, including excessive local authority rates which stifle cost competitiveness within the sector.

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