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Tourism in nepal   sep 2010
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  • 2. AGENDA OF PRESENTATION Introduction of tourism industry Visit Nepal 2011 Impact of global crisis SWOT Porters 5 force model. PEST Group mapping Value chain mgmt……
  • 3. Introduction of Tourism in Nepal Tourism was unknown to Nepal till 1950. With the dawn of democracy in 1950, Nepal open itsdoor to visitors. Nepal has great potential in Tourism as it has a lot tooffer. As per the economic survey 2008, the highest no. oftourist comes to Nepal from Asian continent(48.3%),followed by Europe (30.5%) The no. of tourist come from India is significant(26.7%)
  • 4. Distribution of Tourist coming to Nepal48.330.517.8TouristAsiaEuropeOthers
  • 5. Types of business in tourism industry Accommodation: bed &breakfasts, tents, resorts, lodges, cabins, homestay, hotels, motels, campgrounds Transportation: bus or coach driver, rental cars, airtransport operator Attractions: museums, cultural centers, mountains, rivers, Tour operators: bush tucker tours, 4wd tag-alongtours, guided town tours, adventure tours, local sightseeingtours. Tourism hire and retail: souvenir sales, art and artifactsales (Pokhara lakeside) Bookings: tour desk, travel agent, online tour andaccommodation sales restaurant & other facilities: restaurants of every genre
  • 7. Visit Nepal 2011 The government of Nepal has announced the year 2011 as Nepaltourism year and targeted to reach the number of touristsvisiting Nepal to be doubled i.e. one million in the year 2011. The recent statistics of visit to Nepal shows that the numbers oftourists are not exceeding more than half million, as the numberwere 526,705 in 2007 and 500,277 in 2008. Despite strong potential, tourism growth declined in last decadein Nepal, significantly mainly because of conflict and insecurity. However the current statistics shows that the industry hasstarted rebounding in the country, but we need to investigatewhy this sector is under performing and how Nepal can increasemarket share in an increasingly competitive world tourismmarket.
  • 8. Visit Nepal 2011 ‘Nepal Tourism Year 2011’ is a grand fete throughout the yearwhich is going to celebrate in Nepal in 2011. The concept of Nepal Tourism Year 2011 was emerged tomanage and develop the tourism industry of Nepal by cashingthe expertise view, experiences and commitment ofgovernment with public private venture. For that Nepal tourism board is continuing in the promotionalactivity with public private venture internally and externally. The campaign will continue to promote Nepal in internationalarena through its line agencies such as Nepalese diplomaticmissions abroad, I/NGOs, airlines, and national andinternational media, NRN community and Nepal’s friends andwell-wishers.
  • 9. Number of Tourist Arrival in Nepal01000002000003000004000005000006000002002dec2003dec2004dec2005dec2006dec2007decTotal No.Tourist arrival by air
  • 10. Average Stay7.929.613.519.1 9.5 10.0202468101214162002dec2003dec2004dec2005dec2006dec2007decavg. stay(days)avg. stay(days)
  • 11. Annual Growth Rate-23.722.713.9-2.64.933.52-30-20-100102030402002dec2003dec2004dec2005dec2006dec2007decAnnual growth rateAnnual growth rateBase yeartaken : 2001
  • 12. Number of Hotels108 110 110 105 95858 886 896502 539966 996 1006607 6340200400600800100012002003 2004 2005 2006 2007Star Hotelsnon-star hotelTotal
  • 13. Foreign Exchange Earning from tourism6.14.6 1.4 1.3012345672004/05 2005/06 2006/07 2007/08% total forexearningAs % of GDP
  • 14. Impact of Global crises in TourismIndustry in NepalHistorically, Nepals tourism sector has been a success story.However, from 2007 to 2008, the country experienced a sharp declinedue to the onset of a global recession and regional instability. GeographyNepal is a landlocked country between China and India. The naturallandscape consists of valleys and plains in the south and the awe-inspiring Himalayan Mountains in the north. StatisticsFrom 2007 to 2008, Nepals tourism declined by fivepercent, compared to an increase of 37.2 percent from 2006 to 2007.The majority of this decline was in cultural travel; there was actually anincrease in the trekking and mountaineering sector.
  • 15. Impact of Global crises in TourismIndustry in Nepal Economic SignificanceAccording to the 2008 Annual Report of Nepal Tourism Statistics, therewas a 52.6 percent increase in tourism revenue from 2007 to 2008.Revenue increased from approximately $231 million to $352million, respectively. Effect of a Global RecessionNepals tourism department attributes the decline to the global recession.However, economic indicators demonstrate that those who can afford tovisit are spending more money in Nepals tourism sector. Regional InstabilityAnother contributing factor to the decline in Nepals tourism was a civil warwith Maoist rebels and the Nepalese government. While the war hasended, continued fighting between political regimes occasionally preventsinternational travel into Nepal
  • 17. SWOT analysisSTRENGTHS1. Natural and cultural diversity2. Demand-supply gap3. Government support4. Increase in the market shareWEAKNESSES1.Poor support infrastructure2.Slow implementation3.Susceptible to political eventsOPPORTUNITIES1.Rising income of people(internal tourism)2. Nepal Tourism year 2011THREATS1. Fluctuations in internationaltourist arrivals2.Increasing competition3. Political instability
  • 18. Conclusion Enough competitive advantages(strengths) Efforts to convert their weaknesses intoopportunities(invest for better infrastructure &services). Mitigate the threats by gaining competitive edge overthe competitors.(can hardly do anything about thepolitical instability) Make best utilization of opportunities like VisitNepal year 2011
  • 19. Porter’s 5 force model
  • 20. Porter’s 5 force in Tourism industry-HotelsThreats ofnewEntrantsThreats ofSubstituteproductsCompetitiverivalrySupplier’sbargainingpowerBuyer’sbargainingpower•Economies ofscale•Capitalrequirement•Switchingcost to buyer•Costdisadvantages•Govt policy•Relative priceof substitute•Relativequality ofsubstitute•No. ofcompetitor•Relative sizeof competitor•Fix cost VsVariable cost•Productdifferentiation•Supplierconcentration•Availability ofsubstituteinputs•Supplier’sproductiondifferentiation•Buyer’sconcentration•Productdifferentiation
  • 21. PEST AnalysisRemoteenvironmentMacroenvironmentIndustrysectororganization
  • 22. PEST AnalysisPolitical factors: It includesgovernment regulations and legalissues under whichbusinesses should operate.1. Political instability2. Frequent disturbances ( bandas& strikes, rallies etc) by politicalparties.3. Government regulationEconomic factors: Economicfactors affect the purchasingpower of potential customers andalso affect the individualcompany’s offerings.1. Inflation2. Global crisis3. Per capita income(internaltourism)Social Factors : it includes the impact ofsocial factors on a particular business @large.1. Variety in culture2. Religious significance3. Hospitable nature of NepaleseTechnological Factors: Changes in thetechnology have changed the waybusinesses operate in tourism industryeg Internet booking for tickets andholidays.1. E-commerce2. MIS3. Customer relationship mgmt
  • 23. Group Mapping- Hotels Our hotel : d lodge Location : Durbar Margh Competitors : KFC & Pizza hutHotel Del AnnapurnaNanglo & Bakery cafes Factors taken: Food valueSpeed of delivery
  • 24. Group Mapping- HotelsDlodgeKFC& PHNanglobakeryAnnapurna
  • 25. Value chainSupply chainmanagementOperationsSales &maketingservice Profit marginPrimaryactivities &costsSecondaryactivities& cost
  • 26. Value chain of tourism industry