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Shocked hoteliers denounce ‘corrosive impact’ of OTAs

February 8, 2018 Headline News 1 Comment Email Email

Giant global online travel agencies are having a “corrosive impact” on Australia’s accommodation businesses, an industry body has charged after viewing the results of a new accommodation industry survey.

The Accommodation Association of Australia’s annual survey of accommodation businesses, which drew more than 400 responses, found that:

  • The single most concerning issue to accommodation businesses was online travel agencies (which include and Expedia);
  • Only 41% of respondents saw an improvement in the economic performance of their properties, 28% reported that economic performance had stayed the same, while 27% said economic performance had declined; and, for operators whose economic performance had declined,
  • The single biggest factor contributing to this decline was identified as competition from online travel agencies and other operators.

Accommodation Association chief executive, Richard Munro, said the annual survey provided an accurate snapshot of the views of operators of accommodation businesses across Australia and therefore helped determine the Accommodation Association’s priorities.

“The clearest message from this year’s survey is the damage that giant global online travel agencies are doing to accommodation businesses, many of which are small businesses which are major employers in their local communities,” Munro said.

“This distinctly contrasts with the likes of offshore giants and Expedia, which are making millions of dollars each year from our industry, yet they employ very few staff in Australia.

“What’s more, most if not all of the profits these global behemoths are making flow straight overseas and they pay little or no tax in Australia, unlike local accommodation businesses.

“On behalf of our industry, the Accommodation Association will continue to push for major reforms to online travel agencies in 2018 which rein in their free-riding on Australia’s accommodation and tourism industries,” Munro said.

Other notable results from the annual survey include:

  • The second most concerning issue to accommodation operators is the lack of regulation of non-compliant accommodation, e.g. Airbnb; and
  • The biggest workplace relations concerns are public holidays and penalty rates.

“The recent changes to penalty rates have allowed important parts of accommodation businesses, such as restaurants, to trade more frequently instead of being closed due to the cost of wages being unviable for operators,” Munro said.

“Any move to roll back these changes will have a direct negative impact on local jobs and services provided to visitors.”

Edited by Peter Needham

Currently there is "1 comment" on this Article:

  1. Andrew North says:

    Until accommodation operators all start writing letters of complaints to our Prime Minister, Minister of Taxation and Minister for Communications NOTHING will change.

    If you are happy to have the OTAs skim a minimum of 15% off your income, then keep being lazy and don’t do anything.

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