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Business and Strategic Planning

Pearls of Wisdom

"Once identified, leaks should be immediately flagged with a red ribbon and the date and location recorded for immediate repair." EarthCheck

Business and strategic planning is an essential component in the success of any business, no matter what size or industry. Tourism businesses need to be able to effectively plan and respond to changing conditions over time, to compete in this increasingly complex and competitive market. Research conducted by the Sustainable Tourism Cooperative Research Centre (STCRC) has shown that a lack of effective business planning is one of the most pressing needs of small to medium size tourism businesses (SMTEs) today. Read more
Business and strategic planning is an essential component in the success of any business, no matter what size or industry. Tourism businesses need to be able to effectively plan and respond to changing conditions over time, to compete in this increasingly complex and competitive market. Research conducted by the Sustainable Tourism Cooperative Research Centre (STCRC) has shown that a lack of effective business planning is one of the most pressing needs of small to medium size tourism businesses (SMTEs) today.

Business Operation Tip

Overcoming seasonality of demand within a business and a region is a key challenge for tourism businesses in terms of staffing, cash flow and managing costs.

 

The tourism sector is primarily a service industry where the customer comes to the product, rather than the other way around. This creates unique challenges for tourism businesses. Research has highlighted some of these challenges which tourism businesses need to address in their planning processes:

 

  • Seasonality of demand including low, high and shoulder seasons and even weekly fluctuations in visitation;
  • Understanding visitor market characteristics and demand;
  • Understanding external trends and influences that can impact on a business;
  • Sourcing a trained and professional workforce;
  • Lending arrangementsand taxation regimes which are not always conducive to SMTEs;
  • A lack of government understanding and/or recognition of the value of tourism in some areas;
  • A failure to recognise the potential benefits of industry clusters and collaboration;
  • Industry fragmentation and a proliferation of membership organisations;
  • Scattered and difficult to locate business research information
  • Planning for risks and crises
  • Single use nature of assets such as accommodation facilities have limited alternative uses; and
  • High capital intensity and ongoing fixed costs to operate the business and continue to meet market demand.

 

Business and strategic planning are not a one-off process, they are cyclical in nature and regular review and monitoring needs to be undertaken. Business planning should be undertaken on an annual basis while a strategic review of the business should be undertaken at least every three years.




The following sections provide further detail on the key steps in business planning – undertaking a situation analysis, developing strategic planning documents and aligning business planning with destination planning.


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