Travel agents play a critical role in the global travel industry, accounting for up to 70 per cent of airlines’ business. They are key facilitators of domestic and international travel. The Star’s Martin Mwita spoke to the Kenya Association of Travel Agents (KATA) chairperson SHAZMIN MANJI, on the industry and future of the travel sector in post-pandemic period.
Tell us about KATA
The Kenya Association of Travel Agents (KATA) is the industry body for the travel agents’ sector. It represents businesses that are primarily dealing with airline ticketing, weather it is for corporate, business travel, medical, leisure travel and other purposes. Our mandate is to protect the interests of the travel industry. That includes lobbying and advocacy with government and IATA (International Air Transport Association). We also focus on building partnerships and facilitating business opportunities. We have been around for 43 years now with a membership of 232, majority who are IATA members.
How many destinations do you connect the Kenyan market to?
We connect the country to the world. There is no destination a Kenyan cannot reach and there is nowhere in Kenya a foreigner cannot reach through various connections.
What strategies have you put in place to grow travel and connectivity?
One of them is engaging with the government and national carrier-Kenya Airways on the open skies conversation. Obviously, the more airlines you have flying into the country, the better connectivity you have. We are also hoping we can get more information and understanding on KQ’s strategy so that we push for open skies. It is in relation to the growth trajectory that Kenya Airways has. The more seats and capacity, the more passengers fly the more trade, growth of tourism and the economy.
What challenges would come with the open skies?
As we talk open skies we have to talk about infrastructure, facilities and products in place. Let’s take Mombasa as an example, and we compare it to Zanzibar as a key competitor destination. If we were to give access to all the flights that we are asking for, do we have sufficient product available to cater for demand? And does it meet international standards? Have the products been upgraded and are we able to command a price that will then enable them to be sustainable in the long-term? We have to ask those questions. If we are going to open skies then bring the investments later, then it is not going to work. The investment has to be in place before open skies come.
How would you define the country’s domestic travel?
Domestic travel has been growing since around 2005. We have seen a steady increase and when Covid happened, the importance of domestic travel was really felt. They were the first to be able to travel and take up opportunities in the market. They played a critical role in cushioning the sector. Hotels, parks and destinations all responded by offering favourable rates. This gave Kenyans the opportunity to experience more than in the past, a trend we expect to see continue. Kenyans are passionate about their country.
How has the revenue performance been in the travel industry?
In 2019 we closed BSP sales at over $500 million (Sh61.6 billion). In 2020, we closed at $222 million (Sh27.4 billion) and January to July 2022, we had exceeded 2021 and we were seated at $242 million. That means by the end of this year we will match or surpass the sales volume of 2019. This suggests that the industry is back to recovery. During Covid, the impact was significant like everybody else in the hospitality industry. We went from sales to no sales. There were job losses, unpaid leaves and pay cuts. But as we speak, most of the companies have been able to recover though there has been loss of talent and knowledge as some people opted to leave the industry and seek employment elsewhere.
Travel agents vs tour operators, who handles what traveller?
Travel Agents handle a lot of business travellers coming into the country for meetings and conferences, but majority of leisure travellers are handled by tour operators. The economic contribution by travel agents has however not been quantified by government nor the private sector. This is something we want to do next year by commissioning a study on the same.
How much business does travel agents handle in the airlines industry?
About 70 per cent of all airline seats sold are by travel agents.
How is product pricing compared to other destinations? It is cheaper to go to Dubai than destinations in Kenya
I think if we were to compare Kenya to destinations like Tanzania, the neighbouring country is more expensive. But I don’t know how much cheaper we want the Kenyan product to get until we destroy it. Cheap has a consequence and we are seeing that for example in the Mara. But also, it goes down to economies of scale. The products in Kenya are not developed to accommodate large numbers say a thousand and more at a go. I think the biggest hotel we have at the coast can only accommodate 600-700 people. If you take a four-star equivalent product in Dubai, it can accommodate over 1,000, in Mauritius and other beach destinations, they can accommodate more which makes their prices lower. But I don’t think as a country we can go so cheap if we want value for money.
How is the cost of travel in post covid era
The cost is higher and that is one of the reasons why we are seeing the recovery of the BSP figures reaching 2019 levels, yet capacity is not the same, meaning sales volumes are there but the number of seats sold is less.
Any partnerships in place?
Post Covid-19 recovery has been and still being largely driven by collaborations. We have established solid relationships with destination management companies abroad. We are also facilitating business linkages and working with everyone mainly service providers in the industry. We also have familiarization trips to help agents understand products and be able to sale better.
Outbound travel, where is the traveller going to most?
Mostly it is destinations where visa is not required or easily available. Dubai is the number one travel destination for Kenyans going outside the country. It has easy access and is affordable whether its for business or leisure. Europe and the US are popular destinations but access to visa tends to be a hindrance especially post Covid where we have had delays in getting the travel document. But it is growing. We expect numbers to South Africa to grow with the visa waiver in place.
What is your take on the EAC single visa?
It is working well in Kenya, Uganda and Rwanda. Tanzania is the one that is yet to embrace the single visa.
What is your expectation from the government?
The economy cannot grow without travel. We are aiming at building relationship with the government especially transport and tourism ministries. There is also a need to ensure regulations tare in place to facilitate growth of the travel industry. The sector also needs support. For instance, during the pandemic, no body thought of supporting travel agents who are handling the numbers. It is our hope we can put structures that will protect sector players and allow both airlines and the travel agent industry to grow in a sustainable manner. We also need a framework that will improve payments. For instance, government can take up to six months without paying their bills. This affects the businesses where agents must pay IATA every two weeks. We need to streamline the industry starting with credit, payment solutions, financial securities, and then regulatory frameworks.
What impact did the recent Kenya Airways’ pilots strike have?
As soon as the strike happened, the airport was a mess and travel agents were working 24 hours to rebook passengers. There was a major cost implication to the travel agents and travellers. We focused more on rebooking than new business for almost a week. Such strikes are unfortunate in the industry. We have seen a lot in Europe this past summer, the impact is normally huge. We however later met with KQ management to find out how we can better work together in the future. We want to build their relationship with the traveller such that KQ is the preferred carrier. We want to be confident to tell the traveller, fly Kenya Airways.
How is demand for travel this festive season compared to last year?
Last year was chaotic. Dubai was open for tourism and suddenly locked and Kenyans had booked by thousands and suddenly they could not travel. We had a lot of cancellations, people lost money because hotels did not necessarily refund, and people had to find alternative destinations. This year is different, more destinations are open, and the volumes are significantly higher.
How can the country build a reputable travel sector?
Agents are bound by a code of ethics. I am sure you are familiar with cases where travellers have lost money to briefcase operators. We are heavily naturing the next generation, currently partnering with the Kenya Utalii College, Strathmore University, and other institutions of higher learning. We are keen to influence the next generation of travel consultants. We want to be more involved in developing the travel industry curriculum.
What would be your message to travel agents on the road to recovery?
We need to be cognisant of the fact that technology is changing very quickly. Businesses need to be alive to threats and opportunities and transition with it. They must embrace change at a much earlier stage than try to resist and then find they are not relevant or unable to operate.
Why travel agent when I can book online from my living room?
When you get stuck because of an airline strike or face any challenges when connecting. That is when you will know the importance of a travel agent. You try calling the airline, which has limited capacity to manage the consumer. A travel agent will research, find easier and affordable routes, and give you options. They will take care of you, in the event of an emergency when travelling. They offer a wholesome package from airport transfer, flight, hotel among others which makes your travel easier.
Any opportunities coming with the African Continental Free Trade Area?
One of the agendas for 2023 is to have an engagement with the industry on opportunities and future growth. One of the key opportunities is the intra-Africa travel and you will find that all the AU heads of states are committed to the Visa openness index. This will enable the African passport holders to freely move across the continent both for business and leisure. Under the African Continental Free Trade Area, Kenya has identified travel and tourism, financial services, eCommerce, insurance and legal services as priority areas. We are looking forward to tapping the opportunities.
Source: The Star
