English | Dzongkha Saturday, November 25, 2017

Undercutting in tourism industry


Mar 31, 2012

Tourism sector is the largest contributor in Bhutan’s total revenue. There are hundreds of tour operators in the country, competing in the market. The cut-throat competition has led to undercutting in the minimum daily tariff set for tourists by some tour agents.

Some of the tour operators said, if this practice is not checked, it would create serious problems in the tourism market.

“There are few operators in our country who are selling Bhutan in much lesser price than the tariff rate fixed by the government,” said Deepak Tamang, the owner of the Raven Tours and Treks. He added that this kind of undercutting is rampant in Nepal, India and other destinations.

“When we go for marketing we find that the overseas agents have already got good deal due to few tour operators. They find our rate very high and they opt for those agents who offer lower price, in that way we are facing loss,” said Tshewang Om, Owner of Om Travenza Tour and Treks.

Some of the owners of the new entrants said they are facing lots of problems. “The Government and the Tourism Council of Bhutan have told us that if the tour operators don’t follow the set rules and regulations, their visas will not be approved. While few of us are strictly following the rules, we are wondering how other tour operators are managing to get their visas approved although they practice undercutting,” said one of the owners.

Meanwhile, a group of tour operators are planning to make a draft to pledge to the government to look upon the issue.

“We are around 15 tour operators. We will be having meeting or gathering very soon and we will come up with the draft or letter to be address to the government so government along with us could discuss and come up with proper guidelines and better solutions to this,” said Deepak Tamang.

According to the tourism policy, tourists are expected to pay a minimum tariff of US Dollars 250 a day during peak seasons and 200 during off-season.

1 Comment for “Undercutting in tourism industry”

  1. “The Government and the Tourism Council of Bhutan have told us that if the tour operators don’t follow the set rules and regulations, their visas will not be approved. While few of us are strictly following the rules, we are wondering how other tour operators are managing to get their visas approved although they practice undercutting,” said one of the owners.”

    You just have to be friend the with the visa section and your visas are approved with less payment.

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