Tourism was giving another boost to supporting industries in their pre-COVID-19 growth phase. But in the year of the pandemic, it was the hardest hit sector and as a result, the effects were passed on to others. For 2021, signs of recovery have appeared and the expectation of tourism-related businesses is higher. Hotels have entered the normal cycle to welcome vacationers and orders from companies supplying personal hygiene products and accessories have increased. Rental cars also declined in the year of the pandemic, but as movement and demand for distancing increased, the market is expected to revive.
By Nertila Maho
Tourism was growing from year to year, culminating in 2019 with 6.4 million arrivals of foreign nationals in Albania. The domino effect brought about by the growth was also felt in a number of other industries closely related to “hospitality” (with companies offering a dedicated range of cleaning and hygiene to hotels), car rental, travel agencies, tour guides, entertainment and relaxation. , water sports, agritourism, cuisine, souvenirs.
But as everyone started to keep up the pace and head towards investment, the pandemic dealt a sudden blow, changing expansion plans, making them more creative in finding other forms of survival, or simply forcing them to closed the shutters (cases of travel agencies) temporarily.
This was expected for the supporting sectors, in conditions when tourism was the hardest hit by 2020 and foreign spending in Albania, according to the Bank of Albania, halved, reaching 989 million euros. But the removal of Albania from the list of countries at risk, the removal of restrictions, by not asking tourists who visit us for mandatory quarantine in the countries of origin, the progress of the vaccination process, are serving as reasons to believe that the current year will be The best. What is known for sure is the fact that the pandemic cannot be predicted for the direction it will take and hope is somewhat intertwined even with fear.
Foreign tourists force hotels to raise standards, demand for personal hygiene products
Foreign agencies, which bring tourists in groups organized in Albanian hotels, constantly check their quality and standards. This happens systematically, before the start of the season and continues throughout the summer season.
Any non-compliance with the standard is penalized with a fine. The cooperation of several years with international companies and the knowledge of the practices has made the big hotels, especially those in the area of Durrës, to be aware of the requirements that they must meet, according to the stars they hold. Representatives of “DEA Amenities”, a company which has been supplying hotels in the country with personal hygiene products and accessories for 5 years, told “Monitor” magazine that the growth of the tourism sector in general has set new standards and the demand of hotels for this product category has grown.
“The products we offer in our portfolio are personal hygiene products ranging from shampoos, lotions, accessories such as hoods, brushes, slippers, SPA products. None of the products we offer are locally produced. They are provided by several suppliers in Greece, Italy and Germany. The activity started with some specific lines and not with great variety, adapting to the situation of the sector, which from year to year, is going through different stages of development and growth “- said representatives of the company.
The requirements from the hotels, according to them, depend on the quality and the standard they have, this then determines the products they require, which can be either only the basic ones, or entirely for the hygiene part and accessories. But does the company see expansion opportunities in these conditions?
“We have seen fit not to disperse at the moment, as we want growth to come gradually and steadily, so our focus is on hygiene products.
However, we can offer other aspects, related to cleaning products or textiles, if we see space in the market. For example, the companies we work with also offer hotel staff uniforms, towels, as well as any extra parts related to the hospitality service, ”said the company.
Their current target is mainly four- and three-star hotels.
“They are not only big hotels, but also smaller hotels, for example with 15 rooms. Although they may be three-star, they seek to offer the part of hygiene products to their customers. Note that care has generally increased. In those that are considered resorts and have foreign clients, organized tourism, the presence of hygiene products and accessory kits is mandatory, as required by foreign agencies as a standard and can not be neglected “- say company representatives.
Rental cars, the pandemic made it difficult for the sector to survive
While the organized group of tourists is one of the categories that likes to visit Albania, there are also those who come individually without contracting an agency.
They are the group of tourists who want to discover Albania alone and in this journey, in many cases, a rental car is a preferred option to travel distances from one destination to another. The fleets of Albanian companies, which were growing from year to year, under the effect of tourism, encountered great difficulties in the year of the pandemic.
No one thought about enlargement anymore. Eliana Bakiri, administrator of “Top Tour”, says that the year of the pandemic has been challenging for both agencies and the car rental market. According to her, the lesson the business learned from COVID-19 was diversification as a way of survival.
“What we realized during the pandemic and gave us up, was the fact that we were a company diversified from rent, to means of transfer, day trip and the like. The coronavirus taught us that you have to have a diversified portfolio to survive, otherwise it would be difficult “- says Bakiri. For three years, she has been living in Austria and managing distance business in all Balkan countries where she is present.
Mrs. Bakiri says that the panorama of coping with the pandemic situation from one country to another varies and in almost all states a special strategy has been required to ensure continuity. In Albania there have been cuts, drastic reductions in spending, and other elements.
“We operate in eight countries, seven of which are in the Balkans, and we also have a point in Austria. The latter, in the year of the pandemic, has been closed, but we had maximum support from the state. We have managed other countries ourselves and we have managed not to go bankrupt. It has not been easy, as we reduced costs to the maximum, we also cut staff.
Practically, we only kept the key staff. In Albania, we gave part of the company to management. This means that we told employees to open their own companies and use our assets, but on the condition that they return to the state in which they were taken. I can say that the most problematic countries to face the situation in our portfolio have been Albania and Macedonia, while Montenegro survived with the leasing part. Austria, all by state.
In Albania I can say that it was a struggle for survival. Being present in eight countries makes clear the panorama, for the way the business is supported. In Austria, where I have been living for three years and managing from here for other countries, the state pays me 75% of my salary in this time of pandemic. Reference for the Austrian state has been the turnover and profit of 2019, when we were in a normal year and during the pandemic, 75% of the money they had paid back to the business was returned to them, giving them in the form of a missing profit bonus.
As far as the fleet is concerned, we are at the stage where we do not want to expand, given the current situation. In Albania, we have 180 cars, in Montenegro, 250. In total, for the Balkans, there are about 1300 vehicles. Here in Austria we have only 20 cars.
Currently, Austria is overbooked. There is a lot of demand and the price is very good, as the market is stable and operates according to the rules. In Albania, the price is set by the car and it is somewhat more unregulated market. Here we have three lines, which are leasing, long-term cars and local lines that are preferred by Albanians and foreigners “- says Bakiri. Other sector operators claim that regardless of the situation, the expectation is that 2021 will be a better year. For the sake of distancing, there is expected to be a trend towards personal and rental cars in relation to domestic transport, but the effects of the pandemic will need time to be balanced.
Yachts, jet-skis, dinghies and tools for growing water sports
The government approved a relief for yachts last year, sanctioning that the latter would not pay Value Added Tax. This at the time was argued as a move that would spur the purchase of yachts with tourism function, pushing the industry at a different pace.
The opposition, which disagreed with the move, accused the government of favoring people close to it. Despite this initiative, today the authorities have not disclosed a one-year balance sheet on the effects of the law on the sector. The Minister of Tourism and Environment, Blendi, Klosi, in meetings with tour operators in February, underlined that he had an interest in registering yachts under the Albanian flag.
“We very much hope that 2021 will mark dozens of international vessels to be registered under the Albanian flag. The first requests have arrived and the first registrations will take place in the coming days, but this will be a process, which will mark a complete change of the Albanian fleet registered in the Albanian flag, affecting the coast of Saranda, the coast of Vlora, Shengjin, Velipoja, Durres and the entire Albanian coast “- Klosi would say, underlining that the abolition of 20% VAT had made Albanian operators more competitive than many other countries in the region and beyond.
But how do imports for pleasure boats such as yachts, jet skis or rafts actually look? Official data from Customs show that in value, imports of vessels in this category have increased in 2020. Specifically, in this group, imports in 2020 amounted to $ 1.15 million, while in 2019, imports for the same group were 545 thousand dollars. The decrease for the group had started in 2017, when from 1 million USD in the previous year it reached 733 thousand USD and the weakest year in the last 5 years is 2018, with 341 thousand USD.
