Future of SMEs in tourism

Dimitrij Piciga M.Sc. Director of Slovenian Tourist Board

Role of SMEs in tourism

Mix of small number of large (often multinational) businesses and large number of SME´s (often family run);

SME’s are of strategic importance to economies like Macedonia and Slovenia:• Contribute to growth in employment at higher rate than larger

companies;• Help in the restructuring and streamlining of large state-owned

enterprises;• Provide Economy with greater flexibility

SMEs in EU tourism

European tourism is largely an SME-dominated sector 99% of firms employing fewer than 250 employees 92,4% employing fewer than 10 employees Tourism SMEs represented 7,4% of total SMEs in Europe 6,5% of total turnover of European SMEs is generated by

tourism SMEs

Funding applications Skills gap – how to market products Sense of isolation post business start-up phase Suitably qualified staff E-Commerce facilities - Merchant accounts Lack of cohesive multi-agency approach to planning

and development of small scale tourism projects Lower profitability – absence of economies of scale

Hurdles for tourism SMEs

Development of e-commerce for SMEs – Macedonian government portal www.emarketplace.org.mk.

Opportunities for new Regional Tourism Partnerships Training – Need to be flexible, focus on Mentoring

and Coaching. Examples:• E-Biz Online Management Training Center - www.ebiz.org.mk• TWIGS Initiative - www.twigs.ie

Solutions

E-Marketing Toolkits, Familiarisation visits, and customised marketing partnerships are valued by Tourism SMEs” Canadian Tourism Commission Feb 2005

“Tourism does not function in a vacuum”(Mintza & Pappadopolus 1985)

Destination Perspective - Leadership,partnership, ownership!

How can the objectives of developing and marketing natural resource tourism opportunities be best met and balanced with the needs of small communities, individual businesses and regional bodies within the region?

Simple! Only an integrated multi-agency approach will work - facilitated by partners, BUT coordinated locally.

Partnership represents a more complex way ofdoing business moving from competition tocooperation to collaboration and the task is not aneasy one.

Business Perspective -Partnership is the key to sustainability and success

Co-operation and clusters key to competitiveness – product linkages.

Opportunity to develop and present clusters of offer such as Spa and Tourism farms under umbrella of Macedonian national tourist portal - (www.exploringmacedonia.com)

EXAMPLES:• KraleMarkoCult (www.kralemarko.org.mk)• USAID – Tourism Cluster• Health Farms of Ireland (www.healthfarmsofireland.com)• Horse Holidays in Cumbria (www.horseholidaysincumbria.co.uk)

Comment: In regions where niche tourism has worked – partnership, networking, collaboration and innovation abound

Form value chain built on linkages and interdependencies among players

Achieve synergy and economic advantage in terms of market entry, access and penetration

Shopping analogy

So why do clusters work?

Potential for Natural Resource Tourism

Macedonia is an ideal environment for developing compelling NRT product offerings

Macedonia needs to develop plans for sustainable marketing and product development

Need for real help to find ‘best fit’ for bringing product-to-market

Political will & inertia combined with vision & leadership

Thank you for your attention!

dimitrij.piciga@slovenia.info