Brexit Bonus- Is it here or is this a false dawn?
If you’re a regular reader then you may be forming an opinion that I am obsessed with Brexit and yes this is the third column of the year on the subject but there’s no doubt for those of us running a business it’s the most significant change we have seen in our lifetime. Things have calmed down after the political upheaval of the last six months and the process hasn’t actually started yet in some ways things have changed a great deal since last year.
One thing that is incontrovertible whatever your opinions is that the pound has fallen substantially against other currencies. As it happens I am writing this from Spain and whatever rates are quoted on the news, I’ve just looked and credit card transactions and cashpoint withdrawls are at something like 1.05 euros/pound. In my mind and I suspect it’s the same for most people this means that I am treating prices in euros as pounds as the difference is too small to bother working out and it’s a painful experience I can tell you.
So the Europeans are coming?
It’s tempting to jump to the obvious conclusion here that we are about to see a rush of business from Europeans whose money will go a lot further in England. If I were a tabloid journalist I might choose to quote some statistics at this point- looking at the period since 1st September visits to our main website from Germany are up 12%, from Spain up 121% and from France up a massive 160%. Perhaps I’d write a headline along the lines of ‘Cornwall bracing itself for Euro tourist invasion’ however just to put these numbers into perspective the number of German visitors has soared to 276 and we had 28,000 visits from the UK in the same period. For our business foreign tourism is a red herring, the opportunity is definitely with the ‘staycation’ visitors.
Sentiment and the shoulder months are key
Tourism is very very sensitive to people’s state of mind. I’ve written before about people effectively looking for a reason not to rent your cottage- they have found 50 to choose from and they need to whittle that down to a sensible shortlist. The same process is currently going on at an earlier stage in households across britain- shall we go abroad or go to Cornwall next year? It’s easy to think about the family spending a lot of money on 2 weeks in the summer holidays but this is not where good years are made or lost. We always sell all the peak weeks so it’s Spring and Autumn that really count and these are the pre and post children customers. They may or may not be affluent but my feeling is that they are definitely price sensitive. We’ve all been there- you pay £150 for a hotel room then won’t drink a beer from the minibar because it’s £5 for a small bottle. It’s not that you can’t afford the fiver and it’s not that you don’t want the beer but once you get it into your mind that something is unreasonably priced you start to believe everything is and that’s what is happening to thousands of people like me in Europe at the moment.
Are we seeing an effect?
As I’ve written many times I always look at the data which often shows a different picture to what I think is happening. This time my feeling that we were having a very good autumn has proved to be borne out by the figures- September is 15% up on last year, October is 5% up with several weeks to go and most promising of all advance bookings for 2017 are 14% up on this time last year. Everything is pointing in the right direction so despite my severe misgivings about the result it would seem that at the moment we are reaping the benefits of the country’s choice.
Bumper Brexit years to come or will the economy go into reverse and bookings decline in the long term. The jury is out and we will be revisiting the subject regularly.