With the start of fiscal incentives from 2010, there has been a massive oversupply of hotels especially in places like Thimphu, Paro, and Punakha resulting in low occupancy.
However, the situation of hotels in Paro, Thimphu, and Punakha is much better as most tourists visiting Bhutan mainly visit these places but hotels in Bumthang are severely affected as the number of hotels are increasing every year but the numbers of tourists are not increasing in part due to the widening of East-West Highway from 2016 to 2018.
According to Bhutan Tourism Monitor 2018, a total of 274,097 tourists visited Bhutan with a growth rate of 7.61 percent over 2017. 71,807 were international tourists and 202,290 were regional tourists.
Thimphu, Paro, and Punakha saw the highest number of tourists last year. But, only 11,636 international tourists visited Bumthang. Jambay Lhakhang Drupchen attracted the highest number of tourists followed by Ura Yakchoe and Kurjey Tshechu.
The owner of Hotel River Lodge, Pema Dawa said, “Most tourists who visit Bhutan visit places like Thimphu, Paro, Punakha, and Wangdue Phodrang. Only less than 5 percent of international tourists and less than 2 percent of regional tourists visit Bumthang.”
Pema said, “The occupancy has decreased significantly because the number of tourists who comes to Bumthang remains constant or increase slightly and the numbers of hotels are increasing every year. Only the overflow of tourists who visits Thimphu, Paro, and Punakha visit Bumthang”.
He said, “I feel that the main reason for low occupancy is because of an increase in the number of hotels and tourists flow remaining constant. If the government could come up with a new policy to increase the number of tourists, occupancy might increase.”
He further said, that in 2006 to 2008, the hotel occupancy was above 20 percent, but occupancy has decreased gradually and this year the occupancy has dropped to 10 to 11 percent on average.
In 2008 and 2009 Bumthang had 15 tourist standard hotels and now in 2019, we they more than 30 Tourist hotels excluding budget hotels. In addition to this, five hotels expanded with more rooms and there are also eight farmhouses that are now hotels.
Another issue in Bumthang is the shortage of employees. “Since most of our youth prefer to work abroad there is a shortage of employees in our own country, especially in the hotel sector as more staffs are required in the sector. Most of the youth that we employ are also not willing to work for more than 8 months even if they are paid enough,” Pema added.
The owner of hotel Hotel Jakar view, Tandin Dorji, said, “Hotels in Bumthang have to depend on seasonal business which means we receive tourists only during seasons like Tshechus and festivals and rest of the time we receive very less tourists or no tourists at all.
The Yozerling Lodge owner Dechen Dorji whi is also the President of the Hotel Association in Bumthang said, “Not just hotels but even small shops depend on tourism in Bumthang and I feel it is important to promote our country as a destination and regarding this we have discussed with the Hotel and Restaurant Association of Bhutan (HRAB) in Thimphu and we are hopeful that Bhutan will be promoted globally.”
Dechen said, “In Bumthang, the number of regional tourists is very low. In places like Thimphu and Paro, new tourism product like biking tourism has become popular but in Bumthang, bikers are not allowed. We have put up to HRAB to allow the bikers in Bumthang too.”
He said, “Hotel business in Bumthang was badly affected by widening of East-West Highway because the travel agents failed to inform the tourists who wanted to visit during that period that it would be better not to travel at the time as widening works are on-going. Eventually, the tourists visited the place during the on-going road widening and when they went back they took with them the bad experiences of traveling to places like Bumthang and maybe not much tourists prefer to travel now as they believe that the condition of the road is still the same.”
He said that although a minimum of three flights operates in a week at the domestic airport in Bumthang, because of bad weather conditions, most flights get canceled and because of that, the number of tourists visiting Bumthang has decreased over the years too.
According to Hotel Home owner Pema Khandu, even now, during peak tourists season, the occupancy has not gone above 30 to 40 percent. He said festivals remain one of the most visited attractions in the country and tourists visit Bumthang mainly for Jambay Lhakhang Drupchen and other Tshechus.
Leki Guest House owner Aum Ongmo said, “If we just do hotel business, we cannot even pay the salary for the staffs. We have a textile business too and we take out our staff salary from the Textile business”.
She said that most of the hoteliers in Bumthang have other business as it is difficult if they don’t have other sources of income.
She said, “Leki Guest House is the second oldest hotel in Bumthang, with the first being Swiss guest house. Today there are more than 30 hotels in Bumthang and with numerous construction of hotels, hotels with better facilities take away the tourists. But in general during peak tourist season, the occupancy is good but during the lean season the hotels are left almost empty.”
Rinchencholing Lodge owner Jambay Nidup said, “On an average, hotel’s occupancy is always below 19 to 20 percent. This could be because as most travel agents are based in Thimphu and Paro, tourists who come through travel agents are mostly taken to Thimphu and Paro”.
The owner said, “Occupancy has dropped drastically over the period and today I have only two rooms occupied though it is the peak tourist season. We are expecting that more tourists would visit in the following week as most festivals in Bumthang will start from the coming week”.
He said that in a year, at least three to four hotels are constructed. The numbers of hotels are increasing but the demand remains constant and naturally the occupancy drops as more number of hotels come in.