Stakeholders brainstorm to come up with a solution to undercutting

Self regulation was one of the means suggested by the tourism stakeholders  such as members of the Association of Bhutanese Tour Operators (ABTO) and Tourism Council of Bhutan (TCB) along with several tour operators   in a consultative meeting held  yesterday on how undercutting could be curbed.

“This means that each tour operator should self regulate on such practices,” said the Media Focal Person of TCB, Damcho Rinzin.

ABTO along with TCB and the concerned tour operators will create awareness on the minimum tariff entitlements through websites in national and international levels. The local tour operators will be notified by TCB and ABTO.

The plan is also to regulate the minimum requirements to be tour operators. TCB  would thoroughly monitor the space of the office, the equipments and the number of staffs of the company. TCB should be more vigilant on the regulations of the clients.

The last plan that was discussed was to enforce penalties starting with cautions, suspension and cancellation of the company’s license if found that it is found practicing undercutting with evidence to back up.

“The most difficult problem that we all are facing is to get evidence which is why we are not able to curb this issue till now,” said the Vice Chairman of ABTO, Kinley Gyeltshen, adding that “hopefully with these plans the issue will be curbed soon”.

It was also discussed that not only will TCB impose penalties, it will offer incentives, too to tour operators.

“The meeting was mainly to come up with a solution to curb the issue of undercutting as  it is very easy to accuse someone but solutions are what we need as a team,” said Kinley Gyeltshen.

TCB while taking part in travel fairs should also be aware and monitor what is happening in the market to check on undercutting.

There are systems that can keep undercutting in check like the Visa online system where one cannot endorse the visa online and the hotel classification system.

“We are also working on the joint monitoring system with the stakeholders and these systems will keep a check on such practices,” said the TCB focal person.

In the long run, the tourism council does not see undercutting as a sound business.

According to some, it will slowly phase out because there is no sustainability of such business.

It was also discussed that if tour operators sell at a rate which is lower than the minimum tariff, then TCB could serve a notice to the company.

There will be more discussion on this issue to come up with solutions to the thriving problem of undercutting.

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One comment

  1. A case of the big tour operators trying to make smaller ones go out of business. The actual fact is that big tour operators are actually more guilty of undercutting than the smaller ones. For bigger tour operators, even making a net profit of USD 5 per person can allow them to survive, while it would be impossible for small operators to survive on such small margins.

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