The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The former Minister of Tourism yesterday questioned his successor's decision to amalgamate four US offices into two, saying: "You can't stop growth in the middle of sowing the seeds."

Obie Wilchcombe told Tribune Business that Dionisio D'Aguilar should have given the Washington D. C. and Los Angeles tourism offices "a chance for another year or two" before deciding to combine them with the New York and Houston locations, respectively.

In particular, Mr Wilchcombe questioned how the Minnis administration would be able to successfully market Grand Bahama as a TV and film location without a strong, permanent presence in Los Angeles and Hollywood - the global entertainment industry's hub.

The former minister was responding after Mr D'Aguilar confirmed the two consolidations, which are intended to save $1 million in annual costs. The new Minister of Tourism said his ministry had no choice but to find such cost savings, otherwise it would have to slash its 'reason for being' - its marketing and promotional spend.

Mr D'Aguilar suggested to Tribune Business that the Los Angeles and Washington D.C offices had delivered little value since they were opened under the former Christie administration some two to three years ago.

And he argued that the Bahamas needed to adjust its marketing and tourism business model, given that "at least 50 per cent" of this nation's stopover visitor base purchased online, rather than through the travel agents serviced by his Ministry's overseas offices.

"We've recalled 12-15 people back to Nassau, and the savings will be $1 million," the Minister told Tribune Business, denying that any jobs would be lost as a result.

"We're basically trying to determine what's essential to our performance in the US, and what can be done in Nassau. If we feel those positions are not essential in the US, we recall them back.

"This takes into consideration that we've had a 20 per cent cut in our Budget, and we're trying to spend the people's money wisely. If we cut nothing, then that $14 million [Budget cut] comes right out of our marketing Budget," he added.

"We've got to make funds available to do the marketing. That's our primary function: To sell and market the Bahamas. If there's fat we'll cut it to free up money for our marketing mandate, and attracting stopover visitors to the country. We're looking at the low hanging fruit."

But Mr D'Aguilar's comments, and Mr Wilchcombe's response, also highlight significant differences between FNM and PLP administrations when it comes to marketing an industry that accounts for more than 60 per cent of Bahamian GDP output.

The former minister yesterday explained that the Washington D. C and Los Angeles offices were opened in a bid to expand the Bahamas' US source markets beyond its traditional Florida and north-east corridor staples, and grow airlift to this destination.

Mr Wilchcombe said he believed it was vital to have 'boots on the ground' and a physical Bahamas' presence in these areas, as it was the only way to cultivate the business relationships that would boost this nation's tourism business.

"The reason I had those offices open was I thought it important to nurture those markets because we'd been out of them, and the way the US economy grows, you've got to have a presence," the former minister told Tribune Business.

"I thought it was important for us to re-open those markets and maintain them. Obviously there's a cost, but you have your people on the ground in a more competitive environment than ever before.

"You must have persons on the ground to market it, and get more airlift. We needed to get more airlift to keep average hotel occupancies up to 75-80 per cent."

Mr Wilchcombe added: "I'm from the old school. I don't criticise the Minister; I know what it is to walk into that chair. I understand his position, but you've got to spend money to make money and be out in the market.

"With so many competitors out there, and spending considerably more than I have, I have to use human resources to build relationships. I find it more important to have the bodies there. The work is over there."

Suggesting that the tourism office consolidations may have been premature, the former minister said of his successor: "I thought he'd give it a chance for a year or two to see how it works before making a decision.

"You can't in the middle of sowing the seeds stop the growth."

Budgetary and fiscal pressures seem to have forced Mr D'Aguilar's hand, but Mr Wilchcombe argued that Los Angeles was important to the Bahamas for several reason, not least because it and other US west coast cities could provide an air link for Chinese tourists.

He added that the city could also be vital to the Minnis administration's Speech from the Throne pledge to market Grand Bahama as a TV and film location.

"The Government wants to establish a film centre in Grand Bahama," the former minister said. "Maintaining an office in Los Angeles assigned to develop and sell the idea to film studios, producers and directors et. all should be considered."

Mr Wilchcombe then emphasised why he thought the Washington D. C. tourism was required, saying: "We established a relationship with the Washington Redskins to build a presence in their marketplace.

"Co-branding with such a major brand gave the Bahamas a major presence in a powerful city. Several months ago, the team's iconic players came here for a weekend and brought with them a good number of guests.

"The potential is enormous. With a Bahamasair direct flight from Washington, tourism growth from the Washington, Virginia and surrounding areas will follow."

But, rather than 'boots on the ground', Mr D'Aguilar indicated that the Ministry of Tourism will increasingly focus on electronic and social media marketing during times of fiscal austerity.

"At least 50 per cent of people coming to the Bahamas buy online," he told Tribune Business. "Our business model has changed; we need to change with it.

"Do you need to build an office to move into this area? You can build satellite offices and build from there. The requirements for offices, rent and administrative personnel to run them are no longer critical. We want people on the road to perform our number one mandate, which is to grow the destination."

Implying that the Los Angeles and Washington D. C. offices had failed to deliver 'value for money', Mr D'Aguilar added: "The money didn't grow, and we spent all this money, and we don't think this [the consolidations] will have any effect on the MO of stopover visitors."

The Minister said the consolidation idea had come from his staff at the Ministry of Tourism, and was not something being driven by himself.

"This is what the technical people suggested," he told Tribune Business. "This is not me. I asked them where we could save money, and this is what they came up with.

"I find it odd that people expect us to keep the status quo. Given that we are Budget and resource challenged, we need to focus on ways to spend the people's money wisely. We can't keep operating the same old way when your Budget has been cut to reduce the deficit."

Mr D'Aguilar said that unless the Ministry of Tourism and other government agencies found cost savings, the Bahamas will "be back in the same position one year from now - running huge deficits and facing another downgrade".