Some
hard truths about holiday prices during school holidays
It was some time last week that I found
myself involved in debate on twitter, where I actually ended up defending, of
all businesses, Centre Parcs, against the accusation they were ‘profiteering’
from the fact some people can only take their holiday(s) during school
holidays. What quickly materialised, judging by the comments made by various
people contributing to the debate, was an alarmingly low level of understanding
of why holiday businesses often use a fee model that has different rates for
different times of the year. Or maybe I should say ‘Have to use…’ Having
reflected on the debate a bit more, I thought I’d share some insights from
within ‘the industry’.
What may be a good starting position is to
state that most holiday businesses would much rather have a flat charging
structure all year round. Yes honestly! Yet, very few do, and there are good
reasons for that. For the record, ‘greed’ isn’t one of them! When we started
Mazzard Farm some 6 years ago, I for one was adamant that we would keep price
differences between low, ‘shoulder’ and peak season to an absolute minimum. As a result, our very first set of rates saw summer peak rates at just 40% or so above the
lowest rates in winter. It didn’t take us long to realise it was going to cost
us dearly: the small number of peak weeks (6 out of 52) literally flew off the
shelves, yet we saw almost no-one booking any of our breaks in winter, spring
and autumn! You could say we learned the hard way. But we learned!
So why – you may ask – is a carefully
designed fee structure, which may include some large differences for the same
cottage from one week to another, essential in your business? Aren’t you just
ripping off families with school-age children? Allow me to try and explain:
- Supply and demand – in Britain, there are just 10 weeks in the year (indeed, the main school holiday weeks in Spring, Summer and Autumn), where demand usually outstrips supply. It is in this very short period where a large number of businesses in our industry will have to earn as much as 50% of their annual turnover, simply because these are the only 10 weeks of the year where this opportunity exists. Without these 10 weeks, most of us would not have a business to run!
- ‘Forcing’ demand – by having different rates in different weeks, we encourage those ‘who can’ to book their holidays outside of the main peak weeks. Just imagine how many more people would be after that lovely cottage in the middle of August if it wasn’t for the fact they can actually book it cheaper in June or in September?
- Running a year-round business – To say that the holiday market in the UK in the 42 weeks outside the key holiday weeks is a competitive market is an understatement! Many of us have quite a few months each year where cash flow is actually negative (meaning: we spend more than we invoice). So to try and make sure we attract an as high as possible level of business in those weeks, we simply have to make sure we are as price-competitive as we can be.
And there are two key factors that have
made this worse in recent years: with people having tightened their belts as a
result of the recession, far fewer ‘cheeky’ short breaks are being taken by
people during Spring and Autumn, meaning the pressure on holiday businesses to
‘make up’ during those weeks less affected by the economic downturn (most
people will aim to NOT cut out their man summer break) is even bigger.
The second factor is the mandate from our
current Education Secretary, Michael Gove, to ban outright any 'non-school-holiday' time off taken
by school children. So where in the past a family may have been able to go for
a long weekend break by ‘keeping’ the children off school during a Friday or
Monday, this is now no longer a realistic option, which is impacting heavily on
people deciding to go away for a weekend (as ‘what is the point as you already
have to travel back on the Sunday?’ some argue). Here at Mazzard Farm we
have seen a dramatic decline in such breaks, and where people do take them,
almost none stay until Monday morning!
It is for all these reasons that we have
been advocates for a long time of the spreading of holidays across the country.
For the whole of England to enjoy their summer breaks in one or more of the 5
weeks between late July and late August is just crazy. Ask yourself, if a
small country like the Netherlands – with a quarter of the UK’s population -
sees the need to spread their summer holidays over 9 weeks (across 3 regions),
and has done so successfully for many years, then how come this has never been
properly debated – leave alone tested – in the UK? I for one am convinced that
summer holidays will become cheaper (supply vs. demand!), and holiday areas and main roads less
crowded, if such a model was adopted in Britain.
Or maybe, if we do feel we need to be so
hard-line on school attendance, just give every child one or two days a
year ‘off’ at a time of their (parents’) choosing? Surely all schools now have
the hardware in place that records attendance, so keeping a tab on this would
be easy, and families can have some real quality time at a time when a weekend
break doesn’t cost the earth. At Mazzard Farm we often welcome extended
families on a family weekend, with young and not-so-young having a great time
together. I don’t think anyone will ever convince me that a get-together like
this every once in a while is less important than being present during all 40 or so Monday
morning assemblies at school….. And for the record, I make this comment first
and foremost as a parent, and much less as someone who happens to be running a
set of holiday cottages!
So I hope this has helped clear up a few
misunderstandings, and that the price of your holiday is based on hard economic
facts, rather than greed. And that there are things we can do as a nation to
somewhat alleviate ‘the pain’, if only there was the willingness to do so! And
finally, there is of course a silver lining: most families only ‘suffer’ from
this issue for about 10 – 15 years in their lives, meaning there are many years
left to benefit from those great, low, off peak rates. Well, unless you are a
teacher I suppose…..
Ruud Jansen Venneboer
Owner, Mazzard Farm holiday cottages
