All-Inclusive holidays

All Inclusive holidays

Tour operator First Choice, part of TUI, markets all its holidays as all-inclusive. Other tour operators are also keen on this model of tourism . But what does the resurgence of the all-inclusive model, where tourists are invited to ‘leave their wallets at home’, mean for the destinations we visit?

  • Majorica – all-inclusive holidays blamed for loss of local businesses. In September 2011 local businesses organised a day of protest against the all-inclusive hotels
  • Turkey – research found only 10% of tourist spend from all-inclusive holidays found its way into the regional economy, with even less reaching the immediate local area
  • Mombasa, Kenya – World Bank states all-inclusive beach holidays contributed the least economic benefit
  • Kenya – 87% of tourists go on all-inclusive holidays and yet over half of local people live on less than 1$ a day
  • Jamaica – all-inclusive hotels attracted tourists in the short term but blocked development of other types of tourism, leading to increased tourist harassment (vi)
  • Dominican Republic – all-inclusive holidays blamed for restaurant closures and increased negative attitude towards tourists
  • Goa, India – ‘enclave tourism’, local taxis and guides losing business to all-inclusive resorts

Clearly, there is market demand for all inclusives: we all want holidays and in the current difficult economic times, all-inclusives offer us the opportunity to feel assured that we can afford such a holiday. You can see how from the customer’s perspective, the guarantee of a fixed travel budget is attractive. Tourists choosing all-inclusive travel packages believe they will be in safe hands, with a quality product at a manageable price. Operators can enhance their control over the quality of the end product, and hotels can increase their efficiency and predictability of demand.

However, this tourism model has serious implications  for employees, other local businesses, the destination economy, and the tourist experience in terms of meaningful cultural exchange.

Our arguments are simple:

We have researched  labour conditions in mainstream all-inclusive hotels  used by all the mainstream tour operators in five different popular destinations for our latest report –  Labour Standards, Social Responsibility and Tourism. The results highlighted numerous issues, including these: failure to recognise workers’ rights to join a trade union; lack of training; being pressurised into working a considerable amount of unpaid overtime; and not earning a living wage. Tipping is an important source of revenue for people working in the hospitality business but the all-inclusive model results in fewer tips and therefore reduced income for many workers.
A high dependency on tourism means power relations between local entrepreneurs and residents, and international tour operators are hugely unequal. Tourism Concern has received reports conveying anger, frustration and distress from mayors and hotel associations in Turkey in describing how they had to succumb to pressure from UK operators to transform their hotels into all-inclusives.

Other local businesses, such as restaurants, shops, taxi drivers and small guest houses, all lose out to the all-inclusive model, as guests are deterred from leaving the hotel grounds. In some destinations, businesses have been forced to close, which in turn deters tourists from holidaying on bed and breakfast packages, as fewer alternatives are on offer. Local entrepreneurs from Spain, Crete and Cyprus, from The Gambia to Kenya, and from St. Lucia to Jamaica have all complained of being unable to run their businesses any longer because the footfall of tourists coming out of the all-inclusives is so low.

Analysis of an all-inclusive Holiday Village in Fethiye, Turkey, found that just 10% of the tourist spend reached the regional economy, with economic benefits to the neighbouring Sarigerme village put at even less. For example, estimated average guest spend in the village shops was put at just 1 Euro per guest per day (i). In Kenya, tourist expenditure reaching the local economy is placed at 22.8% (ii). This includes in Mombasa, where the vast majority of holidays sold are all-inclusive, but where half the population live on less than a dollar a day (iii).

Competition between the operators is so intense that margins are pushed all down throughout the supply chain. This means hotels are paid very little for each room, which means leaves them with little to pay their staff. One hotel association contact in Turkey told us that they receive €20 a night for the whole package per person. How is this sustainable?

All-inclusives can alienate tourists from the destination they are visiting and the people who live there. Positive cultural exchange is hampered, while resentment builds among local people who are blocked from being able to benefit from the tourism economy. This can lead to a vicious circle, in which tourism harassment levels increase (an issue frequently capitalised upon by the hotels themselves), which in turn deters people from leaving the hotels (iv).

It is true that all forms of tourism can be made more socially, economically and environmentally responsible. But these efforts need to start with the rights of workers and communities in destinations. The current mainstream all-inclusive model is perpetuating social and economic exclusion and inequality, while threatening the very character of the destination that tourists pay to see. This does not make for sustainable tourism.

We are calling for tour operators and hotels to take a rights-based approach to sustainability, and to undertake due diligence throughout their supply chains in order to identify and address the negative impacts of the all-inclusives power play, and race to the bottom that this entails.

Tourists can also make a difference by opting for holidays that offer a fair deal for local businesses and people.

Read our report The Impact of All Inclusive Hotels

(i) BBC Fast Track, 02/09/2011.

(ii) World Bank, 2010, Kenya’s tourism: polishing the Jewel

(iii) Akama J.S., Kieti D., 2007 ‘Tourism and socio-economic development in developing countries: a case study of Mombasa resort in Kenya’, Journal of Sustainable Tourism, Vol.15, No.6.

(iv) McElroy J. L., Tarlow P., Carlisle K., 2007 ‘Tourist harassment: review of the literature and destination responses’, Tourism and Hospitality Research, Vol.1 No.4 pp. 305-314

Guardian article (Mar 2014): All-inclusive boom leaves local workers and tour operators out in the cold