SCHOOL HOLIDAY PRICE INCREASES.

[SPEEDTRIPLE]

Hi all,

 

Listenning to the Jeremy Vine show on Radio 2 today, one of the subjects up for discussion was the dramatic increase in the cost of holidays in the "out of term time", or summer, Easter and half term breaks.

 

Several of the callers, and messagers to the programme suggested that all holiday companies should be made to make the school break holidays a lot cheaper, so as to stop parents needing to take their children out of school in term time, therefore paying a fine imposed. Parents are happier to pay the fine, as the fine is a lot less than the increase in the cost of the holiday.

 

I`d like to ask Clive (Richardsons) and Andy (Freedom) what effects this would have on their buisness, and how they would re-structure their buisness plan, should any Government take this sort of action?. From my own perspective, this would have a detrimental effect on those (like Karen and i) who prefer to take our holidays outside of term time

 

I`d just like to add, this is in NO way meant to be an argumentative thread, just to find out how it would effect everybody, being the hire industry, and the public alike. What do people think?.

 

 

Regards to all ...................... Neil.

[ranworthbreeze]

Hi Neil,

 

Making hay whist the sun is shinning in my mind has always been sharp practice within the travel holiday market. Sadly this has been the case for more years than I can remember. The case of being able to charge what you want because there is a demand is somewhat wearing very thin.

 

Another thing we have to bear in mind that there are moves to reduce the summer school holidays down to five weeks which would not improve the situation.

 

I am so glad that our children were out of the school system before this system of fines or not allowing children to have time off  came into being. For those of you that are caught up in it you have my sympathies.

 

Regards

Alan

[SPEEDTRIPLE]

Hi Alan,

 

Luckily, (well i think so anyway) Karen and i got together relatively late in life to start thinking of families, so it does`nt bother us whatsoever, though this June, we`re going on Maffetts new Kestrel, which is a 9 berth, and we`re taking my brothe, his partner, his two daughters, one of their partners, and his two grandchildren, but they are only 3, so it won`t apply. However, if we want to do the same in a couple of years, then it most certainly WILL affect them.

 

Looking at it from our perpective, Hire fleets (and other forms of holiday industry) need to run a successful and profitable buisness, so if by government dictat, they HAVE to operate on, shall we say, a "more realistic basis", then i doubt they will cut peak season costs, but will more than likely INCREASE low season costs. I think they call it "levelling UP, rather than down".

 

Either way, to level the costs would be much more fair, but i was wondering how imembers of the industry would see it affecting the buisness.

 

To level down, would lose vital income, so would see a cut in investment, whereas if you level up, you`re in danger of losing low seaon bookings, therefore, again loosing vital income and possible investment.

 

I can see it as being a very difficult situation, and wondered what others think, AND could this have a detrimental impact on the holiday industry.

 

Regards to all .................. Neil.

[Oddfellow]

There needs to be a basic understanding of supply and demand when dealing with this issue.

 

First, let's consider a totally different market but one where exactly the same principals are employed day in, day out - Public Transport.

 

Why is it so much more expensive to take a train journey between 5am and 9am (or whatever the peak times are)?

 

The word is Peak. This is the time of peek demand. A point in the day when demand is at its highest.

 

If we were looking at this cinically, you might think that the rail companies were profiteering out of the need for travellers to get to work. But spread your scope wider and look at how many people travel outside of the peak hours and compare numbers. They fall off a cliff. Therefore, there is no level playing field. Demand peaks at certain times and therefore prices follow out of necessity.

 

Let's put it another way, if demand for rail travel were flat throughout the day, there would be

 

1. No need for peak charges and therefore no need to increase services (and operating costs) at any point in the day
2. No benefit to the operator for peak charges as people would simply travel when it were cheaper

Nobody complains that the overnight services (when comparatively few people travel) are so much cheaper and I see nobody complaining that they can have a five berth, two cabin cruiser for just £270 a week (plus fuel) from us before 2nd April. I also don't see people fighting each other in a bid to secure it - because this is low season - demand is, well, low (despite the fact that it was 14 degrees today and we've just had a stunning week of weather with a predicted great weekend).

 

Government intevention?

 

The government is highly unlikely to interfere in a free-market such as this, but if it were to pass some kind of ruling, in all likelihood, prices would have to increase across the board to make up the shortfall, services would be restricted and restructured and jobs would become less secure; most likely a combination of these to varying extents depending on the operator.

 

Reducing the number of weeks for the school hoildays will simply decrease the peek period which is likely to push up peek prices even more with off-peek probably having to adjust upwards too.

 

As an aside

 

On the BBC Holiday Hit Squad programme last night, an average figure of £2000 was suggested as the typical summer holiday budget for a family. That seems like a lot of money to me and it got me looking at prices of boats which people often hold as being too high - remember that the Broads are the least expensive of any UK waterway. Booking a brand new boat on the Broads will set you back more than three quarters of this figure, whilst perfectly comfortable, older alternatives are available for less than half this and there are many, many more older vessels in service than newer ones. Again, we're talking about peak pricing but from a slightly different viewpoint; if you want new or newish, then choice is greatly reduced and so prices can be adjusted accordingly.

 

There's nothing wrong with this and there's no end of people prepared to hire new Broadsmans from Clive or Emblems from Ferry. I suspect that demand is outstripping supply and I only wish we have the financials to be able to build such craft. [sob]

 

 

 

 

 

 

[Hockham Admiral]

Well written, Andy and thought-provoking.   :clap

[Guest]

I can appreciate and understand Andy's answer regarding the business perspective.

 

The "peak" travel time fares is a valid analogy.

 

Broads hire companies are under even greater competition with each other offering the same services, so their prices will essentially be a balance between between maximising profit on each hire and not losing  customers overall.

 

It's more realistic to regard term time as discounted periods, and holiday time as normal price.

[MauriceMynah]

Thanks for that Strow, I was going to ask...

Why do people say prices were " Cynically Ramped up" in peak times rather than "Generously discounted off-season?" but you saved me the typing.... well you would have done had I not just typed it out!

It's all spin.  Please don't forget that the television companies priorities are to get you watching rather than to inform you. Whipping up a frenzy of anger does that more efficiently than encouraging balanced calm debate.

But then again, maybe it's me who's the cynic! 

[ranworthbreeze]

Hi JTF,

 

Very true, the media and politicians are so full of spin.

I wonder if it is the result of never doing a full days work.

 

Does the above make me also a cynic or a realist?

 

 

Regards

Alan

[MauriceMynah]

Alan,

 

I'm yet to meet a politician who doesn't do a full days work.... at least once in every four years!

 

From one realist to another!!!

[BroadScot]

If Mr Gove had his way there would be NO school holidays at all!                                                          

 

I thought Alan (Freedom Holidays) remarks were very well put.

 

Personally I cannot see the Status Quo changing soon.

 

 Iain.

[Soundings]

Unfortunate though it might be a business is a business and prices are set by market forces. It follows that where demand outstrips supply the cost of the unit being supplied will increase. Conversely if demand drops off prices reduce to encourage takers. It has been that way forever really and I do not see it changing.

[ExMemberBobdog]

Mmm, actually the relevant pages of the 'economics for beginners' textbook are not those on 'markets, demand and supply, but rather those on 'monopoly/oligopoly and price discrimination', but hey ho.

[Soundings]

Because a market is small that adds to its uniqueness and thus a limited supply. The Broads are not big enough to be able to take everybody thus there will be winners and losers or those who can and those who can't/won't pay.

[LondonRascal]

The thing is boating on the Broads, indeed I would hazard a guess to say on all waterways is very hard to forecast demand.  Sure, you know that in the summer peak season you will have more demand for bookings than that at the start of the season, but knowing how much demand that will be and will next year’s demand be greater than last years and so on is where things get tricky.

 

It obviously is a huge gamble to invest many hundreds of thousands of pounds – be it from profits or borrowing into a business to build new boats, or even to buy molds and fit them out. Boatyards surly hope doing such will make your business more attractive to the holiday makers and that segment of the market where people will either have available money to splash out or have spent a long time saving up to have something new, and special.  However if it was to not pay off – a new economic crisis rears its ugly head say, and demand falls you’ve got a bunch of very expensive new boats sitting earning nothing.

 

Unlike a hotel where you could see a trend of higher demand and having turned away customers in the past, you decide to expand either with an extension of the hotel or the purchase of another hotel in another prime location you suddenly get a lot more capacity and one would hope occupancy and profits.  In boating,  once all your boats have been booked you cannot just go and get another few to increase the capacity you’ve got your assets tied up with customers and what money has come in is that, you have to make the best of those while the sun shines so to speak.

 

Where a hotel may be able to keep a good turnover outside the peak season with a bar and restaurant and attracting couples over weekend and businessmen in the week for example – boatyards just attract holiday makers – be it a family, a group of friends or a couple. 

 

I can’t therefore see anything changing anytime soon whereby schools change the amount of time off in the summer – though I could image one less half term week off – it could well also turn out that all this press coverage and discussion makes a petition on the Governments website attract enough signatures to have the matter debated in Parliament.  It is nothing new having some time off outside of the school holidays; I know my parents did this when I was in school – to come on the Broads as it happened.  Difference is you were not fined back then for so doing it.

 

Perhaps the fact is that people have not had pay rises in many areas of business for some time now, yet the cost of living has gone up as too have holidays – they have tried to remain stagnant for a long period but they too must increase their charges at some point. 

 

Parents now may be feeling the pinch so much that they feel the best option is not to ‘downgrade’ their family holiday but to take it in term time at a lesser cost, pay a fine but overall be quid’s in and have nice holiday they can afford rather than a more basic one in the school holidays.

[Oddfellow]

 

Perhaps the fact is that people have not had pay rises in many areas of business for some time now, yet the cost of living has gone up as too have holidays – they have tried to remain stagnant for a long period but they too must increase their charges at some point. 

 

 

I've just done a quick check of this, taking two boats at random.

 

Song of Freedom's peak price in 2011 was £740.23 - in 2014 it's Dropped to £670 plus fuel.

That's a £70 difference

 

 

Absolute Freedom's peak price in 2011 was £1346.93 - in 2014 it's Dropped to £1170 plus fuel.

That's a £176.93 reduction

[donnygeoff]

WORK COMMITMENTS.....

 

They cannot fine you....

 

enough said

[Oddfellow]

Sadly, they can and do fine you.

 

There's a decent article here. http://www.telegraph.co.uk/education/educationadvice/10650927/Gove-gets-tough-on-term-travel.html

 

I have to say that, as a father of three schoolchildren and the operator of a small hire fleet, it is virtually impossible for me to take a family holiday as I need to be working when the schools are off as it's our busiest time.

[donnygeoff]

never been fined, taken kids out when I wanted to....

 

Only one left in the school system now, and as it is her GCSE year I wont take her out.....

 

The politician (can't remember his name) was perfectly correct when he said teachers do not understand about working for a living, (or something like that)

 

My eldest went on a weeks skiing holiday in term time, and no mention of me being fined for him to go on this merry jaunt....

 

the reason that myself and no other parent was fined for this week on the piste was that it was a school trip....

 

FREE WEEKS HOLIDAY IN TERM TIME FOR THE TEACHERS THAT WENT

 

[MauriceMynah]

Free weeks holiday in term time for the teachers who went?

 

I rather think not!

I fully see why there are people who see it like that, but there is a rather big "BUT" in the way.

 

Yes it's term time, no doubt about that, but the teachers are responsible for rather a lot of youngsters, any number of which may well have ideas about what they would like to be doing/drinking/smoking.

 

Holiday.... nah.... hellishday more like!