Many companies cut summer travel

Many travel agencies confirm that large groups of customers such as companies and businesses are tightening summer travel costs for employees.

Hoang An, an employee of a company based in Hanoi, said the company usually organizes a trip for employees every June. This year, the activity was canceled due to financial difficulties. An said she "didn't mind too much" because she "didn't like team building" and could spend that time traveling with her family.

However, travel companies are interested because MICE (teambuilding, meeting) group customers bring in a large source of revenue. According to statistics from the travel platform Mustgo, the total spending of companies on summer employee travel has decreased by 30% compared to last year. The main reason given is the economic difficulties after the pandemic, which has led to a reduction in entertainment expenses.

Businesses are struggling but travel costs are still increasing. Ms. Tran Phuong Linh, Director of Communications and Information Technology at BenThanh Tourist, commented that this year's summer tour prices are about 10-20% higher than the same period before the pandemic. The risk of economic recession and high inflation weigh heavily on the travel budget. This has caused the domestic MICE tourism market to decrease by about 20% compared to the same period last year.

A hotel in Da Nang with a sea view. Photo: ALC — A hotel in Da Nang with a sea view. Photo: A LC

The director of a unit specializing in travel combos said that every year they have about 15-20 regular groups of businesses booking services. Travel costs range from 4 to 8 million VND per person with the main destinations being Phu Quoc (Kien Giang), Nha Trang (Khanh Hoa), and Da Nang.

Currently, the company has about 10 corporate groups booking services for the summer, but all are new customers. Regular groups have no need to travel or have canceled their plans because of poor business conditions and the need to cut down on employee benefits.

Mr. Nguyen Tien Dat, General Director of AZA Travel, some regular customers, if they still organize trips for their employees, will maintain the same spending level as every year, about 6 million VND per person. At this level, the quality of service will not be the same as every year because all costs have increased. For example, a 4-day, 3-night tour to Da Nang from Hanoi, which costs about 6 million VND per person, has increased to 7 million VND this year. Companies are forced to change locations or choose bad flight times, and hotels are not as high-class as before.

A representative of a travel agency revealed that the potential customers of the travel agency this year are usually in the banking, auditing, and technology sectors. Companies such as garment and real estate are "quite cautious" this summer.

Successful businesses tend to send their employees on overseas trips. BenThanh Tourist recorded a 50% growth in outbound MICE guests this summer. Businesses often choose travel solutions combined with seminars, rewards, and teambuilding activities to optimize costs and at the same time create brand engagement. Countries such as Thailand, Singapore, Taiwan, Korea, and Japan are the destinations that most MICE guests are interested in.

However, Ms. Tran Thi Bao Thu, Communications Director of Vietluxtour, commented that the seasonality in tourism after Covid-19 has decreased a lot, including in the MICE market. Therefore, the fact that MICE customers do not travel in the summer is "not too serious a problem".

Tu Nguyen

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