Subscribe to Print Edition | Tue., November 24, 2009 Kislev 7, 5770 | | Israel Time: 02:21 (EST+7)
Haaretz israel news English
web haaretz.com
Jewish World Haaretz Toolbar
Diplomacy
Defense Opinion National
Print Edition
Car Rental
Focus U.S.A. Strenger than Fiction Business Travel Magazine Week's End Anglo File Books
Share |
B&B revenues plunge 40%
By Adi Dovrat-Meseritz

A country vacation at a bed and breakfast is calm, quiet and pastoral - but only for the vacationers. For the owners of such country-style accommodations, business has been getting unpredictable and much less satisfying: November saw a 40% drop in revenues compared to 2008, reports the Israeli association of bed and breakfast operators.

The reason for the fall in revenues is the large increase in the number of bed and breakfast accommodations in recent years, said the association. There are now some 12,000 bed and breakfast rooms in Israel, and the industry has an annual turnover of NIS 1.5 billion. The sector employs about 2,000 people full-time and another 10,000 part-time. These numbers do not include kibbutz hotels and accommodations.
Advertisement

The director general of the association, David Kaufman, said thousands of new rooms have opened over the past five years, with average annual growth of about 30%. The supply of rooms has outstepped demand, and this has led to rates being sliced this year by 15% on weekends and 30% during the week.

So far, revenues have been 15% to 17% lower than they were last year, and as much as 20% lower for the past six months. Occupancy rates have fallen by up to 25% this year.

"A bed and breakfast that cost NIS 750 a night last year now costs NIS 550-600. If you couple the decline in prices with the fall in occupancy, which is 20% to 25%, the drop in income is tens of percent," said Kaufman.

He added that the current drop in prices comes after prices rose two years ago, when luxury accomodations were built - which raised the average price. Kaufman added that several projects under construction have been halted.

Owners managed to fill their beds during the holiday period, says the association, but since prices were lower this year, revenues were 15% lower between September and October than they were in 2008.

Of course there are other factors contributing to the industry's problems. The world economic crisis is a major one, for example. However, bed and breakfasts are a very seasonal business. Most operate only about 80 days a year, at specific times, such as holidays, summer vacation and weekends.

Dun and Bradstreet economists forecast another 7% drop in revenues for next year, and D&B says more than 12% of all the bed and breakfasts in Israel are in danger of going under, and another 50% are at moderate risk. Only 38% of bed and breakfasts are in the low risk category.

If the cloudy forecasts come to fruition, then more than 200 workers are expected to lose their jobs.

"Today, people are looking to get as much as possible - and cheap. Bed and breakfast owners are forced to pamper their customers with bottles of wine and other comforts, and the Israeli consumer is much more choosy," said Kaufman. If two years ago consumers jumped at any unoccupied room, now they wait till the last minute and compare prices, he said. "They know that if I don't have a room, they will find a room elsewhere," he added.

Owners are trying to be optimistic and are hoping for a good December, as bed and breakfasts are considered a popular winter vacation site. As to whether prices would continue to drop, Kaufman said the B&Bs were still cheaper than hotels, and he doubted that there was much more room for prices to fall due to the high overheads involved in operating a small number of rooms. But anything is possible, he added.
PROMOTION: Mamilla Hotel
Bookmark to del.icio.us  
 
' Hitler's car sold '
Unidentified Russian billionaire pays between $6 to $15 million for dictator's Mercedes.
Anti-Semitic crime rises
FBI report documents highest crime rates against, Blacks, Jews and Gays since 2001.
Special Offers
Advertisement
Eldan Rent a Car
Israel's leading car rental company offers you a 20% discount on online reservations
Protea Hills
A Retirement Village in Nature Nestled in the Foothills of Jerusalem
Date Local Jewish Singles
Ready to meet your match? Join Jdate today!
Junkyard
Junk a car - get free towing nationwide and a tax-deductible receipt
More Headlines
22:26 Hamas: Too soon to say Shalit deal is imminent
23:40 Netanyahu may ask cabinet to okay 10-month settlement freeze
22:53 Abbas: Palestinians won't launch new intifada, despite frustration
22:25 Netanyahu: We'll have public and Knesset debates on Shalit swap
21:44 ADL decries rise in U.S. hate crimes against Blacks, Jews and gays
22:03 Gaza rocket hits Israel, despite Hamas moratorium on Qassams
19:46 Report: Russian billionaire buys Hitler's Mercedes
22:25 TV ROUND-UP: MKs to debate Shalit deal; Fischer raises interest rate
23:11 Turkey Deputy PM: Our ties with Israel must improve
18:40 Rightist MKs: 'Cursed' deal for Shalit will bring terror to Israel
19:54 Brazil: World should engage Iran to push for Mideast peace
17:45 Netanyahu aide hopes PA peace talks will be renewed within weeks
20:48 MKs pass bill to allow IDF widows to remarry, keep pensions
Home | TV | Print Edition | Diplomacy | Opinion | Arts & Leisure | Sports | Jewish World | Site rules |
| Advert: Recommended Restaurants | Makom: Engaging on Israel
| Search engine marketing
Haaretz.com, the online edition of Haaretz Newspaper in Israel, offers real-time breaking news, opinions and analysis from Israel and the Middle East. Haaretz.com provides extensive and in-depth coverage of Israel, the Jewish World and the Middle East, including defense, diplomacy, the Arab-Israeli conflict, the peace process, Israeli politics, Jerusalem affairs, international relations, Iran, Iraq, Syria, Lebanon, the Palestinian Authority, the West Bank and the Gaza Strip, the Israeli business world and Jewish life in Israel and the Diaspora.
© Copyright  Haaretz. All rights reserved