The last few months have been a very bad time for Bali. The eruption of sacred Mount Agung while not actually endangering any major part of the island’s tourism industry, still reduced it to a devastating trickle, threatening businesses and more importantly jobs as cash flows reduced to unsustainable levels.

Personal-Perspective-1

Introduce the word “sustainable” here for a specific purpose because this 100% natural occurrence, already anticipated for 50 years, has exposed the reality of the Bali business model very quickly. In its current form it is simply unsustainable.

We are taught in every business course around the world to identify risks to our business and minimise them, eliminate them or insure against them. This simply has not happened and over the last few years as everyone in the world who wanted to make a quick and easy buck has flocked to Bali to set up high volume, low margin hotels (clogging airports and streets) high volume, low margin retail outlets (“pusat oleh-oleh” gift shops high volume (sound-wise) high margin beach and night clubs, and a whole host of 100% tourism related industries.

None of these have contributed to the marketing, PR or “maintenance” of Bali tourism but revelled in their profitable catch of incoming tourists. None were ready for the disaster of the tragic reduction in tourists, and are now suffering.

I am very sorry indeed for the misery caused to the individual employees caught in this situation, but to the business who thought only to easy profit, now is the time to put it back into the island, keep your employees paid during the downtime, keep the island’s economy going from your profits over the good years and please plan for the future, be part of the whole Bali tourism industry and prepare real business plans. We need partners not profiteers.

And of course the one thing we have to learn is that to depend on tourism as your only pillar of the economy is simply too high a risk to take.

About Author :

Alistair G. Speirs

TOTEM
Volcom

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