Singapore’s travel agency sector gets an upgrade, thanks to more stringent regulations and a slew of initiatives aiding in the transformation of members into stronger players.
The recent spate of business closures – from the sudden cessation of Misa Travel to GC Nanda giving up its licence after 40 years in operation last year – may seem like a blow to Singapore’s travel agency sector, but in its wake the trade is encouraged by the emergence of a stronger, more efficient pool of players.
The vast majority of cessations are “orderly business closures or businesses which choose to let their licence expire for reasons such as change in business focus and retirement”, said Ong Ling Lee, director, travel agents and tourist guides, Singapore Tourism Board (STB).
The number of travel agents has remained constant at around 1,200 over the last few years, according to STB figures, although an average of 100 to 120 companies cease operations every year.
To help agents stay ahead of the game amid fast-changing technology developments and consumer travel habits, STB is banking on amendments to travel agents’ legislation – including the exemption of certain entities from requiring a travel agent’s licence and the emergence of a niche-licence tier for travel agents arranging or selling tours in Singapore – to create a “more vibrant local tourism scene”, Ong added.
STB in August 2016 launched the Travel Agent Roadmap to enhance the capability and sustainability of the travel agent industry through business transformation, technology adoption and manpower initiatives, with follow-up initiatives rolled out last year.
To expedite travel agents’ adoption of technology, STB is developing a “green lane” where a set of solutions are being identified and prequalified for funding approval, paving the way for easier adoption of technology among travel agents.
More help for SMEs
On its part, the National Association of Travel Agents Singapore (NATAS) has formed the new Business Transformation Committee to galvanise the industry towards business transformation. In 2018, NATAS will launch the Travel Technology Challenge with the objective of curating even more solutions for travel agents.
Steven Ler, acting president of NATAS, told TTG Asia that the association is also stepping up collaboration with government agencies to assist its SME members, who make up 70 per cent of its 400-strong membership. The association is also working with banks to help members with the financial aspects of doing business.
“The big boys are self-sufficient and have enough funding and resources to transform, but for an SME to find a solution is costly. Such companies and members may have the intention to transform but may not have the know-how. This is where NATAS can give support and provide the infrastructure to transform,” stated Ler.
To address the changes in the marketplace, Ler announced that NATAS is reviewing its membership categories and classifications, and changes will be made after its AGM in May to reflect the new market needs to allow niche and smaller travel agents to be a part of NATAS.
A key NATAS initiative this year is the development of a cost-effective, user-friendly offline-to-online (O2O) portal, targeted for a 3Q2018 roll-out to support SME agents’ move into the online domain, complement its travel fairs and create a consolidated travel agency platform. The portal will feature themed travel fairs throughout the year, and serve as a plug-and-play solution for agents who currently lack the ability to go online.
Ler noted: “This platform will allow more travel agents to come on board but it will also be managed with stringent criteria. The whole purpose is to attract non-members with a value proposition of member and non-member fee payment structures.”
Tackling challenges in digital era
Such trade initiatives have been a timely blessing for Quotient Travel Planner, helping the company achieve “technical growth” to expand and globalise, according to its co-founder and COO Lim Hui Juan.
The agency has adopted solutions such as a cloud-based file sharing system, a customer relationship management system and an internal staff chat and information-sharing platform. It is currently developing a chatbot under STB’s Tourism Innovation Challenge.
Lim told TTG Asia: “We’re a small company with limited resources (so) digitising processes is a cost- and time-savings initiative for us. We would prefer to spend (our) time engaging personally with clients (and see) how we can do more for our clients with technology.”
As well, Dynasty Travel has tapped STB’s business improvement fund to develop a mobile app to help customers make bookings, write reviews and contact the firm in emergencies. A revamped website is also on the way, scheduled for a 2Q rollout.
Similarly, Chan Brothers Travel – which recently launched a chatbot and a Salesforce system – maintains staff engagement and hands-on training with each innovation to ensure employees “understand how to utilise and maximise the new software or tool”, according to spokesperson Justine Koh.
Technology disruption aside, staff hiring and retention remains another key challenge faced by agencies, according to Ler.
He said: “It’s important to get support from STB in terms of infrastructure, but more importantly, for the trade to move forward in (acquiring) talent. Training would be the most crucial element moving forward to help (agents) be more focused and let the travel trade continue to progress.”
To further this scheme, the East Asia Institute of Management (EASB) last year acquired a majority share of NATAS’ training arm, the Tourism Management Institute of Singapore. EASB’s pedagogy will focus on integrating mobile technology into learning processes.
This is the association’s first step in transforming the travel trade by raising the technology confidence in Singapore’s travel trade sector, added Ler.
Retraining existing agents is an accompanying step. Lim shared that in implementing online solutions, “some of the early Gen X-ers had some grumbles… Training our staff to use the newly developed technology took time”.
Another NATAS initiative, which will be launched in the latter part of the year, is the talent portal, which focuses on skills acquisition and the crystalisation of travel agency roles.
Ler explained: “The aim is to standardise roles in the industry, conduct blind assessments and profile talent and travel agencies. NATAS is working with schools, the polytechnics and institutes of learning to build a supply pool. It is also plugging the (skills) gap.”