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Increasing the local economic impact of tourism through supply and value chains. Dr Anna Spenceley Spenceley Tourism And Development cc (STAND) annaspenceley@gmail.com

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increasing the local economic impact of tourism through supply and value chains

Increasing the local economic impact of tourism through supply and value chains

Dr Anna Spenceley

Spenceley Tourism And Development cc (STAND)

annaspenceley@gmail.com

Sustainable Tourism Network Southern Africa AGM

6 May 2010, Durban, South Africa

slide2

Presentation outline

  • Ways the poor benefit from tourism
  • Tourism supply chains
  • Tourism value chains
1 seven ways the poor benefit from tourism
1. Seven ways the poor benefit from tourism
  • Employment of the poor in tourism enterprises
  • Supply of goods and servicesto tourism enterprises by the poor or by enterprises employing the poor
  • Direct sales of goods and servicesto visitors by the poor (informal economy)
  • Establishment and running of tourism enterprises by the poor - e.g. micro, small and medium sized enterprises (MSMEs), or community based enterprises (formal economy)
  • Tax or levy on tourism income or profits with proceeds benefiting the poor
  • Voluntary giving/support by tourism enterprises and tourists
  • Investment in infrastructure stimulated by tourism also benefiting the poor in the locality, directly or through support to other sectors

WTO, 2004

slide4

1. Seven ways the poor benefit from tourism

  • Employment of the poor in tourism enterprises
  • Supply of goods and servicesto tourism enterprises by the poor or by enterprises employing the poor
  • Direct sales of goods and servicesto visitors by the poor (informal economy)
  • Establishment and running of tourism enterprises by the poor - e.g. micro, small and medium sized enterprises (MSMEs), or community based enterprises (formal economy)
  • Tax or levy on tourism income or profits with proceeds benefiting the poor
  • Voluntary giving/support by tourism enterprises and tourists
  • Investment in infrastructure stimulated by tourism also benefiting the poor in the locality, directly or through support to other sectors

Supply and value chains

address both of these

WTO, 2004

2 tourism supply chains
2. Tourism supply chains

System of organizations (e.g.people, technology, activities,

information and resources) involved in

moving a product or service from supplier to customer

Andreas Springer-Heinze (2006-2) cited in Mitchell and Phuc, 2007

supply chain interventions
Supply chain interventions

Objective of interventions on tourism supply chain is to enhance the positiveimpacts of tourism on poor people by:

  • removing barriers that prevent poor people entering the industry
  • enhancing the terms on which they work
  • improving the knock-on affects that tourism operations have on surrounding communities

Ashley, Mitchell and Spenceley, 2009

traditional restaurant supply chain1
Traditional restaurant supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
traditional restaurant supply chain2
Traditional restaurant supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
option to adapt the supply chain
Option to adapt the supply chain

MEAL

If the intermediaries are ‘unfair’

traditional restaurant supply chain3
Traditional restaurant supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
option to adapt the supply chain1
Option to adapt the supply chain

TRADITIONAL

MEAL

Restaurants serving more traditional meals buy more local, traditional produce

options to adapt the supply chain
Options to adapt the supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
traditional restaurant supply chain4
Traditional restaurant supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
traditional restaurant supply chain5
Traditional restaurant supply chain

MEAL

  • Typical problems for small scale farmers:
  • Poor linkages with end users: reliance on intermediaries
  • Private sector not serving ‘traditional’ foods
  • Transport, storage and processing difficulties
  • Variable quality and quantity of stock
  • Lack of information on products private sector want
example analysis and intervention spier leisure western cape
Example analysis and intervention: Spier leisure, Western Cape
  • Strategic shift away from philanthropy towards responsibilities as corporate citizen
    • Survey of existing suppliers in relation to corporate values (e.g. local, previously disadvantaged, environmentally aware)
    • Investigation of new suppliers
  • Identification of opportunities for change
    • Stimulating change among existing suppliers
    • Development of new suppliers
  • Monitoring and evaluation

Ashley and Haysom, 2008

survey of suppliers
Survey of suppliers
  • Broad-based black economic employment
  • Employment equity
  • Procurement practice
  • Human resource practice
  • Basic conditions of employment
  • Labour law compliance
  • Corporate social investment
  • Health and safety
  • Environmental action
  • Number of employees
  • Location

Ashley and Haysom, 2008

slide18

Spier laundry development

  • New alien vegetation clearing business, brick making business, staff restaurant business

Ashley and Haysom, 2008

2 tourism value chains
2. Tourism value chains
  • Products pass through all activities of the chain in order and at each activity the product gains some value.
  • The chain of activities gives the products more added value than the sum of added values of all activities.

Foreign Investment Advisory Service, 2006

2 tourism value chains1
2. Tourism value chains
  • Products pass through all activities of the chain in order and at each activity the product gains some value.
  • The chain of activities gives the products more added value than the sum of added values of all activities.

Foreign Investment Advisory Service, 2006

4 value chains
4. Value chains
  • Products pass through all activities of the chain in order and at each activity the product gains some value.
  • The chain of activities gives the products more added value than the sum of added values of all activities.

Increasing the amount and proportion of money that is earned locally

Foreign Investment Advisory Service, 2006

slide23

Increasing the amount and proportion of money that is earned locally

Foreign Investment Advisory Service, 2006

slide25

Value chain analysis and development approach

Ashley, Mitchell and Spenceley, 2009

types of value chain interventions
Types of value chain interventions
  • Greater volume: Sell more fruit/craft/beds to customers
  • Upgrade processes: Better coordination and communication within, and between stakeholders (e.g. artisans, farmers)
  • Upgrade products: better quality service, products related to market demand
  • Add value: take on new functions and to increase revenues (e.g. processing, delivery)
  • Reduce barriers to entry: improve access the poor have to markets (e.g. linkages between producers and buyers)
  • Contracts: for members of associations; between producers and tourism enterprises
  • Diversify markets: sales locally, nationally and export – and outside the tourism industry

Adapted from ITC/ODI, 2009

slide27

1. Seven ways the poor benefit from tourism

  • Employment of the poor in tourism enterprises
  • Supply of goods and servicesto tourism enterprises by the poor or by enterprises employing the poor
  • Direct sales of goods and servicesto visitors by the poor (informal economy)
  • Establishment and running of tourism enterprises by the poor - e.g. micro, small and medium sized enterprises (MSMEs), or community based enterprises (formal economy)
  • Tax or levy on tourism income or profits with proceeds benefiting the poor
  • Voluntary giving/support by tourism enterprises and tourists
  • Investment in infrastructure stimulated by tourism also benefiting the poor in the locality, directly or through support to other sectors

WTO, 2004

thank you
Thank you!

Dr Anna Spenceley

Spenceley Tourism And Development cc (STAND)

annaspenceley@gmail.com

www.anna.spenceley.co.uk

+27 (0)72 311 5700