According to the Provincial Head of the Bank of Indonesia, the majority of a tourist’s budget gets spent on food and beverages during a visit to Bali. Speaking at an event held in Sawangan in Nusa Dua, Head of Bank Indonesia’s Bali Province Representative Trisno Nugroho, revealed that 65% of tourist spending is dedicated to food and drinks.
Nugroho told the audience during a discussion, ‘Income from airline tickets, hotels, for example [are received by] the company’s hotel in Jakarta, there is a tax to the center. If tourists eat here [in Bali], food and beverage are around 65 percent, then staying in five-star hotels is a big value’.
He elaborated using an example of a mid-to-high budget tourist staying in five-star hotel. Using a budget of USD 1500, he claims around 65% of that will be spent on food and beverages. He said, ‘About the calculation, let’s say 5,000 to 10,000 people live in hotels a day, multiplied by 1,500 dollars, multiplied by 65 percent, that’s about what companies in Bali can get in [revenue as a] hotel’.
Nugroho made the point that the food and beverage sector in Bali should not be overlooked when it comes to business planning and promoting tourism. He noted that the presence of the G20 Summit in Bali will boost the income of dining establishments in and around Nusa Dua in particular. He shared his observation that international events will be key for food and beverage businesses and operations to focus on in the near future.
He said, ‘Next year, there will be 15 international events officially held, there are others that may not be official because the hotels have not been released, next year Bali’s economic growth is estimated to increase to 5.20-6 percent on average, if 2022 it is 4.7 percent’. Suggesting that food and beverage businesses and hotel operations can predict a boost in the year to come.
Insights shared by Nugroho were echoed by the Chairman of Bali Tourism Board (BTB) Ida Bagus Agung Partha Adnyana. He said, ‘It is estimated that cafes, restaurants and beach clubs around South Bali alone can pocket a turnover of IDR 3 million to IDR 1 billion per day [for beach clubs]. Making the restaurant and cafe business grow more than 100 percent’.
Bali has welcomed dozens of new hotels, beach clubs, cafes, restaurants, and bars since borders reopened in February this year. Dozens more tourism venues have re-opened their doors after luxury refurbishments, many of which have completed a total overhaul of their food and beverage offering. Bali is well regarded for having some of the best dining establishments in South East Asia, a huge lure for thousands of tourists every year.
There are concerns by some players in the tourism sector that travelers will become more budget conscious in the next year. While Bali is on track to smash tourism targets in 2022, and into 2023, with the war in Ukraine, cost of living crisis and rising fuel prices affecting flights, many travelers are having to make cuts to their holiday budgets, even put the idea of a holiday on hold for the foreseeable future.
Concerns about the impact of the global economy on travel trends in Bali have been raised by the Bali Tourism Association. The group is calling on the central government to scrap the IDR 500,000 visa on arrival fee. The visa now costs USD 32, which adds an additional $128 to vacation for a family of four.
They argue that travelers are looking to visit other destinations nearby Bali where their travel budget can stretch further. The Bali Tourism Association noted that Thailand’s 30-day visa on arrival is free for most holidaymakers, making it a more appealing destination for some.
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