U.S. travelers visiting South Africa and Namibia are more likely to benefit from the stronger dollar than those visiting other African destinations.
African Travel President Jim Holden said this is because most destinations in Africa already quote travel in terms of U.S. dollars. South Africa and Namibia are the exception.
“South Africa provides the most value for money right now. Not only due to the weaker rand and stronger dollar but also because of the vast array of choice from first-world experiences in Cape Town to the wildlife attractions of Kruger. The average American can live like a king while on safari in South Africa on the equivalent of a prince's salary while the pauper can live large, as well!”
The South African rand has traded in a range of R7 and R9 against U.S. $1 over the past 24 months, so there is relatively extreme exchange rate fluctuation of their currency, explained Craig Beal, CEO of the tour operator Travel Beyond.
“When the dollar is strong vs. the rand, safaris in South Africa and Namibia are cheaper. They benefit, and other countries in Southern Africa tend to lose,” he said.
Beal explained that the trend of booking further in advance combined with the tendency toward currency fluctuations does pose risks for the operator.
“If we quote a South Africa safari in USD only and use a conservative exchange rate instead of the current exchange, we risk losing the sale on ground of price. When the client looks online to ‘price check’ their trip using the current exchange rate from the day of the quote the price of the safari will not pass what we call Internet price scrutiny’.
“The further in advance the trip is booked, the more the currency can fluctuate and the more the exchange rate must be hedged with a ‘safe’ number. This drives the USD quote price up further! For all these reasons, we typically quote our clients in foreign currency if there is significant exposure to exchange rate fluctuation. If the majority of the trip is in South Africa or there are luxury hotels and safari lodges in South Africa then we always quote our clients in rand.”
According to Beal, Zimbabwe, too, offers great value on African safaris. “The country is still somewhat plagued by the negative publicity it suffered during the past decade, and this is a major reason for the lower price.
“A six-day safari in Zimbabwe, including light aircraft transfers and spending three nights each at a lodge in Mana Pools and Hwange national parks, starts at about $4,000 per person in peak season for 2013. One only needs to read online reviews about Travel Beyond to see how our clients love Zimbabwe.”
Beal said Travel Beyond has been deliberately focusing on selling luxury safaris vs. budget or mass-market safari products. “By focusing on luxury, we were able to increase our revenue by 30% but only increase our volume by 10%. We plan on similar performance in 2012 and hope to increase our passenger count by 10% and revenue by 20% in 2013.”