Tuesday, July 12, 2005
The Economics of A Travel Guide
By the third day of our Jiazhaigou tour, I was furious mad at Mr. He, the skinny tour guide who spoke with an impassive soft tone. During the 10-hour bus ride on the first day, he, with the help from the stocky and loud driver, heavily promoted a performance called Tibetan Royal Banquet and Dance. “President Jiang Zemin proclaimed that this performance rivals the natural wonders of Jiuzhaigou. If you don’t pre-order the tickets now, they will surely sell out tomorrow.”
He peddled tickets to the passengers, three times, in a half-pressuring-half-beseeching way. My parents and I finally agreed to buy one for 160 kuais (US$20).
After the day touring the Jiuzhaigou valley, my dad went to watch the performance. It was mediocre, he reported back later. The venue was half empty, and there were Tibetans selling tickets outside for 80 kuais.
So my annoyance at being cheated boiled to anger when the next day we got the full details of our itinerary for the next two days. Here’s what we paid for:
- Got up at 6am
- Toured a Tibetan medicine shop where “doctors” in white coats explain the cure-all benefits of herbal medicine
- Toured a Prefecture-sanctioned souvenir shop where I bought a silver Tibetan bracelet and later found out it’s fake
- Toured a store selling various kinds of “all natural” yak meat
- Lunch and 4 hours touring the Huang Long Nature Preserve
- 5 hours bus ride and arrived at the hotel in a small town at 10:30pm
- Got up at 6am
- Toured a facility providing water rafting where fortunately it was pouring rain so we didn’t have to go through a rafting demo
- Toured a Qiang-minority tea garden
- Toured a factory of souvenirs made from yak horns where my mother bought a comb that, when used everyday, was to have special positive therapeutic effects
- Toured a jade factory where the manager offered us a special discount: a RMB 10,000 piece for RMB 600
- Lunch and 4 hours bus ride back to Chengdu
I was furious because it seemed half of the time we were being rushed to different shops where the tour guide and the driver could get a cut of our purchases. On top of that, I was not sure how we got on that tour bus to begin with. I paid for a tour with the China Youth Travel Service, one of the biggest and most reputable agencies in China. Instead, we were picked up by Mr. He from the Ba Shu Travels.
It was on the way back to Chengdu when my anger had yielded to a sense of irony that I had a talk with Mr. He. He explained the economics of the Sichuan tourism industry thus to me:
We each paid RMB 650 (about US$80) for a 4-day package, which was getting cheaper every year due to intense price competition. The price covered 3-nights’ lodging, 3 meals everyday for 4 days, admissions to two national parks and transportation.
Travel agencies actually lost money on each tourist with that pricing. What they decided to do then was to “sell” the travelers to semi-independent tour guides. The tour guides had to pay deposits and pre-pay all the travelers’ expenses during the trip out of their own pockets. Only when they return from the trip would they get reimbursed from the travel agencies, to avoid the tour guides running away with the money. They had to pay RMB 30 extra per head to the agencies to cover the agencies’ loss. Whatever left, from getting cuts of the tourists’ purchases, they can then split with the drivers and keep in their own pockets.
So they had to hustle to get the tourists to buy, because they did not receive any wage. To further complicate the issue, the Aba Prefecture mandates that all tour groups to Jiuzhaigou follow the same itinerary, staying at three different towns and visiting various shops, in a bid to boost local commerce.
The alternative? One can travel independently, pay more than twice the package price and suffer the difficulty of securing reliable transportation.
Many tourists complained about the mandatory shop visits and bouncing among towns. Mr. He told me that during a provincial-level meeting on reforming Sichuan tourism, the Aba Prefecture Governor banged the desk when he spoke – the livelihood of his people depends on the forced shopping activities; tourism accounts for 40% of the total GDP of the Prefecture which had been a poverty region before the discovery of Jiuzhaigou.
Nothing has been changed since.
“Can’t you segment the market and charge a higher price to those who want to spend more time in the park?” I asked, following my MBA instinct.
Mr. He shook his head. “It wouldn’t work in China. If you charge more, who would come?”
I wasn’t sure if he understood the concept of segmentation. Before I got a chance to elaborate, he added, “The Chinese travelers are not like those from overseas. The foreigner travelers want to be with nature. We Chinese…” He struggled to choose the right words.
I gradually got his point – the number of nature-seeking Chinese travelers who’s not counting pennies is too low to justify a segmentation. I remembered the point-shoot-and-go crowds in Jiuzhaigo. It’s all about going sharing photos with the Joneses.
“I know tourism in Hainan and Yunan provinces operate the same way. Otherwise we tour guides can’t make a living.” He sighed, “I think the rest of the country will go the same way soon.”
“This business is tough.” The driver chimed in. Now we had no more shopping to do, they were getting increasingly candid. “Sometimes too many tourists in a group are too cheap to buy anything, then we end up losing money on the trip. Some drivers will get pissed off, and pretend that the bus has some safety problem and drive off without the passengers.” He chuckled. “We are not like you educated people. Making a living is tough.”
“Why don’t you guys complain to the tourism bureau?” I asked.
“What’s the use?” Mr. He stared straight ahead. “In fact on June first, the Chengdu tour guides went on strike.”
The driver cut in excitedly, “In the months of April and May, none of the Guangdong or Fujian tour agencies could get any packages to Jiuzhaigou. You know why? Many of the bus drivers went on strike too.”
Mr. He continued in his calm tone. “What’s the use of that? The government intervened. Nothing has changed since.”
The driver laughed. He lit a cigarette and drove on. We fell silent. It started raining again outside.
“How long have you been doing this?” I wanted to ask, why can’t you leave this shitty business behind?
“In Chengdu, only one year. Before that, I worked five years in Chongqing on the Three Gorges route after graduating from the tourism school. I was actually a migrant worker.” He laughed slightly. “They dammed the Three Gorges and few people visit there anymore. We are just among the millions displaced. I visited Beijing and thought of doing tourism there since 2008 is coming. But my mandarin is not good enough, and the business there is very different. So I’m here, away from my wife and my baby in Chongqing.”
“This business,” he added, “is only for the young. Too demanding. Too little money.”
“What can you do after your body can’t keep up anymore?” I meant to ask, why can’t you choose something else?
“Maybe open up a small shop. A small restaurant. Or an office job in a travel agency.” The bus bounced up and down on the road still in construction. “With our skills, what can we do?”
I looked away from him. Outside the Min River roared angrily as our bus raced along the river. He looked no older than 27. What a difference from the Beijing discussions of getting-rich-quick. What a difference from the San Fran discussions of self-fulfillment.
The bus pulled to a stop behind a long line of trucks and tour buses packed bumper to bumper. There appeared to be an accident ahead. A group of kids had gathered under the leaky roof of a makeshift convenience store at the corner where the road turned.
Mr. He pointed to them. “At least the Prefecture is benefiting economically from all this tourism. Those kids wouldn’t be able to go to school without Jiuzhaigou.” I looked at the kids and their faces and clothes dirty from mud. They were darting between the buses and screaming with pleasure.
The traffic started moving slowly. As we curved around the corner, a kid stopped running, stood up straight and gave us a little-red-guard’s salute.
“It’s a custom here for the kids to salute and thank the tourists.” Mr. He explained as I studied at the kid’s serious expression and his red scarf.
At least some are benefiting.