Why Holiday Prices Are Higher During School Holidays?

I’m now trying to reflect on Kate’s Post I’ve read the other day from a hoteliers’ point of view.

School holidays can be a nightmare to manage. In families, where both parents work, one of them HAS to take days off, unless you have other baby sitting solutions arranged. So now that you’ve got the kids for a whole week, realise that almost all your regular soft plays and drop in classes are closed for half term. (Why?!)

I completely understand and now I’m even in the same shoes as Kate and other fellow parents: booking a holiday in half term or in summer can get very expensive. Not only that, but it’s hard to find decent family friendly places, which are not rammed or booked out.

I realise, that the doubled or even tripled rates seem like that the whole travel industry tries to take advantage of school holidays. However, you can’t enforce “fairer” prices by calling for government action. It would be an economical disaster for the whole industry.

I’ve worked for a number of hotels throughout my career (before having children). Started as a receptionist, then switched to sales and operation. Lately, responsible for the revenue. My role was basically to set the rates according to the budget. I’ve dealt with the contracts for travel agencies and online booking sites and set the daily, seasonal and packaged rates for the rooms.

Most hotels and travel providers work with seasonal rates. They depend depending on the actual seasons, and some other highlighted periods of the year, like winter months in the Alps, the Chelsea Flower Show in London, the Carnival in Rio, or the Australian Open in Melbourne. Another factor in hotel pricing is the top ranking sending countries or nations. People tend to travel during long weekends, national holidays or indeed, school holidays.

Now, like every company, travel businesses too, depend on the demand and it will have a direct effect on the price. When not so much people want to travel, prices will drop. When not enough rooms are booked, price will drop. Other times, when the demand is high, the prices will rise too. The fluctuating prices allow the hotel or airline to meet with their budgeted revenue requirements and produce profit. When you urgently need a shirt – you go and buy it on full price. When not, then you wait until it’s (at a predictable time, like after Christmas) is on sale. 

Hotels can never charge you more for a room as their rack rate for that particular room. But then you buy often buy your holiday in a package (directly from the hotel or booking with a travel agency) so you never actually see the price breakdown. When it seams, that the price has been doubled or more, that is actually correct. It did so. Low season means prices barely make a break even, and high season means selling on rack rates. The difference can be even 4x or 5x of the low season’s rate.

A hotel operating successfully can pay better wages, can hire more and better trained staff, provide valuable training for their staff. Hotels also employ mostly local people, so they play a key role in creating jobs for the local communities. If you want to see really bad examples of a holiday destination managed badly and local communities suffering because of it, take a good look at the Isle Of Wight. It used to be a famous holiday island. Now almost all the hotels are for sale, because they went or near bankrupt. A fantastically beautiful island with lots of potential. Heartbreaking. Why? Because in summertime everyone flies to classic holiday destinations. So the island misses out on that crowd. Prices are also high in summer, because they naturally try to make their whole year’s profit. Because no one goes there in autumn or winter. Some people might do, like we did it as a couple, and enjoyed the walks on the beautiful, empty beaches. But now we can’t, because we can only travel during the school holiday, and that’s for the years to come!

As I said I’m equally effected by the soaring holiday rates at half term and in August. However, having some time spent on the other side as a hotelier, I can tell you: the problem doesn’t lie with the travel industry, as I tried to explain this above.

I can see the solution in schools given more flexibility to allow family holidays during term time, provided that there is no general issue with a children’s attendance. Brighton and Hove is leading the way: http://www.bbc.co.uk/news/uk-england-sussex-36806773 but I think there’s more can be done!