In the post-pandemic era, a shift away from relying excessively on inbound demand will be key to success in building a new business model, according to Yoshiharu Hoshino, head of tourism operator Hoshino Resorts Inc.
“It’s important to build tourism that is resilient against crises,” Hoshino said in a recent interview in Tokyo.
The company, based in the highland resort town of Karuizawa in Nagano Prefecture, is seeking to bolster earnings by boosting its services for domestic travel, at a time when demand for such trips has been stable thanks to government stimulus measures.
Hoshino also spoke about the importance of doing business in overseas markets, saying, “expansion into North America is a must.”
While predicting that inbound demand would continue playing a core role in the tourism industry after the pandemic, Hoshino stressed the need for “risk diversification.”
“In my 30-year experience of operating tourism facilities, crises have occurred every five to 10 years,” he said, citing the collapse of the nation’s bubble economy in the early 1990s, a series of corporate bankruptcies following a financial crisis in Japan in the late 1990s, the global financial crisis triggered by the collapse of U.S. investment bank Lehman Brothers in 2008, the Great East Japan Earthquake and tsunami in March 2011 and the ongoing COVID-19 pandemic.
Hoshino said his company needed to focus on “microtourism,” such as travel by people to destinations only one to two hours away from their homes.
“We must acquire the ability to operate hotels overseas,” he said, with medium- to long-term shrinking of the country’s population and domestic travel demand in mind.
Hoshino Resorts is set to expand into mainland China next spring.
“If we cannot operate (hotels) in North America, we cannot be recognized as being able to do the business globally,” he said, suggesting that the resort operator is also seeking to enter the continental U.S. market after launching a facility in Hawaii early this year.
In North America, Hoshino Resorts hopes to open hot spring resorts, — an area in which it has strength — to reach out to U.S. consumers.
“We are prepared to go when we can find” a good location, he said, noting that there are some 1,200 locations with natural hot springs in the United States.
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