Alpha Tours to spend $1.4m in Saudi venture

DUBAI-BASED Alpha Tours has entered into a joint venture with the Saudi Travel and Tourism Bureau (STTB) in Saudi Arabia to manage 28 offices jointly. The venture is part of a Dh10 million ($2.72 million)  investment.

“Saudi has always been the biggest market from this region. The focus has shifted to bringing in more tourists from selective markets. STTB has been a well-known name in the business for more than 30 years. What they need now is the right push, the right technology and the right management. And working together with them, Alpha Tours will provide just that. We will share our expertise, sell our products and revive the market,” says Ghassan Aridi, CEO, Alpha Tours.
On market expectations from the Saudi market, Aridi feels the need to first increase the business within the STTB for both inbound and outbound. “We expect an increase of at least 20 per cent in the first year alone and also, this will increase business for Alpha Tours from the GCC market by 25 per cent.”
Alpha Tours will make a total investment of Dh10 million over the next few months. Fifty per cent of this is to develop the STTB business in Saudi and Bahrain, with the rest being spent in the UAE.
Though Saudi Arabia is known to have strict visa and travel formalities, Aridi points out that the Saudi Supreme Commission for Tourism has eased restrictions in recent months, and is working towards a solution to bring in more tourists and is now taking that forward with DMCs.
“They will initially start with five or six popular destinations like Japan and Germany for their inbound traffic and will increase it step-by-step. Saudi is a market that they cannot open widely for many reasons,” Aridi says. “They want to target those who are truly interested in the rich heritage and history. And the country has a big product and many attractions both historically and cultural.”
Alpha Tours will also focus on increasing outbound traffic figures from Saudi Arabia. Nationals like to travel within the region to Lebanon and Egypt as well as further afield to to Malaysia, Australia and in Europe, the UK and Belgium. The company hopes to add new products and destinations like South Africa.
Along with these destinations, Alpha Tours is planning on expanding shortly to Brazil, for both inbound and outbound traffic, says Aridi.
“With Emirates likely to launch flights to Brazil soon, we are very excited about this market. Our office is ready in San Paulo. In terms of other offices, we have plans to open a new office in Spain as well and we work very closely with the UK market, which is our second largest market for inbound to Dubai. Alpha Tours are agents for Virgin Holidays and we work with many good tour operators in the UK. In fact, being a huge market for both inbound and outbound traffic, we already have plans to set up offices there in the near future.”
Last year was a very successful year for the agency, he says, with the signing of a GSA agreement with Costa Cruises for the region as well as setting set up of Alpha Holidays. Plans for 2007 include such major initiatives as a web portal to provide online solutions to their customers.
“We have invested a lot in this new project, it figures in the $10million we have recently invested. We have invested in technology and new systems, so consumers can choose their vacations and tailor them to their tastes. Everything is online – the facilities available at the hotel, the rooms, and so on. This is the future of travel agencies,” he says.
Aridi points to the disappearance of travel agencies in countries such as the US and the UK. “It’s only the big wholesalers and the tour operators that exist now. However this trend has not yet caught up in this region. People booking over the internet are less than five per cent today, but we see this increasing to 15 per cent over the next four or five years,” adds Aridi.
Also available online will be a range of packages, designed for different seasons, occasions and people. The agency runs packages starting from for three days in Oman to one week in Brazil or the US. “It’s a general policy to have something for everyone.”
All their products will be presented in a new brochure that will be launched in March at ITB 2007. It will also include packages for the Saudi market, as well as the UAE, where as of today, the company claims to be the number one inbound agency.
“We are leading the inbound operations, always neck-to-neck with Arabian Adventures, who we believe is our only competitor. We are very proud that we are private emirate company to have achieved this position. For the outbound, we will stand in the same position in another two years,” he says.
Alpha tours has seen an increase of 45 per cent in tourist figures over the last five years and this year has seen an increase of 30 per cent and even though Dubai still has limited availability of rooms, the company expects to see a huge increase in the next couple of years.