9502.0.55.001 - Framework for Australian Tourism Statistics, 1999

ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 02/12/1999

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Contents >> Chapter 3. Typical measures for tourism >> Typical measures for PRODUCT

Introduction

62. This Topic elaborates on measures for the PRODUCT element of the event and provides definitions and classifications where relevant.

PRODUCT specific data

63. Most of the measures relating to PRODUCTS will be product specific, or possibly location specific, and standard classifications are not appropriate. Requirements will vary depending on the aim and focus of the study.

64. These measures would include:

Type of products -- required description of the goods/services.

Quality -- measures of the quality or standard of the goods/services.

Price range -- possibly an alternative measurement of quality.

Means of distribution -- the channels through which the goods/services reach the consumer.

Places visited -- specific places of tourist interest in the destination region.

Other product specific measures -- e.g. occupancy rates in accommodation establishments.

65. As data on the supply and occupancy of commercial accommodation are one of the most important measures of particular interest, this is dealt with in some detail.

66. Data on the availability of accommodation units (e.g. rooms, beds, holiday flats, caravan park sites, etc.) should generally comprise only those units which are available to paying guests each night. It should exclude, for example, units used by managers or staff, or units unavailable due to repairs or any other reason.

67. Data on the occupancy of accommodation units should comprise the number of units which are occupied by paying guests each night.

68. Occupancy rates for a period are calculated by summing the number of units occupied each night during the period, and expressing this as a percentage of the sum of the number of units available each night during the period.

69. For measurement of supply and occupancy, the unit of measurement varies depending on the type of accommodation involved. For example:

In Hotels, Motels and similar establishments where the accommodation is sold on a room basis, the appropriate units are rooms and bed spaces (where a double bed = 2 spaces);

In establishments such as self-catering or holiday apartments, where the accommodation is sold on the basis of the whole apartment, the unit of measurement is apartments;

In hostels or other dormitory-style accommodation, where accommodation is sold on a bed basis, the appropriate measurement unit is bed spaces;

In Caravan parks and camping grounds, the appropriate unit is sites. Sites should be split between 'Powered' and 'Unpowered' sites, depending on whether the sites have electrical connections or not.

70. In the case of Caravan parks the question arises of how sites which are permanently reserved, but not always occupied, should be treated in the statistics. (The actual caravan on the site may be owned by the park owner or by the visitor.) Theoretically their treatment would differ depending on what the statistics are required to identify. In some cases it would be appropriate to exclude such sites from both the supply and the occupancy statistics as once they are reserved they are not publicly available for paying visitors. In this case they would be treated as though they are second homes. This, however, understates the demand for visitor accommodation as the occupiers are usually genuine visitors rather than residents. Alternatively, it may be appropriate to include them in both the supply and occupancy statistics to reflect the fact that they are taken up by paying guests, even if those guests are not physically occupying the site for much of the time. A middle approach would be to abide by the general rules outlined above, viz. include the site in the supply statistics for each night, and only include it in the occupancy statistics for those nights when it is actually being occupied. This gives an accurate picture of the demand for accommodation by visitors. While this might seem like the most appropriate treatment for some statistical uses, it is recognised that different uses require different treatments, and that there is no 'best' treatment. An additional consideration is the practical issue of what data can actually be collected. The experience of the ABS with the Survey of Tourist Accommodation (STA) is that many caravan park operators do not know when such sites are actually physically occupied. Consequently, in the STA results, such sites are treated as being 100% occupied. While this overstates the number of visitor nights in a destination area, it accurately reflects the extent of visitor accommodation available. (The STA results, however, do allow these sites to be excluded from the supply and demand side and occupancy rates recalculated accordingly.)

Expenditure

71. Statistics on expenditure by visitors constitute one of the most important, and most complex, measures of tourism required by researchers and analysts. They are used for a wide variety of purposes ranging from assessing the value of tourism expenditure in a particular destination or industry sector, to assessing the impact of tourism on the national economy. The different uses of tourism expenditure statistics require different treatments of different types of expenditure. For some purposes, certain types of expenditures are required to be included in the statistics, while for other purposes these types of expenditure should not be included. For example the data needs for the Balance of Payments may be quite different to the data needs of an industry sector in a local area.

72. The UN/WTO definition of tourism expenditure is closely linked to its definition of tourism consumption. Tourism consumption is defined as 'the value of goods and services used by or for tourism units (visitors)'. Tourism expenditure is thus defined as: "the total consumption expenditure made by a visitor or on behalf of a visitor for and during his/her trip and stay at destination".

73. The concept of tourism expenditure encompasses a wide variety of items, ranging from the purchase of consumer goods and services inherent in travel and stays to the purchase of small durable goods for personal use, souvenirs and gifts for family and friends.

74. The definition of tourism expenditure allows that:

the consumption of the good/service may not necessarily be by the visitor him/herself. While in most cases the visitor is the consumer, in some cases a friend or relative may be the consumer, as in the case of a gift or souvenir purchased by the visitor on the trip and given to someone else;

the expenditure may not necessarily be undertaken by the visitor him/herself. In the case of a group, such as a family, expenditure may be undertaken by one person, such as a parent, on behalf of another, such as a dependent child. The person undertaking the expenditure may or may not be accompanying the visitor, as in the case of a business visitor being funded by an employer; and

the expenditure may be incurred before, during or after the actual trip. Expenditure incurred before or after the trip which relates to commodities received on the trip should be included, e.g. pre- or post-trip payment for accommodation. Also, in some cases, commodities directly relating to the trip, but received before or after the trip should be included, e.g. photographic films or special holiday clothing.

75. While it would be desirable to be able to devise a set of rules for inclusions/exclusions of the many types and categories of expenditure, this is not possible due to the different requirements of tourism expenditure statistics. However, guidelines have been produced by the WTO to provide standards to facilitate international comparability of data. These guidelines, listing categories of expenditure which should be included or excluded from expenditure statistics, are shown in the following chart.

CATEGORIES TO BE INCLUDED/EXCLUDED IN TOURISM EXPENDITURE STATISTICS
	Expenditure category	Domestic tourism	International tourism

1. Pre-trip expenditure:
1.1	Important acquisitions such as cars, caravans, boats, second homes, even though they may be used in the future for tourist travel	EXCLUDE	EXCLUDE
1.2	Small durable items or consumables which are purchased or hired for this trip, (even if mostly used after this trip, e.g. luggage, leisure/recreation goods)	INCLUDE	EXCLUDE
1.3	Services which will be used entirely on this trip, e.g. transport, package tours, accommodation travel insurance	INCLUDE	INCLUDE (a)
1.4	Services obtained prior to the trip which are directly related to the trip, e.g. motor vehicle servicing, home/pet care	INCLUDE	EXCLUDE
2. On-trip expenditure
2.1	Purchases for commercial purposes, such as for resale, investment or other business use, made by any category of visitor and purchases made on behalf of their employers by visitors on business trips	EXCLUDE	EXCLUDE
2.2	Cash given to relatives or friends which does not represent payment for tourism goods or services, as well as donations made to institutions	EXCLUDE	EXCLUDE
2.3	Capital type investments or purchases engaged in by visitors, such as land, housing, real estate, and other important acquisitions, such as cars, caravans, boats, second homes, even though they may be used in the future for tourist travel purposes	EXCLUDE	EXCLUDE
2.4	Expenditure on everyday purchases made on a trip, outside the usual environment, whose purpose is to avail of lower prices, higher quality or wider choice for such goods	INCLUDE	INCLUDE
2.5	Other major expenditure items, such as major car repairs	INCLUDE	INCLUDE
2.6	Small durable items or consumables, irrespective of whether used on tourist travel or at home	INCLUDE	INCLUDE
2.7	Items, such as ornamental/decorative items, which are primarily mementoes of the trip, e.g. souvenirs, irrespective of the cost	INCLUDE	INCLUDE
2.8	Services acquired on the trip, e.g. transport and accommodation	INCLUDE	INCLUDE
2.9	Any other purchases of goods/services obtained at any destination, irrespective of cost	INCLUDE	INCLUDE (b)
3. Post-trip expenditure
3.1	Goods/services obtained after the trip which are directly related to the trip, e.g. photographic processing, repairs to motor vehicles damaged during the trip, but excluding important acquisitions and capital type investments	INCLUDE	EXCLUDE
(a) For Outbound tourism: INCLUDE only services received outside the reference country, and international transportation. For Inbound tourism: INCLUDE only services received inside the reference country and international transportation. (b) For Outbound tourism: INCLUDE. For Inbound tourism: INCLUDE only purchases in the reference country.

76. While expenditure on important acquisitions and capital type investments (items 1.1 and 2.3 in the chart) should be excluded, there are two related expenditures which should be INCLUDED, viz.

any associated running or maintenance costs incurred on the trip, e.g. fuel and repairs. Annual charges, such as rates payable on a second (or holiday) house, should be attributed, as far as possible, to each visit to the holiday house on a pro-rata basis, based on an estimate of the number of days to be spent in the holiday home throughout the year. Only out-of-pocket costs should be included. Other types of costs, such as depreciation, should not be included. If these are required for research or accounting purposes, they should be calculated separately from other sources;
expenditure on a product which is purchased during a trip specifically for use on the trip and is sold during the trip, e.g. a vehicle used for touring at the destination. The net cost should be included, i.e. the purchase cost plus running costs less the selling price.

77. The issue of whether works of art or jewellery should be treated as 'capital type investments' is a complex matter. Defining such items is difficult. When does an item become a 'work of art'? A piece of jewellery could cost any amount, and clearly while a cheap piece would not be considered a 'capital type investment', the question arises as to when a purchase does constitute such an investment. Setting a specific value, say $10,000, above which such a purchase would be considered a 'capital type investment', would be arbitrary and subject to irresolvable debate. In addition to the difficulty of defining such items, is the complexity of the reason for purchase. Such items may be purchased for personal or investment purposes or for a combination of both. Until further work is done on this issue to provide a satisfactory set of rules on how to statistically treat such purchases, the WTO has developed a rule-of-thumb recommendation. While accepting that precise assessment of the motive for purchase can often be difficult in practice, the following guidelines are recommended:

If the purchase is for or on behalf of a business (either for resale, investment or for decoration), then EXCLUDE;

If purchased solely or primarily for investment, then EXCLUDE;

If purchased solely or primarily for personal use (of visitor or someone else), then INCLUDE.

78. Expenditure should comprise the cost to the visitor of purchase of a product, i.e. it should allow for any tips, agents' fees, taxes, discounts, or other adjustments to the price.

79. Expenditure undertaken through any mode must be included, e.g. cash, credit/debit cards, travellers' or personal cheques, electronic transfer, direct billing or any other method.

80. The source of the funding of expenditure, i.e. whether the expenditure is funded from within or outside the destination area, may be an important issue for some studies. Depending on the purpose of the collection, either total expenditure or only expenditure sourced from outside the destination area may be required. For example, for an assessment of the value of tourism to a destination area, only that expenditure which is sourced from outside the area might be of interest, while for measurement of total tourism economic activity all expenditure, irrespective of source, might be required.

81. Expenditure sourced from within the destination area would include, for example:

expenditure incurred by a host as a result of a visit by a friend or relative;

expenditure by the visitor sourced from a bank account or other investment in the destination area; and

expenditure by a business visitor which is funded by a branch of his/her business in the destination area.

82. As the chart showing inclusions/exclusions in tourism expenditure statistics indicated, there are different requirements for data on expenditure by domestic and by international visitors. Because of this, data on expenditure by domestic and by international visitors are discussed separately below.

Expenditure by domestic visitors

83. Within the context of the definition of tourism expenditure, the UN/WTO definition of 'Domestic tourism expenditure' is: "Expenditure incurred as a direct result of resident visitors travelling within their country of residence".

84. The matrix below summarises the broad categories of domestic tourism expenditure according to where the expenditure is incurred and to whether the expenditure is funded from outside or inside the destination area.

EXPENDITURE INCURRED OUTSIDE DESTINATION

SOURCE OF FUNDS		Products received outside destination	Products received at destination	At destination	Total
		(1)	(2)	(3)	(4)


Outside destination	(1)	(1.1)	(1.2)	(1.3)	(1.4)
At destination	(2)	(2.1)	(2.2)	(2.3)	(2.4)
Total	(3)	(3.1)	(3.2)	(3.3)	(3.4)

85. For any particular study, the cells of interest will depend on the purposes of the study. Whether the perspective is from the destination area level or the national level will influence what cells should be included in the statistics.

86. The standards adopted by the UN/WTO for international comparability of data, require that all, and only, Row 1 expenditure cells be included, i.e. all and only expenditure funded from outside the destination area. For this purpose, no expenditure sourced at the destination area, i.e. Row 2, should be included. This approach recognises the difficulty of collecting such data which, in practice, is usually not included in responses in tourism expenditure surveys.

Expenditure by international visitors

87. International visitor expenditure covers expenditure by both:

inbound visitors to Australia, i.e. International inbound tourism receipts; and

residents of Australia travelling abroad, i.e. International outbound tourism expenditure.

International inbound tourism receipts

88. Within the context of the definition of tourism expenditure given earlier, the UN/WTO describes 'International inbound tourism receipts' as:

"Expenditure of international inbound visitors, including their payments to national carriers for international transport. This should also include any other prepayments made for goods and services received in the destination country."

89. The matrix below summarises the broad categories of international inbound tourism expenditure according to where the expenditure is incurred and to whether the expenditure is funded from outside or inside the reference destination country.

EXPENDITURE INCURRED IN OTHER COUNTRIES


			Travel to/from Australia		Other expenditure
SOURCE OF FUNDS		In Australia	On carriers registered in Australia	On foreign carriers	Products obtained in Australia	Products obtained in other countries	Total
		(1)	(2)	(3)	(4)	(5)	(6)


Other countries	(1)	(1.1)	(1.2)	(1.3)	(1.4)	(1.5)	(1.6)
Australia	(2)	(2.1)	(2.2)	(2.3)	(2.4)	(2.5)	(2.6)
Total	(3)	(3.1)	(3.2)	(3.3)	(3.4)	(3.5)	(3.6)

90. As in the case of Domestic visitor expenditure, the types of expenditure which should be included in International inbound tourism receipts data depend on what the statistics are required for.

91. Expenditure by international inbound visitors represents an increase in demand on the Australian economy that would not have otherwise occurred. To some extent this simplifies the issues involved in deciding what type of expenditure should be included, compared with domestic tourism expenditure. For example, for Australian purposes, it is not likely that any collection will be required to collect expenditure on products obtained in other countries, (including on foreign carriers), e.g. clothes purchased in advance to wear on the trip, or purchases made in transit to/from Australia. So, expenditure in columns 3 and 5 in the above matrix are unlikely to be required, and only the cells in columns 1, 2 and 4 will be included.

92. For most purposes, international inbound visitor receipts data should only include payments which are sourced in other countries on products obtained in Australia, i.e. cells 1.1, 1.2 and 1.4. These payments may be made in Australia or in any other country.

93. However, for some studies payments by or on behalf of the visitor, which are sourced in this country - for example, from a visitor's bank account in this country or from a host - might be required (i.e. cells 2.1, 2.2 and 2.3). In such cases, these should be collected, but identified separately from expenditure sourced in other countries.

94. For purposes of international standardisation and comparability of data, the UN/WTO recommendations require that only expenditure, which is sourced in another country, on products obtained in the reference country should be included (i.e. cells 1.1, 1.2 and 1.4). For other purposes, of course, data in other cells may be required.

95. For all purposes, data on expenditure, particularly pre-trip expenditure, may be collected in the currency of the visitor's country of residence, which should be converted into Australian dollars using the exchange rate in effect at the time of the survey.

International outbound tourism expenditure

96. Within the context of the definition of tourism expenditure given earlier, the UN/WTO describes 'International outbound tourism expenditure' as:

"Expenditure of international outbound visitors to other countries, including their payments to foreign carriers for international transport. This should also include any other prepayments made for goods and services received in any foreign country."

97. The matrix below summarises the broad categories of international outbound tourism expenditure according to where the expenditure is incurred and to whether the expenditure is funded from outside or inside Australia.

EXPENDITURE INCURRED IN OTHER COUNTRIES

			Travel to/from Australia		Other expenditure
		In Australia	On carriers registered in Australia	On foreign carriers	Products obtained in Australia	Products obtained in other countries	Total
SOURCE OF FUNDS		(1)	(2)	(3)	(4)	(5)	(6)


Australia	(1)	(1.1)	(1.2)	(1.3)	(1.4)	(1.5)	(1.6)
Other countries	(2)	(2.1)	(2.2)	(2.3)	(2.4)	(2.5)	(2.6)
Total	(3)	(3.1)	(3.2)	(3.3)	(3.4)	(3.5)	(3.6)

98. Again, as noted in the case of domestic and international inbound tourism, the types of expenditure which should be included in international outbound tourism expenditure data depend on the requirements of a particular study.

99. Expenditure by international outbound visitors on products obtained in another country (i.e. cells 1.1, 1.3 and 1.5) represents a loss to the Australian economy. While this type of expenditure is usually what is of most interest, for some purposes expenditure by outbound visitors on visit-related products obtained in Australia, before or after the visit, may also be of interest (i.e. cells 1.2 and 1.4). For example, purchase in Australia of holiday clothing prior to taking an overseas trip, or payment to Qantas or Ansett for transportation from and to Australia, would be considered to be economic activity resulting from tourism, in an assessment of the impact of tourism on the economy.

100. Payments by outbound visitors which are sourced from a destination country (e.g. from a traveller's bank account in that country), are not usually required for most purposes (i.e. row 2). For studies which do require such data to be collected, the expenditure should be identified separately from expenditure sourced in Australia.

101. For purposes of international standardisation and comparability of data, the UN/WTO recommendations require that only expenditure, which is sourced in the reference country, on products obtained in other countries, should be included (i.e. cells 1.1, 1.3 and 1.5). However, for other purposes, data in other cells may be required.