Pata ends 2009 with a surplus
Pacific Asia Travel Association should close 2009 with a US$80,000 surplus after suffering a loss of over US$30,000 in the previous fiscal year.
The travel trade association closes its books, 31 December, and reports to its members results at the annual general meeting in April. The 2010 AGM will be held in Kuching, East Malaysia.
A reliable source in the association confirmed membership revenue, this year, remained unchanged at around US$2 million. Earnings from events such as the PTM were down on previous years, but acceptable considering the economic climate.
However, the return to a financial surplus for the non-profit association was mainly attributed to cost savings in salaries and the closing of two regional offices; one in Macau and the other in Dubai.
Pata has tightened the belt this year with the new CEO, Greg Duffell capping entertainment and travel expenses while setting a low ceiling on spending approval for department heads.
2008’s balance sheet reflected some substantial pay-outs to top management executives in severance, exit bonuses and compensation (written into contracts). The association also absorbed a loss when a US agency that handled Pata’s international payments declared bankruptcy forcing the association to pay a round of invoices twice.
Other financial issues includied discrepancies in foreign exchange calculations on salaries that to be settled during the 2008 fiscal year.
Despite an improved fiscal outlook, the association is far from the so called “rebirth” as outlined in Mr Duffell’s latest business plan.
Pata has slightly less than 700 paying members. It still needs to collect US$200,000 from members who are currently in default. Two governments have failed to pay dues this year.
Despite all the efforts of the new management, membership retention is a low 70 to 75%. This means the association loses nearly 200 members annually. It hopes to increase the retention rate to a more manageable level of around 85% by demonstrating more clearly membership benefits.
The executive committee, yesterday, agreed in principle to pay a commission to chapter members who recruit international members. The lowest membership fee is US$1,000, while a government pays between US$23,000 to US$39,000 a year. The commission will most likely range from 10 to 15%.
Committee members said the commission would be offered to anyone in the travel business who could recruit membership. Ironically, the committee voted not to hire a business development manager, at head office level, to supervise membership sales.
Three events are being billed as life-savers to generate revenue over the next two years.
The annual Pata Travel Mart will be beefed up, while retaining the same format, rotating the venue on the basis of city bids and with a strict appointment structure. However, it will attempt to be more representative of all its members and provide them with an “exclusive” platform to do business.
In April 2011, the association will celebrate its 60th anniversary that will also mark the re-introduction of its popular annual conference.
The conference was dropped in 2007, reportedly for financial reasons. Privately, Pata executives noted that Taiwan had won the bid for that year and China, a rising star in Pata, filed an unofficial objection. The easy way out was to ditch the conference for what the management called a CEO Challenge, hosted in Bangkok, that proved to be a monumental flop.
Pata cannot afford to upset China as it attempts to build membership. It has also proved to be one of its main supporters in hosting events. The 2011 anniversary event will present the same ticklish issue for Pata as it prepares to make a final decision on the venue next February.
Hawaii is one choice, but it is apparently concerned about hosting costs. In the past, Pata’s management demanded limousines for top officials and the chairperson and expensive suites, all complimentary.
It is understood, Hawaii might be interested if Pata agrees to a shave some of its lavish requirements. Cities interested in hosting the anniversary event have until February to make a bid.
Finally, Pata has revived its Adventure Travel Mart to be held next February in Nepal. The target is 50 buyers and 50 adventure-related seller companies. So far, it has under-performed in registrations and could rack up a loss of between US$2,000 to US$3,000.
But Pata says this is a long-term commitment and an operational loss needs to be absorbed until the show is established.
