By Marc Crothall

When Scotland’s Tourism Strategy, Outlook 2030 was published in 2020, our collective industry vision was clear.

To become the world leader in 21st century tourism. A bold vision, but a vision should always be inspiring enough to engage the strength of collective ambition and energy needed to believe in it, get behind it and deliver it.

Believe in it we do, still. The reality of delivering that vision is however, extraordinarily challenging, despite the resilience and determination of our sector to do so.

When you envision what a world leader in 21st century tourism might look like, you’re probably thinking digital connectivity, sustainable practices, care for communities, smart infrastructure, authentic and personalised experiences, accessibility, affordability, innovative attractions and outstanding food and drink experiences.

The potential for Scotland to realise this ambition should not to be under-estimated, however the gravity of the challenges which prevent us from delivering our vision must be understood and solutions delivered to halt the erosion of Scotland’s tourism product.

The struggle that tourism businesses faced during the pandemic and, as we moved into a cost-of-living crisis are well documented.

What is not understood, is the picture of how these businesses are operating today and the stark threat to Scotland’s current and future reputation as an affordable, quality focused destination.

In the most recent survey conducted by the Scottish Tourism Alliance, it emerged that although our tourism and hospitality sector is showing signs of recovery in relation to key overseas markets, rising cost pressures and a significant drop in domestic visitors mean that businesses are struggling to make a profit and invest in their product and teams. In most cases, they’re experiencing year-on-year decline of 10% or more.

Unsurprisingly, levels of business confidence in many parts of the sector remains low, and with booking decisions now taken within very much shorter lead times, it’s difficult for businesses to look at anything other than an uncertain forecast for the year ahead.

Cutbacks in this scenario are an inevitability which in turn stagnate growth for the sector and harm the perception of our tourism product.

Businesses are managing, or in many cases not, crippling costs against a backdrop of curtailed consumer spending. Rises in national insurance and minimum wage, energy bills, inflation, the cost of regulation, loan repayments taken out during the pandemic and rising costs of food, drink and materials are pushing many tourism businesses beyond the margins.

Those financial constraints also affect the quality of service businesses can provide; many are strained to the point where they’re considering giving up, or indeed, already have. You can’t fail to see the number of businesses coming on to the property market every week.

The recent Budget announcement that the Scottish Government will not mirror the business rates relief afforded to our colleagues in England has been met with grave concern. This could have given upwards of 10,000 businesses a period of breathing space to cope with the increased labour and operating costs and start operating more profitably, with the potential to invest.

This disparity will almost certainly deliver the death knell for some, especially in the hospitality sector, which have been teetering on the precipice for some time.

The announcement of a new income tax band brings more challenge to the sector’s ability to recruit senior and highly experienced candidates from elsewhere in the UK and retain our emerging leadership talent. In an already tough recruitment and retention landscape, how can Scotland’s tourism industry compete with the rest of the UK and overseas destinations as being an ‘employer of choice’ or a be ‘the best place to live, work, invest and do business’?

The UK Government's changes to the Skilled Worker Visa requirements also poses a serious setback for our industry, as we struggle to attract and retain talented individuals, limiting the ability of our businesses to provide a high-quality service.

The decline of business support measures will see many thousands of tourism and hospitality businesses facing acute financial challenges in the next year, tipping many into crisis.

Our position as a globally competitive tourist destination, never mind a leader in 21st century tourism is being curtailed and compromised. Scotland is already perceived by many as an expensive destination to visit ; our reputation for providing quality, choice and authenticity will be at risk of decline without the right conditions for success being put in place.

There has never been a greater need for international marketing of Scotland as a destination, yet VisitScotland’s budgets have now been cut to levels we haven’t seen before, potentially restricting our ability to create and drive the demand from overseas we very much need, given the risk of decline in our domestic market.

To maintain our competitiveness, Scotland needs forward-thinking economic strategies. We have one for tourism in - Scotland Outlook 2030, but it needs to be backed by the right policy and investment decisions being made by government to support its delivery.

Halting the risk of the decline of one of Scotland's most important economic drivers necessitates immediate action. Like other sectors, tourism deserves the full support and commitment from the Scottish Government to secure and expand its position as one of the country's top export earners.

Scotland remains a popular destination on travellers’ wish lists and it can and should be viewed as a force for good for our businesses, people, communities and ultimately, Scotland’s purse.

We are fortunate that we have many outstanding leaders in our industry who remain ambitious, determined and fully committed to our vision, with strong ambition for success. Both the UK and Scottish governments must commit to focusing time and investment in supporting the sector in a meaningful way, to address short term cost pressures, enhance business confidence and set our tourism industry back on the right path to becoming a global destination of choice.

If we are to continue to position our country as ‘the best place to live, work, invest and do business’ and successfully market our unique natural, historic and cultural assets, then 2024 must be the year the year of change, where tourism occupies a much higher place on government agendas.

Marc Crothall as the chief executive of the Scottish Tourism Alliance