Croatian Guests Kept Terme Tuhelj’s Head Above Water in 2020

Lauren Simmonds

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As Poslovni Dnevnik/Marija Crnjak writes, just like everything related to tourism, doing business in 2020 was extremely challenging for Terme Tuhelj, which in the last few years has invested a lot in raising its overall quality and creating added value for the entire destination of Hrvatsko Zagorje.

Despite the less than favourable circumstances, they managed to generate slightly more than 60 percent of their revenue when compared to the record year of 2019, which was revealed by Terme Tuhelj’s director.

What are Terme Tuhelj’s plans for this year?

Due to the very uncertain situation, planning for 2021 remains a great challenge for Terme Tuhelj. But since the hotels, swimming pools and other services we offer are mostly in operation all the time, we’ve already gained some experience of how the market reacts in this type of situation.

Due to all of the above and based on many years of experience, historic data and past trends on the one hand and the events of last year’s crisis year and good business in the first months of this year on the other, we’ve estimated and plan approximately 15 percent lower income realisation when compared to revenues in 2019.

Have you maintained financial stability?

With the great help of our parent company last year, due to the positive results in the first three months of 2021 and the use of support and subsidies by the state, we managed to preserve our financial stability and if there’s no total lockdown or some drastic measures, the company isn’t endangered.

What was the composition of the guests who came to Terme Tuhelj last year, and can the spas survive solely on the custom of Croatian guests?

The structure of guests in 2020 didn’t reflect the usual situation in a normal business year. Namely, after the reopening after the spring 2020 lockdown, the epidemiological situation in our main emitting markets changed greatly during the year. Despite reservations and inquiries from certain markets, guests were forced to cancel or shorten their trips due to the measures of their own countries.

In the autumn, in the end, everything resulted in a total lockdown and the arrival of foreign guests was prevented. Therefore, we recorded a decline in the number of overnight stays from foreign markets by as much as 66 percent, while the decline seen from the Croatian market wasn’t so great thanks to individual guests who partly replaced a holiday abroad by visiting spas precisely because of the closed borders.

At the end of the year, Croatian overnight stays accounted for slightly less than 66 percent of the total structure of all overnight stays realised, while in the year before the coronavirus pandemic, they amounted to only 47 percent.

What kind of results did the hotel have?

Hotel Well realised slightly less than 72,000 overnight stays, which is a decrease of 45 percent when compared to the record year of 2019. When we look at business in 2020 from the perspective of sales channels, we’re able to see that the number of overnight stays of MICE activities decreased significantly.

In this segment, the number of overnight stays decreased by as much as 82 percent when compared to 2019, which is completely understandable since the measures that didn’t allow the gathering of a larger number of people in one place were in force all that time. There was also a big drop in organised foreign groups staying here, and in 2020 we had a 89 percent drop in overnight stays in that regard. Namely, only 2380 overnight stays were realised, while in 2019 there were 22,353 overnight stays achieved.

Overall, the drop in overnight stays from organised groups is high, standing at 83 percent. On the positive side, the decline for individual guests is still much smaller and amounted to 22 percent, which shows that we managed to mitigate the consequences of the coronavirus crisis with a flexible approach and quick reactions.

In which markets are you advertising now?

Due to the current difficult epidemiological situation in our main emitting markets, we haven’t yet launched advertising campaigns in foreign markets, except for a minimal presence and communication on social media. The majority of our promotion is still done here at home on the domestic market, but we believe that this will soon change and that we will slowly start with the promotion on the neighbouring Slovenian market, and before the season, in other markets of the European Union as well.

What insights from the pandemic year will you apply in 2021?

From this situation, we’ve learned that it’s necessary to closely monitor the development of the market situation, the changing demands and the requirements of guests, as well as changes in various measures and recommendations by all of the relevant institutions and the need to accept these changes as the only fact over which we have no influence.

However, we have full influence on our actions and therefore we should focus all our energy on adapting to the situation instead of commenting on it. We’re going to continue to adapt all of our sales and promotional activities to the situation and direct them to such a way of working and doing business in order to achieve the best results. This has been a well-established practice in the last crisis-dominated year and only with maximum flexibility on the side of promotional and sales activities can we maximise the results in this uncertain year of 2021 as well.

You even had crowds this winter that were written about, do you have any information if there were any infected people at your pools?

Crowds during the winter holidays are a subjective term talked about by some visitors under the influence of fear of infection or dissatisfaction with certain measures, but I’d like to note that in Terme Tuhelj we strictly adhere to all of the anti-epidemic measures and recommendations of the CNIPH and accordingly always respect the fact that there are only a certain number of visitors permitted in individual facilities, including in the swimming pools and saunas.

Due to compliance with these measures and a larger number of guests staying at the hotel, at certain times we’re forced to close the entrances to the pools, although this causes dissatisfaction among our daily visitors. However, the health of our guests and our employees will always come first and we aren’t going to deviate from that. Owing to this, we can state that we haven’t had any cases of infection recorded among any of our employees or guests.

Is it a good time to invest?

As I mentioned, in the first place business needs to be stabilised first and we need to return revenues to pre-crisis levels. It’s clear to us that the global pandemic has not only caused problems in our company, but has affected the world’s economy, and it was the tourism sector that felt the biggest drop in traffic.

Despite that, we aren’t going to give up on our development plans, which we proved last year when we successfully completed the investment in Glamping Village Terme Tuhelj in the middle of the public health crisis, but we will certainly move the deadlines for our strategic investments in the future.

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