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The recession - how is it affecting gites?


Kitty
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Glacier, in the words of a song in South Pacific, my late mother's favourite film: 'You got to have a dream, if you don't have a dream, how you gonna have a dream come true'.

When you say that you have more questions than answers, can you share some of these and some Forum members may be able to help?

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omg, where do I start?!?  I just double guess my actions and I hope that my coming here to this region will be rewarded by a stable return in rental.  I do not anticipate that it is going to be a "get rich quick" solution, but if it pays for me to stay in this wonderful country which I've grown to love then I'd be more than happy to carry on. 

As I have questions, I will post them on here, because at the moment my head is filled with how to best reduce renovation costs (cash payments? lower range products? re-using some products I have left over from our house etc).  I will cope with all the French taxes etc when it comes, I will make sure that I will not overspend. 

Thanks Cathy, I will post questions as and when they arise, at the moment, it's full steam ahead with the work! [:D]

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If you ever do find a 'get rich quick scheme' in France let me know. I have heard of most of them by now but none seem to work. I know of loads of 'get poor incredibly quick' ones if anyone's interested. I love siting in bars listening to the Brits saying "I have this idea which I bet nobody has thought of before and I reckon it will make me a fortune" yeh right [;-)].
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Glacier1 - if you are doing guided tours etc, you need to be insured for it and any vehicle you use to transport guests needs to be insured too.   Your insurance company may tell you this is not possible unless you have a taxi permit (this is what happened to me) but this is not true and you can get insurance for 'usage professionelle occasionelle'  which is not too expensive.  What is important is that any trips you take the guests on are included in the price of their stay and prebooked and that you are not paid extra like a taxi.  A subtle difference but worth knowing about!  If you want to advertise your services then be careful that you are actually allowed to do the things you propose, as tourist offices can and do check up.  There are all kind of weird and wonderful regulations and it is as well to at least be aware of them.

Quillan is right - if you find the get rich quick scheme I'll stand behind him in the queue to get the instructions.[:D]

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The enforcement of rules vary by departement and whether any existing businesses have their nose put out of joint but I know that you should actually be licensed to give tours.

Lots of B&B owners in my area (British) give battlefield tours to top up their income, there are also a couple of registered companies doing the same but using local guides on a self employed basis (another minefield).

Last year the G men mounted an operation where they stopped and checked all vehicles stopping at the monumnts and interrogated drivers and passengers, those that they were not entirely satisfied with had their vehicles impounded until they could come up with a permit, which to obtain one first had to do a formation which in turn needed proof of fiscal residence, business registration etc.

All the time that this was going on the storage charges for the vehicles were mounting in addition to the recovery charge.

Unlikely to happen unless it becomes a significant activity in an area or is affecting existing businesses.

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Thank you very much for this useful piece of advise!  I will offer tours, but not in the traditional sense (I do not want to advertise it) I want, rather, to offer it as a "happy to help you" service which is included in prices.  I do not want to show that I'm offering a service going a) to b) because then, I will enter into the zone where taxies come in.  I do not want to piss anybody off, I mearly think that a service driving people 5 or 6kms to and fro will not harm anybody, anything further away has to be arranged by me using a profesional.  This is wise I think, I do not want to tread on people's feet here and I fully intend to keep "under" the radar. 

My main goal is to give most (if not everybody) who comes to stay with me a [:)] face when they leave.  I want people to realise that this guy (ie: me) is happy to help, and willing to go the extra mile to cater for people and their demands (understanding that I can't please all the people all the time).

The key in my mind is going the extra mile.  I shall look into this insurance you speak of "usage professionelle occasionelle" which is vital in case of spot checks by the local "G" men as one of you put it! lool. 

Thanks again for your posts!  You are all very helpfull and I fully apreciate it!

David

[quote user="Cerise"]

Glacier1 - if you are doing guided tours etc, you need to be insured for it and any vehicle you use to transport guests needs to be insured too.   Your insurance company may tell you this is not possible unless you have a taxi permit (this is what happened to me) but this is not true and you can get insurance for 'usage professionelle occasionelle'  which is not too expensive.  What is important is that any trips you take the guests on are included in the price of their stay and prebooked and that you are not paid extra like a taxi.  A subtle difference but worth knowing about!  If you want to advertise your services then be careful that you are actually allowed to do the things you propose, as tourist offices can and do check up.  There are all kind of weird and wonderful regulations and it is as well to at least be aware of them.

Quillan is right - if you find the get rich quick scheme I'll stand behind him in the queue to get the instructions.[:D]

[/quote]
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Do you accept cheques from Panama? [:P]

[quote user="Clair"][quote user="Cerise"]Quillan is right - if you find the get rich quick scheme I'll stand behind him in the queue to get the instructions.[:D][/quote]

I have found one, but it'll cost you €500 each...[:)]

[/quote]
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[quote user="Quillan"]

Because of the way we purchased our B&B we actually created our website some six months before we moved in which was in January and took our first guests in March

[/quote]

I agree with this, we created our website and published it in March

before we opened in July 2008 and had bookings throughout the summer

season and into Autumn. A spread of links from accommodation listing

sites is also needed to bring in the business.

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  • 1 month later...
Unless you are very well established (and no-one can really afford to rest on their laurels nowadays)  I would also have to stress the importance of marketing.  Time has to be spent investigating and assessing/monitoring marketing for any business.  Its absolutely no use unless you know where your guests found out about you. Marketing has to be effective rather than just done and forgotten about.  If it doesnt work, change tactics but only once you know whether it was the wording or the location of the ad that didnt get you results.

I worked as PA/Office Manager based in a 4 star country house hotel and restaurant in rural perthshire.  The market was partly the shooting and golfing fraternity, therefore money was spent in some of the golf guide books and magazines, shooting times etc as well as the Tourist Board.  We got very few booking through the expensive adverts in magazines so cut back to special issues.  Also, the business had been built up over 18 years of good reputation yet my employer was still quiet over lunchtimes in the restaurant.  'Light lunches, set price?', I suggest....   'Did those, no-one came'... was the reply.  Can we try again, I suggest.  Sure, if you want.....  2 months later we were permanently busy over lunch mid week despite being in the middle of nowhere.  Instead of running for just 3 months the lunches became available all year round except December.  It took only 2 ads in the local paper just big enough to get noticed, and a monthly ad in the village newsletter (£11/month) which although living there 18 years they didnt use.  The previous attempt had been to print the menu, leave it in the lounge area midweek (quiet) and noone ever saw it.  I have great respect for my employer.  He started with nothing, was a outdoor clothing rep, then got a chip van and a night shift job to supplement. He set up an outdoor clothing shop in Edinburgh, then a few years later got into catering etc.  He now owns 40 rental properties, 4 hotels and a golf course but still couldnt market this properly.   So, so important.  He's worked his socks of for 40 years but think of what he could have had - it doesnt just stop at lunches!!

Websites DO take considerable time to appear in the rankings even with key words and phrases utilised.  Pay per click can cost a fortune and where do you stop?  But for accommodation businesses aiming at an international market they are essential, as are the links from accommodation sites you can subscribe to.  Never forgot the locals, neighbours and areas tourist attractions.  Word of mouth is just as important.  Sorry, sorry, gone off on a tangent here, but amazingly even the most intelligent people often overlook what should be the most obvious when in business. The OP was asking how the recession is affecting things. A fellow UK hotellier says he is 20% down over his 3 Scottish hotels compared to same period last year but the advance bookings from the USA and Europe are really up. We no longer have the hotels so cant comment, though golf course and restaurants are busy.  The recession will just sort the men from the boys.  Hope you are all the former.

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  • 2 weeks later...

According to the travel trade media, the amount of Brits booking eurozone holidays are dramatically down, with many opting for countries such as Turkey, Egypt and South Africa where the £ has held up in value. Those who are still going to eurozone destinations are reverting to package holidays, so they have an all inclusive £ cost.

Some Gites might see an increase in business as holidaymakers downgrade from hotels, but I would not be complacent about relying on bookings from eurozone nationals, as since this thread was started it has become apparent that the economic crisis is just as bad in Europe, as the UK.

Who will be badly hit, as is already the case, are the restaurants and bars, with reports from the French ski resorts that the slopes were reasonably busy this season, but the restaurants and bars empty.

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[quote user="Sprogster"]

Who will be badly hit, as is already the case, are the restaurants and bars, with reports from the French ski resorts that the slopes were reasonably busy this season, but the restaurants and bars empty.

[/quote]`

You are spot on with that, the resorts faired not too bad on numbers but those spending money were few and far between;

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I said this at the beginning of the year about holidays and there is a distinct rise in people taking 'all inclusive' deals in Spain etc.

Round here we are seeing a massive increase in French (as in Central and Northern French). We have loads of Spanish, Belgium, German and Dutch in the area at the moment, far more than in the last 8 years. This is good news as it helps fill the hole.

As far as restaurants go we wanted to go out for dinner today and can't get a place anywhere half decent and remember its not a public holiday in France although it school holidays.

As to Europe being 'just as bad as the UK' I disagree. I am not says its good by a long way nor has it been unaffected but its not as bad either which is why I make Sarkozy right in what he said at the G20. Rather him than Brown but then we are drifting off subject.

The other comment about marketing in the other post is something I have said time and time again. We have just gone through a big marketing exercise and dumped a load of companies/sites we have had bad results with. We have also spent hours on the Internet using different search criteria in both French and English to see who comes up over the first 6 pages of every search and on which page. We have signed up with a couple of French companies which were not cheap but the results have been very good having got our money back inside 5 days.

As I said before you have to keep a record of how people find you, either directly or indirectly. Set a budget and stay within it. Also look at advertising that charges commission only. If they don't sell your rooms/gites they get nothing so its in their interest to promote you. If they don't then you loose nothing except for the time entering your details.

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Quillan,

It depends on which eurozone countries you are talking about as for example the economic situation if far worse in Ireland and Spain, compared to anything the UK is experiencing.

What you are probably thinking of is that the UK is running a higher budget deficit, but if this keeps UK unemployment well below the eurozone and gets the UK out of recession earlier, then in hindsight a budget deficit and weak £ might not be such a bad thing.

What is clear that unless the euro comes back to a competitive level against not just the £, but most other currencies such as the US$, then it is likely the recession in the eurozone will last much longer than the UK and USA. A lot of people do not appreciate that the UK is the eurozones largest export market and therefore the weak £ is having a significant dampening effect on the eurozone economies. 

The problem in the UK in part is the media and the British syc that likes to talk eveything down. As for President NS, unfortunately yout apparent confidence in his opinions do not appear to be shared by most French voters according to opinion polls!

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At the risk of going off thread I disagree.

Spain has its own problems especially in the building industry. This is made worse by the fact that people from outside the Euro ar not buying and other factors like with the Germans etc. Likewise Ireland has unique problems. Both have had their problems made worse by the collapse of the £ and Dollar.

Why should the Euro go back to a competitive level. It never went up, the £ and the $ went bang. We see no change in prices in Euroland. The problem is with the Â£ and the $ not the Euro.

The UK imports from Eurozone is mainly food which is why, as predicted, the price of food in the UK is gradually creeping up because they have to pay for it in Euros and its the only place they can get it.

I agree with your comment on Media hype but also it would be helpful if they told the truth.

After several 'experts' predicting the crash of the Euro over the last 6 months I am still waiting for it to happen.

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Not so Quillan, the UK is one the biggest single export market for many eurozone manafactured goods such as cars and aircraft.  Also the UK is France's biggest export market for wine and champagne and this is collapsing against an influx of cheaper new world wine. Food can and is increasingly sourced from outside the eurozone, from countries like Israel, South Africa, North Africa, New Zealand and Turkey, to name a few.

It is not just my opinion as someone that is working in financial services at a senior level, that the euro is overvalued and not only against the $ & £, as this view is shared by the ECB, most international financial analysts and President Sarkosy himself. The reason is quite simple, in that the ECB has maintained so far a higher base interest rate policy, which attracts international investors, as they can can obtain a higher return on overnight money and has nothing to do with international confidence in the eurozone economy, as quite the contrary Europe is increasingly being perceived internationally as an economic basket case, with unemployment in some eurozone countries like Spain over 18%!

This will change as the interest rate differential turns around, with the UK and USA likely to be the first countries out of recession and increasing base rates rapidly to ward of inflation. Meanwhile, the eurozone saddled with an overvalued currency against most other countries and the challenge of bailing out the economies of the weaker eurozone and East European countries will probably endure a longer recession.There probably won't be a crash of the euro, but a gradual weakening over time. Most currency analysts see the £/euro rate around  1.22+ by the year end compared to 1.114 today.

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To my mind you are just saying whats in the UK press but little of what is really happening.

China has just bought 600BN worth of Euros in April. South America wants to move from the dollar to Euros. All these countries are in talks with OPEC about moving from the dollar to the Euro.

Most developing regions, South America, Asia and Afria are seriously looking to the Euro and away from the dollar. Even the Arabs are looking to move away from the dollar.

It seems to me and I am no expert but just follow the world news from many sources that the pound is doing better. The Euro has not changed, its not devalued, its just that sterling is doing a bit better. That is until some bright politician says something to screw the pound again.

I can't remember the 'group' name but its been mentioned a few times during the G20 summit of those that want to move away from the dollar and I have grass to cut and a hundred and one things to do so I don't have time to look it all up and give links. Perhaps I might do it tonight if I have the time.

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But the eurozone countries don't want the euro to be an overvalued reserve currency, because of what they see an overvalued Yen did to Japan in decimating its exports. Expect the ECB to reduce interest rates to 0.5% and introduce quantative easing within the next couple of months, as eurozone average unemplyment moves over 10%. Not having ever lived in the UK, I a not looking at this as a Brit versus France thing, its just my job!

 

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At the G20 summit the suggestion emanated from China that a new global reserve currency be created  for central banks to hold funds and it is being considered. This was not aimed at the euro, but the creation of a 'world dollar'.

Developing regions switching from dollars to euros does not create jobs for the eurozone countries, it simply pushes up the value of the currency, reducing eurozone competitivness    destroying jobs in the process. This is why Switzerland are taking active measures to try and reduce the value of the Swiss Franc, as foreign investors have bought it as a safe haven currency.

The likes of Merkel and Sarkosy want to be relected and a strong euro is not a electoral plus, if it has led to mass unemployment and riots on the streets as jobs get switched to lower cost countries.

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I don't want to be rude but I just get fed up with people implying that its the Euro that has a problem, is unstable and over valued. In fact its the other way round, its not unstable and its not over valued, its the other currencies, namely the dollar and sterling that have a problem. I don't know about the experts but it tells you something when China and the South American countries want to use the Euro for international transactions and also OPEC want to move off the dollar to the Euro. All these groups are currently in negotiations, I just can't remember the name of the group but it was mentioned on C4 News during the G20 summit. I don't think these countries are stupid and neither is OPEC, they just want a stable currency to trade with and they feel its the Euro and have done for several years now as is documented if you search on google.

As you rightly say this is not the thread to talk about this really although these issues do have an indirect effect on both gite and B&B bookings with regards to holidaymakers from outside the Euro zone.

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To go back to the original question - my bookings are as good as 2008, in fact they were better for the first quarter of the year. Gites just about fully booked April - September with about the same ration of UK to other nationalities, so the recession hasn't had an adverse effect here [:D]

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I have a slightly unusual perspective on this, in that although I have lived in France a long time and so apparently wouldn't need  a Gîte in fact I often spend time in them, either to change region, or with English friends who invite me to share.

Last year with friends I spent 10 days with friends.

This year it will be 3 weeks.

In both cases it is the people from the UK with a sterling income who took the initiative, so it seems from my experience anyway that there are still clients.

On the other hand these are small places for 4/5 people with a budget in early or late season (May/September) of around £400 a week not more.

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Perhaps it all goes back to location again. I have been unable to find a suitable gite for my family in the Pyrenees - Orientales on a convenient date. I have been very surprised that most places seem to be solidly booked for July and August.

Hoddy
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