Building tourism atop ‘hanuts’ and ‘lager louts’

Tourism is not a topic on which I claim any expertise. It’s big internationally, ranking behind only fossil fuels, telecommunications, computer equipment and automotives. It’s big in Turkey, out-performed only by automotives and textiles as a generator of foreign currency.

That much I do know. So I was glad to see the attention given the gathering of top hoteliers who gathered in Istanbul this week for the Central Asia and Turkey Hotel Investment Conference. I wish everyone well.

I hope I wasn’t somehow a spoiler when I had coffee at the conference hotel with an investor who invited me to stop by at the suggestion of a mutual friend. But the pace with which she took notes when I mused from my limited knowledge suggests there’s a side of the industry that is little discussed. Our discussion became lively when it turned to the topic of “hanut.” This is a term well-known in tourism circles, little-known outside of them. So we might as well get it out on the table.
The word connotes commission. But since the actual Turkish word is “komisyon,” easily understandable in many languages, “hanut” has become the code for the under-the-table deals dotted across the industry.

Once upon a time, this was just the 10 percent one would get for bringing a tourist to a shop at the covered bazaar; let me admit I had such just an arrangement with carpet store owner “Yücel” 40 years ago when I in was high school. But it’s gotten much more sophisticated in the interim.

The price to access the cab stand at the higher-end hotels fringing Antalya begins at 30,000 euros per taxi per season. Thus shuttle service initiatives die a quick death.

The big mall-like compounds of jewelry, leather or carpet stores that one sees near most of the major tourist region airports are an interesting case study: when a bus disgorges its passengers, the fee is 10 euros per head for everyone entering the neo-bazaar. So what are the odds of the bus taking its cargo to the city center? Zero.

Parking, beach chairs and umbrellas all have their own opaque little economies. It’s a vicious circle, driven largely by the closed-circuit nature of the all-inclusive model that has taken hold. Yes, Turkey draws big numbers and some 33 million are expected to visit this year. But aside from the still-boutique level shares of Middle Eastern, health and cultural tourism, the majority of visitors are in the “come with one shirt and 20 euros and change neither” variety.

A hotel-owning friend taught me a new term recently: “lager louts.” It’s a pretty good description of the crowd you’ll see lined up for the bus transfer queues at many a seaside airport.

Tour monopolies control the commodity and each passing season further squeezes the margins in this commodity-based approach. Not much revenue leaves the hotel complex and so the “hanut” reflex grows sharper and more pervasive outside. It’s a kind of feedback loop that drives the sector to rely on “lager louts.”

Hope springs eternal. Perhaps the industry can yet deliver the long-promised prosperity. But I’m skeptical, I told the visiting investor. I am yet to be convinced a healthy and vibrant sector can be constructed atop hanut-seeking opportunists chasing lager louts.