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Visit Scotland | Alba

In March 2021, the First Minister announced a new £25 million tourism recovery programme. The recovery proposals were developed by the Scottish Tourism Emergency Response Group (STERG) in collaboration with members of the Tourism Task Force and represent initiatives which are over and above the scope of current public agency funding.

It was the recommendation of STERG and the Tourism Task Force that these proposals would not only accelerate recovery in the short term, allowing tourism to once again contribute to communities and to the economy of Scotland, but would also provide the foundation for a sustainable recovery of Scottish tourism in the medium to long term, setting us back on track towards the ambitions of Scotland Outlook 2030.

 

The Scottish Tourism Emergency response Group (STERG) coordinated the delivery of these projects. The 10 recovery proposals are detailed on this page:

  1. International demand building
  2. Destination and sector marketing fund
  3. ScotSpirit Holiday Voucher Scheme – social tourism
  4. Days Out incentive scheme 
  5. Visitor management strategic infrastructure planning and delivery 
  6. Tourism and Hospitality Talent Development Programme 2021/22 (phase two)
  7. Leadership development to boost product innovation
  8. Destination Net Zero 
  9. Scottish Tourism Observatory 
  10. Investment models to support Scottish tourism recovery 

1. International demand building

The Scotland is Calling campaign has been a huge success with campaign videos being viewed over 114 million times in our priority international markets (final results still coming in), with a high level of engagement.

Traffic to visitscotland.com increased by 44% during the equivalent 7-month period year on year, and SEO searches for Scotland increased by 16%.

Tour operators are reporting bookings for Q3 2022 at similar levels to 2019, and strong demand for 2023.

£1.4 million in grants were awarded to Scottish based inbound tour operators (Inbound Operator Marketing Fund – IOMF) to promote Scotland tours in key international markets.  Activity delayed due to Omicron – initial reports due May 2022.

Search and booking figures from Expedia in North America, show strong upwards trend, outstripping some of our key competitors who were not active during the same period, showing the value of sustained investment.

2. Destination and sector marketing fund

Overall, the Destination & Sector Marketing Fund has supported 73 destination organisations and sector groups to develop and promote unique visitor propositions to a domestic audience. These campaigns were focused on positioning Scotland as a year-round destination to help stimulate immediate recovery.

The fund operated across three tiers offering different levels of awards. Tier 1 was open to the cities and offered the largest level of award, tier 2 was open to regional destination organisations and national sector groups with tier 3 available for local destinations and regional sector groups.

Across the main award and the subsequent top up the Destination & Sector Marketing Fund has distributed a total of £4,531,648 across the three tiers.

This has meant that 50 destinations have been supported representing 30 of the 32 Local Authorities across Scotland as well as 23 regional and national sector groups which operate across the country ensuring that the funding has been able to have an impact nationally.

3. ScotSpirit Holiday Voucher Scheme – social tourism

Destination related:

  • Boost to the regional investment (accommodation, retail, transport, hospitality, attractions, cultural sector)
  • Promotion of a destination’s tourism potential to the wider public

Social:

  • Increased citizenship awareness and participation in community life
  • Health & mental health benefits

4. Days Out incentive scheme

  • 144 visitor attractions, activity providers and day tour operators benefited from £1.6 million Grant Award funding
  • Over 240 individual days out offers promoted on www.visitscotland.com
  • VisitScotland’s Scotland targeted marketing campaign reached over 1.1 million views across national and regional media, including paid social, press, radio and digital ads plus owned channels promotion
  • Over 143.000 pageviews of the Great Days Out campaign page on www.visitscotland.com
  • 37.000 referrals generated to participating businesses

5. Visitor management strategic infrastructure planning and delivery

Initially 11 plans were approved for funding from the £500.000 secured for phase 1 delivery. Utilising underspend from the Better Places Fund a further 13 have been approved for development. Our total support for these plans now comes to £775,542.

Of the first batch of 11 STIDPs, eight local authorities have now submitted completed plans.  Although 1 has not provided costs at this stage, the total value of the other seven plans comes in at over £23 million for the first three years.  The remaining three are due for completion in the next three months.

Those Authorities which have completed their STIDP submitted an additional 24 applications for further detailed development grant to work up the projects ready for implementation by 1 April 2023.  Of these, 16 were approved in March 2022.

With a further 13 new strategic development plans still at the initiation phase, there is  strong evidence of a pipeline of projects for the next 3-5 years which will address the strategic priorities and key infrastructure issues across significant tracts of  rural Scotland.

6. Tourism and Hospitality Talent Development Programme 2021/22 (phase two)

The National Transition Training Fund Programme (Tourism and Hospitality Talent Development Programme) has been extended until the end of June. To-date 1,350 participants have undertaken the training with 449 businesses engaging with the programme from across Scotland with additional stand alone modules scheduled for May/June with 300 places available. Participant feedback shows 96% of participants either satisfied or extremely satisfied with the programme.

The Head Chef training has been completed with 66 participants undertaking the training. Feedback from the programme was extremely positive with 100% of participants who returned feedback questionnaires saying they would recommend the training to colleagues or externally.

The Collective Labour Saving Technology research and pilots have been completed and a final report received which will be disseminated to industry partners and stakeholders.

The Climate Emergency training has been completed with 67 participants completing the training. Two climate emergency webinars were delivered to 74 participants. The course was well received with participants highly engaged throughout.

The mental health and wellbeing programme was over-subscribed with additional funding made available from Skills Development Scotland to allow increased numbers to be trained. 148 delegates undertook the range of training including 68 who achieved the mental health first aid certificate. Extremely positive feedback on the training received from the participant survey.

The Tourism Induction Toolkit has been delivered by J&G3 and is now ready to be shared with businesses across the sector through a range of industry portals.

The training programme, Complete Storytelling, has been completed with 10 training programmes delivered to 205 participants.

The Talent Attraction programme has been delivered by Springboard with 92 industry ambassadors signed up as industry ambassadors and 303 young people registered on the Careerscope portal. Over 800 school and college students have engaged with the sector through the Springboard Futurechef programme and other outreach activity. 722 senior pupils have had access to chef specific on-line resources from 45 schools across Scotland.

The Disability / Inclusion Programme has so far trained 120 tourism employees with an additional 80 scheduled to be trained up to the end of June.

7. Leadership development to boost product innovation

216 additional tourism leaders with skills in areas including destination development and management, responsible tourism and net zero; community tourism and destination governance are now active in the visitor economy across Scotland. They join an existing network of more than 500 destination, community and rural tourism leaders.  Their learning is now being applied in areas identified as key to the sector’s post-coronavirus (COVID-19) recovery including the development of destination climate action plans, community wealth building activity and the repositioning of Scotland’s visitor offer as a responsible tourism destination.

Ten innovative recovery projects have been created and delivered, led by destination and community leaders in collaboration with industry, public, third sector and academic partners.

 

Outputs include:

  • A community calculator allowing the business events sector to record and measure the impacts of conferences to the host community – providing data to positively influence conference bids and manage community impact
  • Improved visitor management in fragile rural communities using IoT (internet of things) to facilitate safe and sustainable tourism including engagement with local communities ensuring responsible tourism is delivered
  • The joint development and implementation of innovative digital solutions within Scotland’s visitor attraction sector enabling increased revenues and greater resilience whilst encouraging sustainable management of attractions
  • A community wealth building approach led through the creation of Scotland Community Tourism Network – generating revenues across this growing element of the tourism supply chain

 

Further outputs include:

  • A robust and sustainable commercial business model for Scotland’s agritourism sector lead body
  • A framework to drive collaborative product development with small & medium enterprises in the visitor economy using local assets and working with existing and emerging leaders

8. Destination Net Zero

The Destination Net Zero project has set the conditions to create a greener tourism sector which demonstrates commitment through delivery to Scotland’s Net Zero agenda and Tourism Outlook 2030 aims. It has created a robust, globally recognised evidence base against which industry ambitions will be developed, monitored and supported.  The project has developed a framework for a sector which invests in its people, businesses, places and communities confirming Scotland’s position as a responsible tourism destination.  It has positioned Scotland as a global leader in the development of policy, strategy and actions to enable a transition to a net zero visitor economy.

The project has supported the sector to have the capacity, capability and innovation ability to invest in low carbon initiatives. It has increased business resilience and set the scene across Scotland within all business sizes for the adoption of carbon reducing strategies. The project has pump-primed tourism destinations and communities to collaborate around low carbon initiatives and provided exemplars to inspire further action.

 

Specific outputs:

  • 19 infrastructure investments were delivered creating a portfolio of demonstration projects across Scotland’s anchor tourism assets – showcasing carbon reduction measures and development approaches which can be replicated
  • Additional leverage of £3.73 million investment from other sources as a result of a £1.9 million DNZ infrastructure investment in 19 projects
  • Innovation and community wealth creation projects delivered in remote rural locations with long-term assets including community owned EV and e-bike infrastructure
  • Support provided to circa 310 businesses to undertake carbon reduction activities including development of carbon monitoring plans, installation of kit including EV charge facilities and food waste reduction measures
  • Engagement of 231 businesses through a range of events, one to many, one to few and online engagements (workshops, seminars etc), and over 7000 stakeholders engaged through online channels
  • 47 media pieces mentioning Destination Net Zero with a reach of over 8,560,725
  • Creation and ongoing development of online industry facing resources through dedicated Destination Net Zero space on visitscotland.org
  • Creation of new digital tool which uses geospatial data to engage EV drivers and e-bike users with nature and local communities whilst charging
  • Delivery of a suite of research and evidence including, informing on attitudes and industry capabilities around carbon reduction:
    • Scottish tourism carbon baseline
    • Tourism business research
    • Consumer research
    • Development of an action plan for Destination Net Zero Phase II
    • Circular Village/circular economy study for the events and creative sector
    • Events sector Net Zero action plan

9. Scottish Tourism Observatory

The target phase 1 outputs were achieved within the funded period (up to March 2022) as follows:

  • Phase 1 user research
  • Phase 1 data discovery
  • Identification of technical requirements
  • Phase 1 options appraisal
  • Phase 1 commission, design and build of an MVP, an initial product consisting of development of a website and provision of back-end architecture and data pipeline for the observatory
  • A workstream of Stakeholder engagement and support from the tourism industry for the project

 

Phase 2 planning and business case is contingent on further funding being available to support the ongoing development of the observatory.

10. Investment models to support Scottish tourism recovery

The research attempted to present an overview of the financing of the Scottish Tourism sector drawing from available data and intelligence.  This used the FAME database which draws information from annual accounts filed at Companies House.

Through stakeholder engagement and consultation, information was also gathered on the investment funding options currently available to tourism businesses and the challenges that businesses in tourism faced in obtaining finance to invest.  A number of considerations for Scottish Government and its agencies in the development of any future investment options in support of the Scottish tourism sector and a range of possible options were also identified.

The findings of the research included:

  • Banks are the most active participants in tourism funding market
  • Other participants include lending from other companies, generally from related party entities, or in some limited cases from suppliers
  • Other (non-bank) lenders such as asset based finance providers also play a minor role in providing secured lending

 

At the time of the data being gathered:

  • A significant portion of businesses had interest cover less than 1x EBIT.  This suggests that these entities may struggle to obtain additional funding as lenders may have concerns about their ability to service debt
  • Around one in ten businesses had a debt ratio in excess of 60% with these entities possibly finding that existing debt levels are too high to obtain more lending as banks may have concerns about whether there are sufficient assets to enable repayment in an insolvency scenario
  • A large portion of entities had a liquidity ratio of <10% which may indicate a lack of available cash or liquid assets to fund investment, or to make payments on new or existing lending

 

Given the point at which this data was captured by Companies House, these KPIs are likely to have deteriorated in the last 12- 15 months as a result of the impact of coronavirus (COVID-19). 

A number of considerations were identified which will require to be resolved in the event that any future Scottish Government or agency investment intervention is to be developed. These included as aspects such as approach, pricing, sustainability and eligibility criteria, in response to what is a very diverse sector with many micro and small businesses.

A number of different financing options were also identified.  These included mezzanine finance, mezzanine finance plus additional bank or shareholder borrowing, bank lending guarantees, preference shares, equity.

The Strategic Tourism Infrastructure Development Fund

The Strategic Tourism Infrastructure Development Fund is a pilot initiative designed to support more extensive and collaborative projects from visitor hotspots across Scotland that are facing immediate and damaging pressures on their infrastructure or negative impacts on communities as a result of significant increases in visitor numbers since the summer of 2020. 

The Strategic Tourism Development plans will identify the key infrastructure issues at various locations, the barriers to be addressed including planning, environmental impact, legal and landowner issues, the costs for the development of the infrastructure, and the timescales required for delivery of the essential infrastructure over the next two - five year period. These development plans are due for completion by the end of December 2021. 

Phased approach to recovery planning

A phased approach is being taken in order to meet specific timescales set by the Scottish Government.

Phase one: A set of priority recovery proposals which outline the immediate support required from Scottish Government in the coming six months to two years. This is over and above the urgent need for ongoing business support to ensure business survival.

On 24 March 2021, £25 million was secured to support the delivery of 10 priority recovery projects.

      Approved funding for year: 2021/22     Resource Capital Total

1

International Demand Building     £8 million   £8 million
2 Destination & Sector Marketing and Product Development Fund     £3 million   £3 million
3 ScotSpirit Holiday Voucher Scheme – Social Tourism £1.4 million   £1.4 million
4 Days Out Incentive Scheme £4 million   £4 million
5 Strategic infrastructure Plans   £0.5 million £0.5 million
6 Tourism and Hospitality Talent Development Programme 2021/2022 £2.5 million   £2.5 million
7 Leadership development to boost product innovation £0.662 million £0.1 million £0.762 million
8 A Net Zero Pathway for Scotland’s Tourism Industry £0.75 million £3.2 milliion £3.95 million
9 Scottish Tourism Observatory   £0.8 million £0.8 million
10 Investment models to support Scottish Tourism recovery £0.05 million   £0.05 million
  Total costs for year: 2021/22 £20.4 million £4.6 million £25 million

Phase two: A package of recovery proposals identified through a comprehensive stakeholder consultation carried out in spring 2021.  The proposals identifying activity up to 2024 were designed to provide a pathway to recovery for our industry and destinations and are designed to deliver outcomes aligned to Scotland Outlook 2030 at the same time. STERG is continuing to review the proposals, which were submitted to the Scottish Government in August 2021, and assess their value in the long-term recovery, taking into account the ever-changing landscape of the pandemic and its impact on businesses.

Scottish Tourism | Two-year recovery recommendations

Published November 2021

Phase three: Secure the necessary funding and support to implement the two year recovery recommendations.

Benefits

Delivering a tourism recovery and investment plan will deliver benefits which underpin the four key outcomes identified in Scotland Outlook 2030:

  • A more resilient, agile sector capable of managing future shocks and change, building longer term sustainability and profitability.
  • A greener low carbon exemplar sector which delivers tangible community and social benefit, creating and developing sustainable destinations.
  • Skilled sustainable workforce with improved employee working conditions built on fair work principles creating a committed, diverse and valued workforce.
  • A globally recognised sector – considered world class in key sectors and providing the very best, authentic and memorable experiences.

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