Financial benefits and strategies of sustainable tourism

At a time when environmental considerations are becoming a priority for many people, sustainable tourism has seen an increase in popularity. It is more important than ever for businesses to consider how to operate in a more sustainable way.

It is very easy to see the costs associated with becoming more environmentally friendly. However, embracing sustainable tourism can also lead to significant financial advantages.

Matt Crabtree, Director at Westcotts, explores the advantages of adapting your businesses to become more sustainable.

Economic advantages of sustainable tourism

Increased customer loyalty and attraction

Today’s tourists are increasingly eco-conscious and are keen to use businesses whose practices align with their values. The term sustainable tourism is when businesses adopt sustainable practices. These businesses can then attract a growing market of environmentally aware travellers. This group of customers are often willing to pay a premium for services and products that are ethical and sustainable. This can lead to increased revenue and customer loyalty.

Cost savings through efficiency

Although some sustainable practices do come at a cost, becoming more efficient is usually better for the environment and cheaper for the business too. Energy consumption can be reduced by simply using more energy efficient appliances. Solar panels can be installed to save electricity and lower electricity bills. Water butts and other water saving measures can be used to save water and reduce a business’s water cost. Reducing waste through recycling and composting will reduce a business’s waste but also save on disposal costs. The savings made by these efficiencies can be significant for businesses operating on small profit margins.

Enhanced reputation

Sustainable tourism is not just a trend and will continue to be an important factor in the future. Becoming a sustainable business can also enhance reputation which in turn will make it more attractive to potential customers. Having a strong brand can lead to an increased market share and will allow the business to charge premium prices. It is also true that, at present, businesses that are seen as ethical and sustainable are more likely to receive media attention and awards. This can be a great source of free publicity which in turn will further boost the business’s reputation.

Implementing sustainable financial strategies

1. Start small – adopt green practices

For a business just starting to look at its environmental impact there are some simple green practices to adopt easily. Start with cost saving measures that do not need a lot of investment such as reducing energy and water consumption, minimising waste, and purchasing products from local suppliers to reduce the business’s carbon footprint.

Investing in renewable energy such as solar or wind power can further reduce operating costs and environmental impact. Implementing a recycling programme and inviting guests or customers to participate is also a fantastic way to enhance sustainability. It also lets your customers know what you are doing in terms of sustainability and makes them feel a part of it.

2. Offer sustainable/environmentally friendly experiences

If a tourism business is going to tap into the sustainable tourism market, then it is important to offer tailored experiences that potential customers in this market want to buy. The experiences should highlight and preserve the natural and cultural heritage of the local area. Customers could be offered eco-tours which provide educational value while minimising their environmental impact. Local tourism businesses could partner together to offer sustainable experiences which also help support the local economy. Whatever the product or experience, its sustainable nature needs to be clearly highlighted to appeal to the market.

3. Engage and educate customers

It is important to educate existing and potential customers about the sustainable practices of the business. It is even better to encourage them to participate. This can be done through online leaflets, guided tours, or interactive experiences which showcase the businesses commitment to sustainability. Engaging customers not only enhances their experience but also enhances the businesses reputation and encourages customer loyalty.

4. Obtain a certification

A very useful way to advertise within the realms of sustainable tourism is to get verified by a recognised certification scheme. The one to choose may depend on the exact nature of the business but there are lots available from places such as Green Tourism or Travelife. These certifications can enhance credibility and attract environmentally conscious travellers.

These organisations can also help you monitor and report on your sustainability activities. It is important that sustainability is monitored so that the business can assess what is working well and what isn’t so that improvements can then be made.

5. Look for grants

Before you undertake any investment to make your business more sustainable you should look at available grants. Government and environmental groups are keen to help businesses participate in sustainable tourism and so there are often grants available for projects or investments that will reduce a business’s environmental impact. Sometimes these are national schemes, other times they are localised to a specific area. It is worth looking at what grants are available from the government, local authority or other organisations before making any investment.

6. Consider possible tax savings

As well as being good for the environment there are some sustainable activities that benefit from favourable tax treatments as well. If your business provides cars to its employees, then providing electric cars instead of diesel or petrol cars is likely to be more tax efficient for both the business and the employee. Providing charging points to employees to charge their cars also benefits from a more favourable tax treatment than paying for employee’s diesel or petrol.

Businesses can also take advantage of the cycle to work scheme allowing employees to purchase a bike through their employer and save tax on the payments. The purpose of this is to encourage employees to cycle to work instead of using a car.

Sustainable tourism for your business

Sustainable tourism offers businesses a wealth of benefits. From protecting the environment, to supporting the local economy and contributing to a healthier planet. In addition, it helps businesses achieve significant financial benefits, improving the long-term viability of the business.

As sustainability becomes more important to tourists, businesses that embrace these principles are likely to see substantial success and growth in the years to come.

If you would like to discuss any of the issues raised in this article or the possible tax savings brought by investing in environmentally friendly assets then please contact Matt Crabtree at matthew.crabtree@westcotts.uk or call 01803 618910.