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The Sky the Limit - The Future of the Hospitality Industry in Indonesia

Updated: Jun 15

During his 29 years in the dynamic world of travel and tourism, Pacto Inbound Chief Operating Officer Umberto Cadamuro keeps innovation and business growth at the forefront of company strategy.

Mr. Umberto Cadamuro- Chief Operating Officer Inbound at Pacto Ltd
Mr. Umberto Cadamuro- Chief Operating Officer Inbound at Pacto Ltd

His steady career trajectory from expert Tour Leader to Contracting Manager to Director of Operations and Business Development to his present role as Chief Operating Officer is built on versatile experience and comprehensive knowledge of the travel industry.

Please tell us a little more about yourself and your business?

At pacto, we like to say that we cater to Tourism Related Services. This is because in 55 years of operations we have learned that, by enhancing a customer minded approach to business, the landscape of opportunity is basically endless when it comes to tourism, ranging from flight tickets to hotels to transportation, food, guiding, fishing, sailing, special project, experiences, and the list could go on forever.

Belajar Menenun - Source
Belajar Menenun - Source

What make tourism such a great industry for Indonesia?

I do not know of any other country in the world offering the diversity that Indonesia does, be it in the cultural field, the natural wonders of the archipelago, the bio-marine diversity or historical such as the findings of the Homo Erectus dating back to over 1,5 million years ago, and what possibly is the oldest pyramid worldwide, the 20,000 years old Gunung Padang. Under this point of view the tours business, and the very important hard currencies that it generates, is just at the beginning. The development can and will be enormous assuming the understanding of the unique strength of Indonesia.

If you could change two things how hotel should do the business, what would they be?

Apparently, the biggest lessons hotels could learn from covid 19 has not been fully understood : when facing unpaid, non guaranteed debts from overseas operators all you can do is write them off as bad debts or accept huge debt reduction or a heavy rescheduling of payments. On the other end, local operators, and the Indonesian jurisdiction that goes with their contracts, offers the opportunity to recover or reschedule in a reasonable way eventual bad debts, unlike contracts with foreign jurisdiction whereas cost make recovery impossible.

There are no statistic on this, but I assume foreign unpaid or heavily rescheduled debts to be easily a thousand times the amount of those of the local operators. On the operational side, I would like to see check in and check out at reception to become history, replaced by online check in and check out with keys pick up-drop off only as Accor is doing extremely well especially in Europe. Saving cost to hotels and offering a better experience to clients, avoiding long queues especially when arriving from a long haul flight is a really good win-win solution.

Please describe major changes you have seen in the hospitality industry in Indonesia and what is your suggestion to others about it?

Starting around 2010, we have witnessed the growth of volume tourism given the opportunities generated by low cost carriers. After the long break due to covid 19, we are now seeing a new situation given the expensive and very limited airlift in the post covid era.

This is already generating a different kind of client that has a better spending power than before, since he can afford much higher flight cost. It is therefore time to re-think the approach to competitive business in terms of being more experience and satisfaction minded than price minded as in the past. The future, at least for few years, will be lower volume but higher revenues.

Please describe major challenges in the hospitality industry which need to be addressed ?

One of the major issues our clients are reporting is the lack of investment in advertising. I trust our Ministry of Tourism to address soon this issue so to be able to help the operators to increase sales to Indonesia in the near future.

What are you excited about the future of hospitality industry in Indonesia?

Why should we be not excited about the future of the hospitality industry in Indonesia? The sky is the limit....



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