I don't understand this, the rooms, tours, meals still have to be paid for in Thailand to those providers.

"Zero baht tours involve companies providing everything for tourists - flights, accommodation, tours, meals - and picking up a single payment in their home destination, so Thais and Thailand make ''zero baht'' from the visit by the tourists to Thailand."

Also stated was:

"Khun Methee said that some individual resorts looked set for a reasonable 2011 but generally, room rates were not recovering because there was an oversupply on Phuket."

Well stated, and now they are building more.

Posted by Lee on January 24, 2011 18:43

So the rooms they stay in cost 'zero baht' to rent do they ?? The food the tour co buys to feed them costs 'zero baht' ?? The drinks they consumer are given to them for free by the local Thai businesses ??

Thailand has to learn to compete... When price meets service people pay it.. When the service is poor, or the price too high, companies will find ways to service it in house and remove Thais from as many steps as possible.

Posted by LivinLOS on January 24, 2011 18:56

dear ed,
so as a russian tourist i can only order the zero baht tours? That would be a monopoly. But the russians like to go with zero baht tours, because everything is provided by one hand, without fear of ripp offs... That would be too boring for me, but again, its a free world or not?

Posted by Lena on January 24, 2011 19:39

I'm a bit confused about what the legal grounds are for banning these companies.

Khun Piyasuda Sukcharoen only refers to unacceptable behavior. What is that exactly and unacceptable to whom ?

I'm not defending or accusing either of the sides, I just wonder what the rules of the game are.

Does Thai law state that products provided in Thailand cannot be paid for abroad ? I doubt it.

Sounds all arbitrary to me.

Tourists should be free to choose all inclusive packages if that's what they want.

Since quite a few Russians seem to prefer them, what's preventing Thais from offering similar deals to them ?

Surely TAT has offices in Russia - just use those marketing millions and put together all-inclusive packages provided by Thai owned businesses and let the customer choose.

Phuket always prides itself for being an international holiday destination.

Guess what - with that "internationalism" you also get international competition.

Posted by Chris on January 24, 2011 22:00

I'm confused as well. If a company pays for it in the first place to make a package to the tourist, the money goes into thailand - no ?

It's called competition, Thailand have become a lot more expensive and to much greed that farangs now can competite with Thais. The only valid reasons it have become a problem for Thai (Oh no, we can charge more, now the farangs can competite with us - BAN THEM)

After all, it's amazing Thailand!

Posted by Anders on January 24, 2011 22:19

Dear ed,
as a half russian, i can assure you, Russians have a choice, they can book zero baht or go with big fishs or alone. Some like McDonalds, so because McD is bad for whatever, we ban them for 5 years? You must be desperate.

Posted by Lena on January 24, 2011 22:37

Zero Baht means zero opportunity for graft. The fees for accommodation, food and entertainment goes to Thais, just not the skim.

Posted by Cap't Kirk on January 25, 2011 05:18

I understand the perceptions against "zero baht tourism" but surely these tourists still need hotels and restaurants which will have to employ Thais and use Thai suppliers and pay Thai taxes.

It would be impossible for a big chunk of this money not to end up in the local economy.

As for the McDonalds argument if you look at California for example you can see that independent burger chains are still very successful e.g. In & Out Burger and numerous others.

Posted by Rob on January 25, 2011 09:52

LOL rather funny article. There is not such a thing like Zero Bath tours, let me tell you that as a former tour operator for SEA. Since ever, people could choose to book and pay for packages including most things like flights, transfers, accommodation and even food provided in the hotels, if wished so. That does not mean, that's the tour operator to cash in all the money, as tour operators do pay for local companies for transfers, tours, they have to pay the hotel for accommodation and food and beverage.

By the way, I have never heard about anybody going on a holiday and not spending any money there. People buy souvenirs, clothes, snacks, beach chairs and so on.

Maybe it should be called by the name. Phuket people don't like the rude behaviour of some of their Russian guests. They don't like Russians setting up tour offices in Phuket. They don't like Russians to take business away, that could be done by locals. But question, how many locals can communicate in Russian?

Phuket wanted quantity instead of quality, and that's what happened the last few years. Maybe time to think about it. But hold on, what did I read today; future development for Phuket sees 5749 more rooms, representing a 12.9 percent increase over existing supply. See what I mean..?

Posted by Mack on January 25, 2011 10:10

Hello, zero baht ?????
the staff at the hotel get paid, the tour bus gets paid, the food is grown in Thailand, there is no such thing as zero baht it is called business in the real world.

Posted by Lord Jim on January 25, 2011 10:24

Ed, I understand your point. Though the money paid for the services in Thailand stays in Thailand, the profit margin is largely taken up by the tour companies who buy the products in bulk.

There is still money and profit staying in Thailand but I agree it is certainly much less than if the tourists would purchase those services and products on their own.

To call it "zero baht" is misleading for this reason. "Low profit sharing" is a mouthful but more accurate.

What is interesting is why nobody seems to ask themselves why this kind of tour package is gaining popularity.

If a survey was taken among those booking this kind of trips, I'm quite sure that the scams and overcharging tourists read about on a daily basis play a significant role.

Such a package makes the costs predictable and leaves no room for overcharging.

Imagine a tour company offering 24/7 transportation for the duration of the holiday for a reasonable fee. I bet you that product would be extremely popular and the reason lies in the Tuk-Tuk scams.

Everyone, regardless of their nationality, hates to be cheated. Since authorities on Phuket can't or don't want to get rid of the scams, tour companies come up with ways to avoid exposing their customers to them.

The tourists are clearly voting with their feet.

I agree with you 100% - this is certainly not good for Phuket but who do you want to blame it on ?

Posted by Chris on January 25, 2011 10:25

Well folks, Phuket tourism is dead. We spoke about this issue two years ago and only now has everyone woken up. Glad to have a tourist free Phuket back, no we can all think about the past in realistic fashion.
I do not believe the hotel occupancy figures, or the TAT figures, money speaks and it did not arrive this high season.
Keep on dreaming you bean counters?????

Posted by GrahamM on January 25, 2011 10:25

and if the russians can't get an 'all-inclusive' holiday in phuket then they will go elsewhere.
people book this kind of holiday because they don't want hassle.
why don't thai operators offer the same type of holiday to the same tourists if they want a bigger slice of the pie??

Posted by another steve on January 25, 2011 11:53

Dear Editor, let's face it. Phuket has become a rather expensive destination for individual travellers. So the only way to keep figures up is selling cheap packages in new markets like Russia for example. Obviously the margins for the locals are smaller that way. But you can't expect to sell a cheap product and expect high spenders. If you sell a cheap product you will attract all kind of people but unfortunately, too many low spenders.

I noticed on my last visit to Phuket, that the majority of guests nowadays are from Russia and Scandinavia. Well, at least do most Scandinavians seem the travel to Phuket with good budgets and spend quite some money. I could not observe the same thing with most Russians.

Phuket has just become an other Canary Island attracting similar guest, behaving in a similar fashion as they would in European beach resorts. Unfortunately, that's not what Phuket needs.

Posted by Mack on January 25, 2011 12:15

"Editor Comment:

''Zero baht'' is like fishing with dynamite. It not only pollutes the water, it destroys the end product - tourism. No income being returned to the destination country means the destination dies. I'm surprised Russians haven't got the message."

What cloud number are you living on? Nine? Phucket IS already destroyed, what do you want? The Thai's are only p*ssed because the russians are obscenely much better scam-artists than themselves, that's the only reason they "cry baby" now, waaah!

Posted by BOM on January 25, 2011 19:13

I'll certainly second that Ed.

The governing structure of Phuket is far too complex with all types of village headmen,OrBorJor, Mayors, governors, Navy Chiefs, Police Captains, Immigration Kingpins and who knows what other Phu Yai with their eyes only on their own interest.

The power is so decentralized that no-one seems to have authority over the island as a whole.

I used to think the Governor had the authority but with time I have learned of the challenges he is faced with.

People only care about their own Tambon or wallet and don't care about Phuket as a whole.

It's turning into a place where far too many powerful people come to just rape the land and take as much as they can with little or no thought spared for neither the environment or the future of Phuket.

It is horrifying to see the things people do for profit and it's getting worse at a pace I cannot believe.

I mean - what kind of people would bury garbage on a pristine beach ? What makes incidents like that worse is that there are no consequences for the offenders.

Isn't there anyone in Thailand with enough authority, decency and common sense to put a stop to this madness before Phuket is lost forever ?

Posted by Chris on January 25, 2011 20:02

Bad luck that you censored my last comment.

Me and Mr. Chaiwoot Chaipan from Chulalongkorn University wrote about "zero dollar tours" from China back in 2006 already - and we tried hard to define it.

Unfortunately, our article was in German - so you might not have the language skills to read it:

Friese, Martin; Chaipan, Chaiwoot (2006): Chinesische Touristen in Thailand: Chancen und Probleme eines neuen Marktes
in S'dostasien Informationen Nr. 4 * Seite 45 - 47.

Anyway. Not the best paper in this world - but at least we knew what we write about - without all this - "bloody foreigners exploit Thailand" stuff.

Posted by Martin on January 26, 2011 03:56

Can you give the names of that "SIX RUSSIAN tour firms," please????

Posted by Dmitrii on January 26, 2011 08:35

My last ski-ing holiday in Austria was paid for in pounds sterling in the UK. It included, flights, hotel, breakfast and dinner, ski lift passes and bus transfers. I had no idea the Austrians were handing it out for free. What the Russians are doing is offering package tours - just like every other nation on earth and what, exactly, is illegal about that? The Thai's get paid, the Russians drink and eat out (check out the queue at Fuji in Jungceylon every evening. Ooops, shouldn't have mentioned that - that's JAPANESE food).

I just don't get it. Thais should be grateful, not greedy. Talk about shooting yourself in the foot! And why, Ed, do you always defend the indefensible?

Posted by A. Skeptic on January 26, 2011 09:13

If Russian investors want to buy or develop hotels in Thailand then they are allowed to according to the laws on foreign investment.

If Russian tourists chose to use these hotels then that is their prerogative.

Either way the hotel still needs Thai staff, Thai suppliers and to pay Thai taxes and utilities.

International chains have been in Thailand for decades and tourism has thrived so not sure what the problem would be.

Posted by Rob on January 26, 2011 11:14

Where is the "mob and mob thinking" in my comment?

Foreign and multinational companies have been building in Thailand for decades, why should not the Russians now that they are emerging from decades of repression?

Rather than me providing evidence that something is not happening, how about you providing evidence that the Russians are "nationalizing" the Thai tourist industry. I put it to you that you can't, and the very idea is preposterous.

The simple truth is that Thailand does not want anybody to benefit from Thai tourism except a Thai national, even though the tourist agents that send their clients here work had to get their customers. That's greed.

Posted by A. Skeptic on January 26, 2011 16:39

I thought I was dumb, because I don't understand which is the problem. Luckily it seems I'm not the only one.
Surely there must be some good reason, but it has been poorly explained. Isn't this what they do in Maldives for instance? People pays abroad a full board and don't have to spend a penny on the island...This is what Club Med does. You buy a package all inclusive. Why Russians are banned and the Club Med in Kata is not?
There must be something else, but it is not clear.

Posted by Jonathan on January 26, 2011 20:38

What Khun Methee writes is utter fantasy and merely supports my point of view. For example: ''Everybody knows who is behind this but somehow this just goes untouched.'' Who/what is she/he referring to? An unsupported, unsubstantiated inflammatory statement. The whole article runs along emotional but unsupportable and wild accusations. Give me a break!

Posted by A. Skeptic on January 26, 2011 21:32

Dear Editor,

I for one, by the way a former tour operator for SEA, have no idea what Khun Methee is saying. As I said before, I never heard about such a thing as ''Zero Bath Tour''. Must be an Asian invention.

A tour operator abroad has his local tour operator in Thailand. Often, there is a foreign representative of the tour operator abroad connected to the local tour operator. It's the local tour operator in Thailand, that provides most services in Thailand, like transfers or tours and I never heard about any local operator doing that for free. The local services are provided by Thais, therefore there are making money from the tour guests.

Now as for the poor tourist being taken to shop after shop after shop. Well, that's a good one indeed. How do you force your guest to join those shopping tours? Maybe at gun point? In my humble and professional opinion are guests free to join those tours if they choose to. And anyways, what's wrong with that? Even if the operator would get a commission from those shops, don't the taxi and tuk tuk drivers get commissions as well, if they bring customers to certain shops? Don't those shops belong to Thais and therefore make money with this tour guests?

As for the hotel, well, tour operators abroad normally have direct contracts with the hotels and payment is normally made directly to the hotels. But let's not forget, that even if that hotel is foreign owned, they still have to pay local taxes. They still need locals to work for them and they pay them salaries. They still have to buy food, beverages, cutlery, glasses, towels and so on, which they buy in Thailand?

As I said, I don't understand this ''Zero Tour'' phenomenon. I sent this article to two friends working for different tour operators in Europe, and none of them has a clue either what this is about.

But then again, this is Thailand.

Posted by Mack on January 27, 2011 11:14

This is what commonly do tuk-tuk drivers expecially in Bangkok. Bring tourists to shops where they get a commission, often ripping the tourists with prices far too high for what they're buying.

This is funny, this year hotel and guest houses of Phuket would have been in big trouble without russians tourists that replaced the swedish tired of being ripped by jet ski operators and tuk tuk drivers. Peaceful people I must add, families, kids.

The tourist agencies of Thailand should think of how to stop scams by thais because the fact that this year there have been russians instead of swedish is the consequence of years of neglect by authorities that let the situation worsen every year.

Building in every possible corner of the island making the place a hell of traffic an pollution, cement everywhere. A friend of mine came to see me in Phuket, one hour and half of traffic to get from Thalang to Chalong, and he said he'll never come again to Phuket.

Instead of blaming the authorities that are doing nearly to nothing (more and more scams by jet skis operators) they put the blame on others...

Don't think russians are stupid, those agencies have the contacts, they bring people to Phuket , and next year they could send people to Philippines or somewhere else. But after all , for those not involved in tourism maybe is better, so that the island will return a little to the past and people will smile again as it was twenty years ago.

Yes, we all are naives, all of us.

Posted by Jonathan on January 27, 2011 16:53

Dear Editor, please get your act together and let me quote you;

''If you're happy to support the concept of tourists getting into a tuk-tuk or a taxi and being hijacked to a relative's gem store, then your notion of what's satisfactory in the tourism industry is lacking.''

I can not remember telling you about me being happy with what you implicate, did I? I was simply telling facts as a former professional of this business. And by the way, you where saying that ''Zero Tours'' no leave money in Phuket and now that?

????????????????Although I am not in the industry????????????????

Well dear Editor, I have been in the ????????????????industry???????????????? for too many years, but it sounds to me, like you are calling me an ignorant, even you are not in the ????????????????industry????????????????? By the way, I personally as a certified tourism manager, would not call it an industry.

????????????????I have seen busloads of Koreans eating night after night only at certain Korean restaurants on Phuket.????????????????

And where do those restaurants get their stuff, food, cutlery, glasses and so on from? And aren????????????????t those restaurants paying taxes in Thailand?

????????????????I have a pretty good idea of how national alliances and collaborations work, and how attempts are made to infiltrate and manipulate to make more profit.????????????????

Well, here you got me completely lost. Sounds like a huge conspiracy to take over Phuket. Please, get real.

????????????????Those who do not understand what happens in this ''scam'' are, in my view, naive. It's a tourism takeover, pure and simple.????????????????

You are not into the tourism business, but you call us who have been there na?????????ve. I wonder, how long yourself have been involved it Phuket. I visited the first time almost 20 years ago and have many local friends, which are involved in Phuket????????????????s tourism.

Look Editor, I don????????????????t want to put you down mate. But accept your limits and don????????????????t try to become Phuket????????????????s almighty please. You confess that you are not in this business, but still you want to tell us professionals about it? Please give it a thought, before you hit the keyboard again, unless you take the easy way out and just don????????????????t publish my reply.

Best regards

Mack

Posted by Mack on January 27, 2011 21:36

Fair play to the editor.

He lets us people put their comments and while he might disagree with some of them at least he engages and states his own arguments up front.

Not a lot of news organisations are willing to do that.

Mind you it must be hard to write the story and then be objective when there is a barrage of different comments coming from all angles, some reasonable and some rude.

Hopefully all people can engage in sensible, mature debates for the benefit of the island's development.

Posted by Rob on January 31, 2011 10:01

see it all balances out, Zero Baht Tour scam cancels out Zero Tour Fare scam.

One set of tourists gets trapped in the hotel, scuba tour and restaurant controlled by their own people.

the other set gets funneled into a purely Thai-controlled situation.

nice!

Posted by JingJing on February 2, 2011 01:41

How that is be zero Baht? Are Thai restaurants letting them eat for free, or Thai hotels letting them stay for free? Of course not. Even though everything may be pre-paid, there is still plenty of money coming into Thailand...

Posted by orange on March 9, 2013 14:39