A. Niemczyk and R. Seweryn - Influence of meetings industry on the economy of Krakow

Conference industry: perspectives and development directions of Lviv Lviv, March 11, 2015

Agata Niemczyk Renata Seweryn Tourism Department Cracow University of Economics

Conference industry: perspectives and development directions of Lviv Lviv, March 11, 2015

1. Kraków as a tourism destination 2. Kraków as a business tourism destination 3. Methodology of the influence of meetings industry on Kraków’s economy 4. Impact of the meetings industry on the economy of Kraków in 2013 5. Conclusion

Krak贸w as a tourism destination

Source: http://pl.wikipedia.org/wiki/Stare_Miasto_w_Krakowie# mediaviewer/File:Krakow_rynek_01.jpg

Source: http://wyborcza.pl/1,75475,13853942,Pod_znakiem_lwa__Festiwa l_Kultury_Zydowskiej_odmieniony.html

Source: http://www.bryla.pl/bryla/51,85301,8431541.html?i=4

Source: http://krakow.dlastudenta.pl/st udia/artykul/Miedzynarodowy_ Dzien_Otwarty_na_UE,30393.ht ml

Source: http://www.sfora.biz/gospodar ka/Oto-najlepsze-galeriehandlowe-w-Polsce-g50453

Number of tourist guest

10 000 000 9 000 000 8 000 000 7 000 000 6 000 000 5 000 000 4 000 000 3 000 000 2 000 000 1 000 000 0

9 900 000

7 250 000

Total number of visitors Domestic visitors

Foreign visitors

2 650 000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: data of research conducted at the request of the City Office, under the supervision of the Małopolska Tourism Organisation

Krak贸w as a business tourism destination

Source: http://pl.hotels.com/de1053546-th14p2/biznesowe-hotels-krakow-polska/page-2/

Source: http://www.tripadvisor.co.uk/Hotel_Reviewg274772-d1728175-Reviews-Hilton_Garden_Inn_KrakowKrakow_Lesser_Poland_Province_Southern_Poland.html

Source: http://www.parkinn.pl/hotel-krakow Source: http://www.polhotels.com/Cracow/Qubus/index 2.htm

Source: http://krakow.pl/ccb/11614,artykul,miedzynarodowe _centrum_targowo-kongresowe_expo_krakow.html

Source: http://wislacanpack.pl/wisla-can-packkrakow-zagra-w-krakow-arenie/

Source: http://news.o.pl/2014/03/24/zbigniewpreisner-centrum-konferencyjne-ice-koncertkrakow/

Number of tourist guest

Total number of business visitors

1 000 000 900 000 800 000 700 000 600 000 500 000 400 000 300 000 200 000 100 000 0

7,78%

Domestic business visitors

770 000

Foreign business visitors

570 000 7,86%

200 000 7,55%

2008

2009

2010

2011

2012

2013

2014

Source: data of research conducted at the request of the City Office, under the supervision of the Małopolska Tourism Organisation

 

 

In 2012 – 1855 group meetings In 2013 – 3413 group meetings In 2012 – 286 898 participants In 2013 – 427 980 participants

22%

2012

Events

42%

59%

75%

2013

46%

2012 0%

20%

8% 8%

2% 17%

3% 8%

2% 5% 40%

14%

47% 60%

80%

Conferences/congresses

Fairs/exhibitions

Incentive events

Corporate events

Source: Own study based on PCB POT database.

100%

Participants

42%

2013

I 5% 7%

10%

9%

10%

11%

5% 4%

11%

12%

9%

6%

II III

2013

IV V

VI VII VIII IX

X 7%

7%

12%

9%

9%

8%

6% 5%

10%

10%

11%

7%

2012

XI XII

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Source: Own study based on PCB POT database.

1 day

2 days

3 and more days

80% 70%

60% 50% 40% 30% 20% 10% CE Nat.

CE Nat.

CE Inter

CE Inter.

IE Nat.

IE Nat.

IE Inter.

IE Inter.

F/E Nat.

F/E Nat.

F/E Inter.

F/E Inter.

C/C Nat.

C/C Nat.

C/C Inter.

C/C Inter.

0%

2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 C/C – congress/conference; F/E – fair/exhibition; IE – incentive events; CE –corporate events Source: Own study based on PCB POT database.

„For our city congress is like a plane throwing dollars�

Smith G.V. (1990), The growth of conferences and incentives [in:] Quest M. (ed.), Horwath Book of Tourism, Macmillan, London, p. 68.

Steering the meetings industry in Kraków: assessment and monitoring of the economic effect of the meetings industry on the economy of Kraków with the use of good practices from Switzerland PROJECT CO-FINANCED BY SWITZERLAND UNDER THE SWISS PROGRAMME OF COOPERATION WITH OTHER EUROPEAN UNION MEMBER STATES

Krzysztof Borodako – chief Jadwiga Berbeka Agata Niemczyk Renata Seweryn

www.krakowimpact.pl

Methodology of the influence of meetings industry on Kraków’s economy

Primary data taken from Cracow Convention Bureau of the Municipal Office of Kraków – MICE tourism in Kraków research (years 2008-2011)

Primary data taken from Poland Convention Bureau POT (Polish Tourism Organization) years: 2012 and 2013

Primary data taken from main surveys (92 business meetings, 1294 entities on the demand and supply sides of the meetings industry)

Secondary data taken from Central Statistical Office of Poland

Secondary data taken from Statistical Office in Kraków

Used data Primary data taken from pilot surveys (16 business meetings)

Selectioned data taken from program: Kraków’s Scientific Meetings (years 2012, 2013)

Secondary data taken from reports: Travel and tourism economy in Kraków

Secondary data taken from: Statistical Yearbook of Kraków

ď ˝

ď ˝ ď ˝

participants in congresses and other group business meetings of similar character (congresses, conferences, seminars, symposiums, training sessions, workshops and other corporate events, incentive events), visitors to trade fairs and exhibitions, exhibitors at fairs

Shopping

13

Recreation

28 33

Entertainment

68

31 39

9 13

Culture

95

71 67

21 27 11 15

Transport Food and drinks

86

47 48

Accommodation during the meeting Accommodation before and after the meeting

74

252

121

178

30

76

23

Integrative event Fair admission fee

10

Participation fee USD

226 0

Trade exhibitors

30

60

90

120

Trade visitors

150

180

210

240

270

Meetings participants

Source: own calculation based on survey results.

30,91% 32,00%

Shopping 3,64% 4,00% 2,51%

Recreation Entertainment

3,64% 10,40%

Culture

26,40% 29,29% 26,28%

45,24% 45,45%

49,09% 45,60% 53,26%

Transport Food and drinks Accommodation during the meeting

66,80% 78,18% 64,89%

40,80%

Accommodation before and after the meeting

40,00%

1,60% 6,92% 3,64%

Integrative event Fair admission fee

94,55% 83,20%

32,80%

Participation fee

83,45% 0%

Trade exhibitors

10%

20%

30%

Trade visitors

40%

50%

60%

70%

80%

90% 100%

Meetings participants Source: own calculation based on survey results.

1800

1 684

100%

98,18%

90%

1600 1400

80%

1 311

70%

1200

60%

1000

50% 800 600

711 596

506

30%

400 200

20% 9,09%

7,27% 62

0

USD

40%

Employment Fair Handling of additional Agency staff from services Krakow

3,64%

5,45%

1,82% Free tickets Organisation Advertisment Costs of for partners of an event for renting space partners at the fair

10% 0%

Source: own calculation based on survey results.

Group (Sector) Group 01 Handicraft, retail sale

% share in the group (sector) 13,76%

Group 02 Hotels

76,85%

Group 03 Restaurants

24,18%

Group 04 Transport

12,69%

Group 05 Travel agents, guides

9,00%

Group 06 Culture

22,60%

Group 07 Recreation, physical well-being

16,01%

Group 08 Creative industries and others activities

14,45%

Source: Own study based on survey results and on the data obtained from the Statistical Office in Krak贸w.

Idea of Multiplier economic effects

The increase in tourism traffic THE LOCAL ECONOMY a flow of capita development of small and medium enterprises new jobs generated

higher turnovers of local enterprises more money earned by local population more taxes paid to the budget

K = a + b + c, where: K – Multiplier economic effects on the area, a – Direct effects, b – Indirect effects, c – Induced effects.

T&T INDIRECT

Accommodation Catering, Entertainment Recreation, Transportation & other Travel Related Services Printing/Publishing, Utilities Financial Services, Sanitation Services, Furnishing & Equipment Suppliers, Security Services, Rental Car Manufacturing, Transportation Administration, Tourism Promotion, Ship Building, Aircraft Manufacturing, Resort Development, Glass Productions, Iron/Steel

T&T DIRECT

T&T INDUCED

Food & Beverage Supply, Retailers Business Services, Wholesalers, Computers, Utilities, Manufactures, Housing, Personal Services Source: The Comparative Economic Impact of Travell & Tourism, WTTC, November 2012, p. 4.

Impact of the meetings industry on the economy of Kraków’s in 2013

GDP

The adjusted value of the GDP for the meetings industry group in Krak贸w in 2013 was

USD 329,6 mln.

The share of the GDP of the meetings industry amounts approximately to

2.37% of the GDP of Krak贸w in 2013.

Employment

Group (Sector) Group 01 Handicraft, retail sale

Number of employed* 980

Group 02 Hotels

3 163

Group 03 Restaurants

1 617 768

Group 04 Transport

61

Group 05 Travel agents, guides Group 06 Culture

886

Group 07 Recreation, physical well-being

182

Group 08 Creative industries and others activities TOTAL

1 233

8 890

* The number of employed quoted is equivalent to the number of employees in the statistics of the Statistical Office calculated as full-time equivalent employment.

Source: Own study based on survey results and on the data obtained from the Statistical Office in Krak贸w.

Having accounted for indirect and induced effects, the number of employed was

12 214

estimated at persons for the entire meetings industry in Krak贸w.

The overall share of the employment generated by the meetings industry was

3.25% of the entire Krak贸w economy in 2013.

Salaries

Total value of gross salaries in USD 5 041 015

Group (Sector) Group 01 Handicraft, retail sale

17 545 119

Group 02 Hotels

Group 03 Restaurants

3 724 018

Group 04 Transport

7 170 752

Group 05 Travel agents, guides

Group 06 Culture Group 07 Recreation, physical well-being Group 08 Creative industries and others activities TOTAL

49 9 480 147 15 043

528 962 925 373

58 202 692

Source: Own study based on survey results and on the data obtained from the Statistical Office in Krak贸w.

Having taken of account of the indirect and induced effects, the overall value of net salaries in 2013 in the entire meetings industry in Krak贸w was

USD 97 378 924.

The overall share of the gross salaries generated by the meetings industry in the entire economy of Krak贸w in 2013 was

4.0%.

Taxes and levies

Types of revenue stream entering the Treasury of the Municipality of Krak贸w

155 441.20

Corporate Income Tax (CIT)

14 555 791.83

Personal Income Tax (PIT)

Natural Persons Business Tax paid in the form of a tax card Other taxes and levies (including real estate, vehicle and local taxes)

TOTAL

Amount in USD

80 937.16

3 709 771.90

18 501 942.1

Source: Own study based on survey results and on the data obtained from the Statistical Office in Krak贸w.

Having accounted for the indirect and induced effects, the overall value of taxes and levies generated by the meetings industry in Krak贸w was estimated at

USD 27 630 686.

The overall value of the taxes and levies generated by the meetings industry

2.4%

corresponded to of the revenue of the Treasury of the Municipality of Krak贸w in 2013.

Terms of impact of the meetings industry on the economy of Krak贸w GPD

USD 329.6 mln

Employment

12 214 persons

Salaries Taxes and levies

Amount in 2013

USD 97.3 mln USD 27.6 mln

The overall share in the economy of Krak贸w in 2013 2,37% 3,25% 4,00% 2,40%

Source: Own study based on survey results and on the data obtained from the Statistical Office in Krak贸w.

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