Newfoundland and Labrador Product Development Strategy

- 157 -o Has evident potential in other group market segments – meetings/conference,incentive travelo Is located in an outstanding settingo Fits with the unique appeals and character of Newfoundland & Labradoro Complements existing tourism development in the areao The project is sustainable from all perspectives – financial viability, environmentalcapacity and community/cultural acceptanceo Competent proponents are available to undertake the initiativeo A reasonable level of non-government funding is availableThere are really no resorts meeting this test in the province today, however, the new HumberValley Resort appears likely to do so.It would be unreasonable to expect more than a few major resorts in the province in themedium term and, in fact, the feasibility of such projects is not clear as yet. As discussedlater, this kind of development is likely to require a level assistance to become commerciallyviable in due course.Competitive Impacts IssueWith respect to competitive impacts, discussed shortly below, the development of a resort isintended to ‘grow the pie’; increasing the demand for the area to a considerable extent. A trueresort is, in fact, a destination in its own right. At the same time, it is sure to draw somebusiness away from other operators in the region, since the resort will have appeals to othertravellers as well as those using it as a destination in its own right. On the other hand, it isimportant to realize that some people drawn to the area by the resort’s amenities andmarketing will opt for other accommodations in the area instead, particularly if the others aremore reasonably priced and particularly if they can still get access to the resort’s amenities ona day-user basis. In this case, the other operators are getting new business on the back of theresort’s efforts.Also, perhaps reluctantly, other operators will be challenged to strengthen their appeal to suchtravellers, which will have the effect of upgrading accommodations in the area moregenerally. This is a good thing, not a bad thing. On balance, quality operators in the areashould come out ahead in spite of the shifts in demand. That will be less the case with lowquality properties.Competition of This Kind Is GoodCompetitive pressures are both healthy and necessary if the industry is to grow and evolve.Entrepreneurship needs to be rewarded. All of these considerations are necessary to properlyjudge whether the benefits of the resort project outweigh the negative impacts on otherproperties in the area. The raising of objections should not be sufficient in itself to disqualifythe project.THE ECONOMIC PLANNING GROUP of Canada Newfoundland & Labrador Tourism Product DevelopmentD. W. Knight Associates Strategy and Accommodation Needs Study