CRUISING INDUSTRY ANALYSIS

Cruising Industry Analysis



Cruising Industry Analysis

Introduction and Purpose

Cruise industry has gained considerable attention in the Central American region and the Caribbean. The cruise industry is being regarded as an attractive economic advancement opportunity within the domestic region. As far as the United States market is concerned, it accounts for more than 62 percent of the travelers, including the markets of Caribbean and North America. CLIA was founded in the year 1975 with a goal to provide a platform for the cruising companies for North America to come over and share the issues of general concerns (Baker, 2009).

Presently, the organization is comprised of 21 biggest cruise lines, having more than 180 vessels and the travel agencies in the organization are almost about 16.500 (CLIA, 2007b; Dowling, 2006). If we critically observe the figures of the North American cruise market it is growing annually with a growth rate of 8.4 percent from the period of 1980 to 2000. In the year 1980, the number of cruise passengers in North America was around 1,431,000, and that number jumped to 6,882,000 in the year 2000. A survey results by CLIA concluded that almost 69 million people are substantially interested in adopting a cruise ((Petrick, 2007).

A careful understanding of the cruise industry can aid the identification of the potentials and downsides of a selected driver of financial progress. The purpose of this paper is to look at the literature on the cruising industry, the analysis of the industry structure and performance, and a brief conclusion on the basis of the analysis.

Literature Review

According to (Ritter and Schaffer, 1998) cruising may be described as “a multi-centre holiday where people can carry their hotel with them from point to point” (p. 23). Cruising has made it simpler to enter into the shipping business, after the introduction of steam. It is so because the capability to conduct scheduled services that do not depend on the wind was significantly improved (Cartwright & Baird, 1999, p. 23). The initial ocean 'pleasure' cruise took place in the year 1881 when the Oceanic Yachting Company acquired P & O's (Peninsular and Oriental Steam

Navigation Company) S.S. Ceylon, and refitted her as a full-time cruise for the European market. (Baker, 2009) recommend that the industry kept on growing and by the 1900 beginning, the White Star Line, P&O and Hamburg America Line were providing customary cruises.

The cruise tourism expenditure has direct, indirect and induced effects on the economy. The direct effect is when a vendor sells a range of goods and services to cruise ships, its crew and passengers. Among the expenses the ship has port costs, shipping costs, food and beverages, fuel, water and maintenance. Costs associated with passengers include those that are not part the cruise itself, i.e. taxes, gifts, shore excursions, food and beverage mainly. At the expense of the crew found, among other things, restaurants, medical services, recreation, transportation, etc. Indirect effects resulting from direct purchases from suppliers, such as products purchased from other companies. The Induced effects occur when the recipients of direct ...