African price wars!

[Patrick R]

Jaco, it's going to be a hard season for most of us. I have been around long enough and have weathered enough storms, 911 caused major damage to mention one of many, but we survived. I just don't want to be caught out like the hunchback, we have to adapt to the market. If we look at SA, worst drought in 40 years, game ranches in a lot of places aren't going to have enough food for the winter, would you rather get some money for the animals or just let them die. There are many reasons why people have dropped prices. Yes, I also don't like seeing sable going for 4500$ but what can I do about that......nothing, doesn't help if I try and throw my toys out the kot. If you look say 15 years back, you were lucky if you saw a ph with a new average type pick up. Nowadays every second ph just about has a new Landcruiser never mind average pickup. Money was being made, like all businesses, there are good years and there are bad years. Don't worry what the other guys are doing concentrate on what you do best.

And Jaco I do hope you have a successful season and it works out for you.

Simon, so true...but adapting to the "cut-throat" business; which it seems to be the majority of the market nowadays, will ruin the industry...and driving a brand new Land Cruiser nowadays at $40 000 a piece and more...hell, you really have to hunt to get paypack my friend!

 

[KWALATA SAFARIS]

Jaco, it's going to be a hard season for most of us. I have been around long enough and have weathered enough storms, 911 caused major damage to mention one of many, but we survived. I just don't want to be caught out like the hunchback, we have to adapt to the market. If we look at SA, worst drought in 40 years, game ranches in a lot of places aren't going to have enough food for the winter, would you rather get some money for the animals or just let them die. There are many reasons why people have dropped prices. Yes, I also don't like seeing sable going for 4500$ but what can I do about that......nothing, doesn't help if I try and throw my toys out the kot. If you look say 15 years back, you were lucky if you saw a ph with a new average type pick up. Nowadays every second ph just about has a new Landcruiser never mind average pickup. Money was being made, like all businesses, there are good years and there are bad years. Don't worry what the other guys are doing concentrate on what you do best.

And Jaco I do hope you have a successful season and it works out for you.

Simon the drought is not the reason for the pricing, nor is supply in demand, having sat back and looked at it for 15 years in this industry and scratched around with it for a solid 7 weeks, it is three things.

The lion three day "dog show" closed down certain outfitters still need the extra Money so SA buff/Sable are fast becoming the "new dog show"

Believe me when I say that these are not quality hunts coming in at that rate you are always going to sacrifice something somewhere and @TMS I'm definitely not complaining about my season I have a great one ahead, I am truly upset as I know what the repercussions are going to be on the hunting industry if this dog show continues.

As simple as that, now some may elect to leave it be, I don't.

There are different markets in our industry some sell Kia others Mercedes others Bentley all of them get what they pay for.

@Bushwack very true.

 

[KWALATA SAFARIS]

If an outfitter is selling hunts for which there is no game, it doesn't matter what price he sold it at, he's a fraud as you say. But I can't help but believe that if an outfitter sells 30 buff hunts in one show season, whether he has them available or not, an excessively low price came into play, that price is a part of the story.

Did this outfitter start out the show season intending to sell that many buffs knowing he did not have the animals to support that many hunts? I'm guessing no, I'd guess he's going to work his ass off to make sure he has the supply on hand when the clients show up. Whether he can or not, sounds pretty questionable. But my point is that if this all got started in the first place with an excessively low price, look what it lead to. I don't want to speak for @Jaco Strauss, but I think this is the point he's trying to make.

Point is quite simple Phil, selling at that cost is unrealistic, now a bunch of hunts are booked those hunter will get they're Buffalo, but they're going to be shot in and over a wide variety of conditions not condusive to a consummate hunting experience as@billc mentioned it is seen as an opportunity to introduce Africa to another hunter, but the reality is one sacrifices something somewhere when booking at those rates, that creates confusion, many times a unhappy client and damages SA's reputation.

No one can prosecute an outfitter for selling it the way he does, many SA outfitters sell kudu and buy them at auction same deal.

 

[KAROO WILD Safaris]

Jaco

I understand your concern. The prices being offered now are unprecedented and not sustainable in the long term. Any major appreciation in the Rand to the dollar will wipe out any profit for outfitters selling cheap hunts at tight margins. That's a risk they take and good on them if it pays off, if it doesn't I hope they honour the contracts they enter into. It's happened before that the Rand has moved the other way, the long term trend has been steady depreciation but short term it can appreciate considerably.

I think most hunters are educated enough to recognize the good value hunts from the cheap ones. Focus on what you do best and you will be as successful as before. Control what you can control, give your hunters great service, make them the best food, hunt with them personally, give them a memorable South African experience and your business will thrive no matter what everyone else does. You'll notice that the really cheap hotels offering the basics have hundreds of rooms and the more expensive ones offering more personal service have far less. They are two different business strategies and you have to decide where in that spectrum you fall. You know this already though

 

[BWH]

Jaco, I kind of agree with Simon. I see that I generally tip my PH more than you pay him!

Yeah... but your probably tip your waiter/waitress a hell of a lot more than the restaurant is paying them too.... probably 500% more!

 

[Pheroze]

You folks have the same concerns business people everywhere have. You trade in a highly unusual product but the business reality is the same. In law we have ass***** who conduct their business in a shoddy fashion, market in deceptive ways and charge commencerate with their crappy work ethic. Unfortunately, these lawyers set the standard by which all lawyers are judged and stereotypes abound. (yes yes I hear the jokes) So I respect what Jaco is saying. But the truth is that you distinguish yourself by what you do. You owe it to your employees and family to charge what you are worth and your name will be the best marketing tool you have. The shysters will make more in the short term but healthy budgeting, ethics and honesty (in pricing and work) will endure.

 

[billc]

You can say anything you want on pricing or quality of service. In the end the factor that decide what anyone charges and it is the one that 100% decides this is. How much each person wants to put in there pocket at the end of the week. Plain and simple and all the other factors play in to that in the end.

Jaco puts a $$ amount on his time after EVERYTHING else is paid for and feels he is right to ask for that. I TOTALLY AGREE with him that he has that right to get that $$$ amount. It is great that he is offering what he feels is bentley service and wants to drive a bentley.

Just understand some might want to drive a kia or a toyota and they have the right to look and ask for that to. If that outfitter is find with a smaller amount of $$ at the end of the week in his pocket good for him and me.

The fact that some offer lower cost hunt will not make the safari business end. What will make it end is guys offering more then they can for those dollars they charge or guys who cheat hunters or if any fraud gets involved.

 

[BRICKBURN]

But at the lower end, Wayne, I could easily see someone selling hunts for animals he doesn't have. ......

I can see it being done for sure. It is illegal.
Rhinocon is a great example of this type of crook. Selling hunts for game they did not have. The con game with more variations than I can imagine.

Jaco, characterized some hunts as "black top Safaris".
Sure, drive from farm to farm and hunt the game present. The only way to go if you do not own a large parcel of land and want to conduct hunts.
Unless you own a very large chunk of land you are going to have "concessions".
This is legal. Written agreement in place and take your hunters on a legal hunt.

It is not only South Africa where this kind of fraud happens. Zimbabwe and Mozambique have their share of over sell stories. Selling hunts for game that they know have not been present in the area for years. (Poached out)


Like you say Hank, Due Diligence is required by the hunter no matter where you plan to hunt. Sadly, it is true that the price leader is the method used to try and entice hunters into these scams. Over pricing would not work.

 

[rookhawk]

I sympathize with the PHs that must earn a living under the current international economic crisis that imperil their wages.

One peculiarity I remember from economics was this statement:

If a sector has less than 8% profit, competition leaves the sector. (no money to be had, I quit)
If a sector has more than 8% profit, competition enters the marketplace. (I want a piece of that!)

Usually the exception to this is scheming Oligarchs or fat cats in cahoots with government that create barriers to entry for competition. (like onerous regulation)

Now this is where I get really concerned for the southern Africa PHs I know whether SA or Zim because those economic rules above aren't going to be followed:

1.) There is no other work out there so many will work in order to eat and break even.
2.) Some with cash reserves will do deals at a loss hoping that competition will leave the market (PHs quit) and that they'll be the last ones standing, can raise their rates and recover the cash they hemorrhage selling hunts at a loss presently.
3.) There is an abundance of PHs far in excess of demand. Example: I went to a bar in Bulawayo and I must have met 50 legitimate "retired" PHs that have valid credentials but are on the bench.

This doesn't bode well for our friends that are PHs. Demand is going to continue to slide as hunting becomes less fashionable. Economics are such that their competitors are selling hunts at losses just to keep boys employed. Wages are being set by the lowest bidder so we have friends working at levels I find unacceptable for hazardous skilled professions.

Bottom line, it sucks and I'm upset for the PHs trying to feed their families.

Only hope I see that is within the control of the PH under the present hostile conditions: Reinvent yourself. Provide a unique differentiator for your hunts. Different habitat. Different species. Different type of camp. Different experience. Different accommodations. Different pursuit. Different offerings. When commodities like PHs are trading at all time lows, you have to become something other than a common and comparable commodity.

For the non-PH readers: now would be a good time to book a hunt. If you like your PH you better support him NOW or they may not weather the storm.

 

[ActionBob]

How did we go from the just plain in-accuarate math and flat out wrong quotes on fuel price,,,,, And the huge advantage and ABILITY of South African outfitter to BOTH reduce prices AND INCREASE profit to... The South African hunting industry is going broke? I call BS.

 

[BRICKBURN]

How did we go from ...............

X to Y

 

[KWALATA SAFARIS]

How did we go from the just plain in-accuarate math and flat out wrong quotes on fuel price,,,,, And the huge advantage and ABILITY of South African outfitter to BOTH reduce prices AND INCREASE profit to... The South African hunting industry is going broke? I call BS.

@ActionBob R13 a liter is presice even R14 per liter depends where you refuel we pay double per gallon you pay.
Prove me wrong...
I put in a crap load of fuel on a monthly basis, how much fuel does a Yamaha 4 stroke 90hp use per kilometer? I know I run them.
In Moz I pay more than double a gallon up to R20 a liter.
I do math I also understand running cost, you on the other hand I don't believe do in terms of running a safari company.
In short we pay in SA over $3 per gallon give 20 - 40 cents above $3 here and there, fuel in Dallas was less than a buck 30....
The oil price might work in your favour not in ours my dear sir.
The industry is not going broke at least I'm not, but outfitters or some of them are seriously underestimating what will happen in SA this year.

Maybe it's allot of the guys losing lion hunts, I don't know all I know is they are going to hurt.

Point in case I quoted a old client on a 1x1 $7k couple 100 dollars up or down.
For 8 days in Limpopo
And
1x eland
1x Impala
1x waterbuck
1x Blesbuck
1x warthog
I gave him this stunner deal because he is an old client, I'll never give this to a first timer.
His reply was that this very hunt should sell for $3k less...........
$4560!!!!! $4560!!!!!!
My reply was you are unrealistic I wish you luck on your safari.

I don't care I just know he'll be back, I do the math, I understand the industry, in 15 years I should hope so..... I know the true cost of a safari.....
Outfitters do the math.... It's unrealistic.
You can quote what you like it's still not a realistic deal...... I think lions hurt guys more than we think..,

I refuse to play the price game...

My best.

 

[enysse]

I had a night to sleep and think about this thread. There are a number of problems or dilemmas in Africa right now.

1) The USA is playing games with hunters and artificially raising the pricing of elephant hunts in some areas because of importation restrictions. In other areas elephant hunts are not selling anymore because of these bans and are hurting outfitters and PH's everywhere.

2) Thanks to Cecil, we will have all sort of problems now and into the future to hunt lion and leopard. The price is likely to climb for leopard in areas it can be exported. Who knows about lions? Prices on wilderness hunts will continue to rise, ranch hunts in RSA..who know?

3) All the color varieties of blesbok, springbok, wildebeest out there..... They are not really natural, but breed. Could be future problem or current problem because of people spending ridiculous money at auctions for them.

4) All of the Cape buffalo, kudu, sable, nyala.....etc being breed and sold at auction. I always thought it was crazy and unhealthy at the level people were spending at the auctions, but who knows it wasn't my money.

5) Many years ago the ZIM leadership wrecked their monetary system. Now I think people are worried about leadership in RSA wrecking the RAND. And because of the crazy devaluation of the RAND, people are worried. People have a right to be worried about their business and livelihood is on the line.

It is still a free market out there. Customers heading to Africa need to do their research and see what is available and make choices based on what they can afford and the quality they will receive for their money. The BIG 5 is getting overall very expensive to hunt. Plains game hunts are reasonable right now.

 

[ActionBob]

@ActionBob R13 a liter is presice even R14 per liter depends where you refuel we pay double per gallon you pay.
Prove me wrong...
I put in a crap load of fuel on a monthly basis, how much fuel does a Yamaha 4 stroke 90hp use per kilometer? I know I run them.
In Moz I pay more than double a gallon up to R20 a liter.
I do math I also understand running cost, you on the other hand I don't believe do in terms of running a safari company.

My best.

Jaco my point being what I said earlier in the post. but to put it another way.. What the hell does the price of fuel in the US have to do with the change in the cost of running a safari company in Africa? BRICKBURN posted the RSA fuel costs "change" and with the change in the Rand to dollar, there certainly appears to be a lot wider profit margin potential. And some outfits have decided that rather than try to take advantage of all that, they will cut their rates when quoted in USD... Chasing a potentially smaller client base..

You are absolutely correct in that I don't know about running a safari company. But I do run a substantial business and deal with fluctuating costs and income level all the time. However they are my costs. I certainly don't do my budgets here in MN and SD based on the fuel price in Africa! Similarly you had at one point made comments about the price of brown bear hunts in AK. If I follow your unstated intention, you are trying to say that because hunters will pay X amount for a bear, African outfitters should charge an amount based on that for their hunts... Although I understand a World market view.. Another way to look at it is that you have a competitive advantage you can use to lure clients to you.... And I think that is the approach many of your somewhat less outspoken breatherin are doing. Jaco from a client viewpoint, and from the view of a client who understands the economics of business and how paradimes shift... You come off as an outfitter who is looking for any excuse to stick it to me and profiteer from my business.. And honestly about a year and half ago I would have put you at the top of my list of PH's I would have wanted to hunt with. Especially for leopard... But I'm sure you have enough loyal clients that my business does not matter anyway.

Now I do understand your costs in Mozambique may be different than is South Africa and that how they have changed from year to year is different.. I actually know so little about Moz that I don't even know what the currency is. And if you have to do business in there in USD, of course the exchange rate has not helped... but I don't buy the fuel cost is double of last year. And again, the price in the US has no more to do with YOUR cost of doing business in Africa than your costs do with planting corn in the Minnesota. That is where your quotes come off as BS to me.

 

[KWALATA SAFARIS]

It is what we pay in SA, cost of running I think you're making a grave mistake by not understanding, how running costs work, everything you do in SA as an outfitter costs you allot of money.

The dollar that a client pays can only be stretched so far, I don't know your buisiness, I honestly don't care, all my hunts are mid range even at $29k there are way more expensive leopard hunts than mine.....

Place me where you like Bob the fact that outfitters are unrealistic in they're pricing is very prominent this year, this comes from US customers side not just mine...

Fuel price is but one part there are many other real costs fuel was an example, your lack of understanding is very clear to see.

When you stood in my booth and tried to tell me what I should charge for pre baiting it was quite clear.
$100 a day for 10 days of pre baiting is very reasonable you wanted it for $50.

Calling me a crook might make you feel better, but that's ok, my product is different from many other guys product.

Ps don't assume I never said the fuel cost doubled from last year I said we are paying double per gallon, when rand is worked to $ and liter is worked to gallon.

The latter being a real cost as we earn $ convert it to rand to run properties and companies. The depreciating Rand is not to our advantage thinking it is, is absolutely redicoulas.

My best to you as always

 

[siml]

Jaco, seems that if someone doesn't agree with you they either an idiot and don't know how to run a business. I am in a far more remote area than you, I know the exact fuel costs. 2015 $ to metica(31), at the moment the dollar to metica is sitting at 48. At the moment fuel is costing 38 mets a liter. How is for example your leopard different(product) from many other guys product?

 

[robertq]

Let's do the math.
$8000 10 day buff hunt.
Good reliable ph: $100 per day on DG hunts
Cost to company: drinks, meals, fuel, electricity, tracker, skinner, maids... (All relevant to your day to day client to camp cost $2000 for the 10 days.
This leaves you with $5k, you have not paid medical, insurance, life insurance, bought groceries paid other ranch staff, bought feed, run the tlb that prepares roads, fixed broken water pumps, paid your vehicle, school fees, or any of the other costs I can mention.

Simple, I've seen if a hunter wants to be a small fish in a big pond low costs safaris are the way to go, exclusivity costs money I guess.


My best

Jaco you forgot the price of advertising (SCI) (DSC) ETC......

 

[thi9elsp]

Seems like this statement from the thread on the million $'s buffalo sale says it all:

Horizon’s sale bucks the recent trend for wild animal prices in South Africa. Average buffalo prices, including females, dropped 30 percent to 334,879 rand in 2015, according to data compiled by South Africa’s North West University. Prices of sable and roan, both types of antelope, dropped 35 percent and 39 percent respectively.

Supply and demand. Too much supply, lower prices.

 

[KWALATA SAFARIS]

Jaco, seems that if someone doesn't agree with you they either an idiot and don't know how to run a business. I am in a far more remote area than you, I know the exact fuel costs. 2015 $ to metica(31), at the moment the dollar to metica is sitting at 48. At the moment fuel is costing 38 mets a liter. How is for example your leopard different(product) from many other guys product?

Simon
I have had 100% success in 6 years, I burn a liter of fuel per kilometer, per boat, I run generators almost 24/7 that makes a camp convenient for clients as far as remote come try Nhenda and work the logistics, I have no animosity towards you so enjoy your ride, my costs are as real as yours,
My leopard are mid range many companies sell $30 - $36k

On the run buisiness part I am purely giving what you and actions been dishing out, it's a stupid thread what [edited by Africahunting.com] are you doing here anyway.

My best always

 

[siml]

The reason I am on here because you put it on an open forum, and I disagree with your facts. 100% success on what?