South Africa Rand Is Crashing

[Reaper]

The question really is will an outfitter adjust their dollar price for a hunt to reflect the current weakness of the rand. Many have, which is why you see the recent deals many of which specifically call out the exchange rate as the reason for the deal, some have not.



What currency is used at the point the deal is struck is really irrelevant if you think about it. Would the above deal be less expensive today if the same outfitter charged $500 instead of whatever rand price he charges that you converted to $500?

Edit: if my post came across as snotty that wasn't the intention, kind of sounded that way when I read again. My point is that we all somethings think we get a better deal because of the currency itself, when those prices could be just as easily adjusted.

Regarding your first point; are we really seeing that many deals? I have been following the prices on PG hunts in SA for a few years, it seems that most of the common PG species (Oryx, Zebra, Kudu, BWB) have always hovered around the $1000 mark (give or take 20% depending on species)

Regarding your second point, you're right it doesn't matter which currency is used. However due to the exchange rate, that Kudu would have cost you almost $900USD two years ago. Now due to the collapse of the currency you're getting it at $500, and the outfitter is still making the same profit as before in Rand.

P.S.
No worries - Didn't sound snotty at all.

 

[Royal27]

Also, since they are pricing in a foreign currency they are exposing themselves to exchange rate risks

To my earlier point though

g. If it goes from the current 16/1 to 20/1 then awesome. If it goes to 10/1, then oops....

Foreign exchange risk IS there no matter what. It is a matter of who takes it and how.

Unfortunately, due to outfitters charging in USD they are keeping the profits for themselves, instead of passing the saving on to their clients.

Now to me this is the most interesting point of the entire exchange rate discussion and where supply and demand comes in as well. Assuming I booked a hunt a year ago when the rand was 11/1 I don't begrudge any outfitter for "pocketing the profits" and I promise you that if the rate had gone the other way and was at 7/1 now I wouldn't be telling the outfitter I need to pay them more because I had profitted!!!!

Here is where supply and demand comes in. Lets assume I didn't book last year and I'm booking today for this year. As a smart consumer I know my dollar is worth more, so I expect more. If an outfitter won't give me more then my "demand" drops because there are other outfitters who HAVE lowered price for the same product.

 

[Reaper]

You also make some good points. Yes, forex is a double edged sword.

Foreign exchange risk IS there no matter what. It is a matter of who takes it and how.



Now to me this is the most interesting point of the entire exchange rate discussion and where supply and demand comes in as well. Assuming I booked a hunt a year ago when the rand was 11/1 I don't begrudge any outfitter for "pocketing the profits" and I promise you that if the rate had gone the other way and was at 7/1 now I wouldn't be telling the outfitter I need to pay them more because I had profitted!!!!

Understood. But I wonder if you would not be getting a call from the outfitter moaning about how the exchange rate went south and he needs to raise the price. I actually think I've seen in the disclaimer on some outfitter site's about prices being subject to change due to forex fluctuations.

Here is where supply and demand comes in. Lets assume I didn't book last year and I'm booking today for this year. As a smart consumer I know my dollar is worth more, so I expect more. If an outfitter won't give me more then my "demand" drops because there are other outfitters who HAVE lowered price for the same product.

See my earlier point asking if we are really seeing saving reflecting the drop in the rand.

 

[ActionBob]

If you lived in a country which had a currency that fluctuated like a toilet bowl, would you charge foreign hunters in Rand?

Please let me know when you convince anyone to operate in RAND that makes a business offer outside the country.
Why would they take the risk?

My wife and I are hunting this year with a outfitter who is charging in rand. At the end of our hunt we will look up the Forex rate and pay accordingly with US

Although i fully understand outfitters wanting to make the most they can and charging in USD not only makes a lot of cents, right now it makes one heck of a lot of Rands! More power to them if they can do it. as long as they don't try to tell us how terrible it is with bogus math

However @BRICKBURN how would the scenario such as @jeff layed out be a risk to an outfitter or anyone else doing business in RSA?

It seems to me that is the safest and perhaps even the fairest way to go because you get settled up at the current exchange rate at the time you receive the funds. Of course I'm sure many hunters on here want or even need the security of knowing their total budget in their home country currency when they book the trip. However I for one could easily be interested in assuming the potential risk as well as reward of taking my chances on the FOREX. I'm not surprised to hear of some outfitters offering this, it makes a lot of financial sense for them to mitigate their risk this way... Essentially what I see most outfits doing is trying to get as close to the same dollars as they have last year or the past couple years... Understandable, I just find it irritating, to a point, when they try to play it off as some kind of sacrifice on their part, when reality is they are getting more of their local currency. However, many are adjusting and being fair about it...

I think good old Capitalism is alive and well in the hunting industry and eventually the best operators and fairest deals rise to the top. One golden rule of true Capitalism is that in the end, the consumer wins!

 

[siml]

Reaper,I just had to do 2 quotes for 2 company groups, I am shocked at the price increase of the landowners. It's not the outfitter that is making all the money from the weak rand. I was paying R8000 last year for kudu, this year R12000.

 

[Royal27]

Regarding your second point, you're right it doesn't matter which currency is used. However due to the exchange rate, that Kudu would have cost you almost $900USD two years ago. Now due to the collapse of the currency you're getting it at $500, and the outfitter is still making the same profit as before in Rand.

Agree that revenue has gone up to the outfitter no doubt nor dispute. And because of this I do think the deals are there. Maybe you have to look for them, but they are there. Heck, you found one with the $500 kudu!

Although i fully understand outfitters wanting to make the most they can and charging in USD not only makes a lot of cents, right now it makes one heck of a lot of Rands! More power to them if they can do it. as long as they don't try to tell us how terrible it is with bogus math

Bob makes a great point. If a business can pocket extra profit, more power to them. But they shouldn't think that I'm not going to try and do the same thing as a consumer.

 

[LivingTheDream]

I honestly am not sure how much the exchange rate really matters. The Canadian Dollar has been falling against the dollar for sometime (not as quickly as the Rand). Those outfitters charge in USD and since there is a limited number of permits as well however due to demand their prices have continued to go up.

So I do agree there will be some deal making going on over the falling Rand however I would not expect them to post these prices as in the event the Rand gains strength they could really be hurting themselves in the long run. For example a customer looks today and sees a Kudu for 900 and then 6 months later it is 1200, obviously the client will be upset.

I say this as a client, I obviously will try to work for a deal but I would not put the currency exchange as part of my negotiations, because if it changed the other way I would be super PO if they came back to me and said pay more the prices went up because the Rand gained strength. Its a slipper slope for both the outfitters, PHs and clients.

 

[ActionBob]

I honestly am not sure how much the exchange rate really matters. The Canadian Dollar has been falling against the dollar for sometime (not as quickly as the Rand). Those outfitters charge in USD and since there is a limited number of permits as well however due to demand their prices have continued to go up.

You may be correct on the real high demand stuff? However I met a couple Canadian outfitters selling black bear hunts in CAD and they went out of their way to point out what a good deal it is when converted from USD... So some are adjusting!

Of course for the stuff that is booked out a couple years, they don't need to. Capitalism.

 

[LivingTheDream]

You may be correct on the real high demand stuff? However I met a couple Canadian outfitters selling black bear hunts in CAD and they went out of their way to point out what a good deal it is when converted from USD... So some are adjusting!

Of course for the stuff that is booked out a couple years, they don't need to. Capitalism.

Yeah I was mostly focusing on the price of sheep hunts, mountain caribou, and grizzly, they are going up quicker then I can save regardless of the exchange rate. I have seen black bear hunts coming down or "last minute specials" but as you said that is capitalism!

 

[PHOENIX PHIL]

This thread is interesting for a number of reasons. A few more thoughts after popping in and out today reading it.

Not sure how anyone can think there haven't been a number of deals offered in response to the dollar/rand that in my mind are pretty amazing. A couple years ago a buff hunt in RSA, we're talking $15K typically, perhaps more. Now we're seeing $8-9K.

RSA pricing hunts in Rand is certainly one way outfitters can do things. So lets say you came to the HartzView booth at DSC or SCI this year. I price you a kudu hunt with a trophy fee of 30,000 Rand. Assuming a dollar/rand conversion of 15R/$1, that would equate to $2000. You agree to trophy fee and daily rates and sign a contract to hunt in 2017 based on the prices in Rand. So next year comes and the Rand has dropped further to 30R / $1. Hey, winner winner, now that Kudu is costing you $1000. Or next year comes and the Rand has gone the other way, it's now 7.5R / $1. Now that Kudu is costing you $4000, are you going to be okay with that?

My point is that if the hunts are priced in dollars, no matter which way the dollar/rand goes, the price is in dollars and does not change one way or the other. As such there is stability on the consumer's side and thus no nasty surprises......and yes of course no pleasant ones either. But I do believe there is something to be said for that stability, versus wild gyrations like we'd be seeing with the weakening Rand now, nor a potential strengthening in the future.

Back to my example above. Let's say you booked a hunt in RSA while at DSC in January this year for a hunt in July, 2017. Most outfitters I know will book that hunt at this years prices and hold them till your hunt a year and a half later. How many products can a person buy in this world where they put a relatively small deposit down, and take delivery of that product a year and a half later at the price originally agreed upon? I can't think of any. The only thing that comes close in my opinion is building a new home that takes typically 6-8 months. I think this is something that needs to be taken into consideration in this topic.

 

[LivingTheDream]

@PHOENIX PHIL I agree with your example completely. It is always great when the exchange rate is going in your direction. To me if I book at hunt at 5000 it is of good value to me regardless of the what the Rand, Euro, Can does and I am not going to be playing the FOREX game.

To your point about buffalo, I feel like this attributed more to outfitters not being able to advertise Lion hunts and can't sell Leopard hunts and they need a big ticket item. I believe in SA Dangerous Game PHs need to hunt DG 60 days of the year to keep their license so this is probably put added pressure to sell buffalo hunts as well.

 

[enysse]

I think everyone adjusts prices based on how many hunts they sell. If they sell a lot of hunts prices must be fair, if not a re=evaluation is done. I would expect no landowner with animals to hunt to be selling any less than any other year. Fair or not, it doesn't matter. The customer makes a final choice based on what is good for him or her. Some choices are made just because people like the outfitter or the trophy quality the outfitter offers or the animals available to hunt in that location. Some customers wait on the sideline and wait for a deal solely based on price, where others are picky (that would be me). Some people have all the time in the world to hunt and for others time is money (they don't have enough time off). Everything in life is a compromise.
One last word off advice, be carefully of pissing of the person you are looking to hunt with before the hunt even starts. The last thing you want to do is wreck the vacation before it starts. Negotiating prices is fine, but remember hunting is a business for the people you go to and you don't want to leave the well dry.

 

[dory]

This is a topic I still need to get my head around to understand the concept...as a South African biltong hunter I was astonished to noticed a South African outfitter placing costs of a hunt in Zimbabwe where an Impala ( the biltong hunter`s bread and butter game ) that cost me about R900- R1000 costing a whopping $700 ( converted to our Rand currency totals to R11300, 55 ...the only reason I can think off is that Greed in capital letters /short cut to riches may be the rationale ....or motivation to ask such unrealistic prices...or it may be that I am missing something some where....

Looking at this scenario, we do not need to fear the Greenies to succeed in getting it right to put a total ban on hunting ...no, no it will be the outfitters /game farms who will ensure that a normal average citizen will financially not be able to hunt anymore...every thing has it`s price...there is a limit to what hunters will feel comfortable with to pay for game..that limit is being reached according to many hunters I know..few of my friends will be hunting this year and next year....due to this scenario...

Its a bloody shame you have to pay to hunt in your own back yard .
It is free here in New Zealand and we take it for granted !!

 

[Gert Odendaal]

Members
It seems this is a controversial issue. My difficulty regarding this issue is as follows:
As I mentioned ..the specific South African outfitter who catered for the hunt in Zimbabwe just changed his South African biltong price for an Impala going for R700( I presume it is for an ewe) to $700 ...I do not think it is a question of other charges being taken in account , just a matter of substituting the R symbol for the $ symbol..the difference being this impala`s price is taking a hike up to R11,300, 55 which is a pretty steep price for me as a biltong hunter ....
I need to point out, I do not criticize any outfitter...it is just something that attracted my attention..a while ago...it therefore does not have an influence on me as a biltong hunter( except the crazy day tariffs for us , South African biltong hunter( a person hunting twice a year for venison) since day tariffs are R460 pp/pd , observer ( wife/child) R410 pp/pd..this definitely has an effect on my financial side...

Regards

Gert

 

[dory]

Members
It seems this is a controversial issue. My difficulty regarding this issue is as follows:
As I mentioned ..the specific South African outfitter who catered for the hunt in Zimbabwe just changed his South African biltong price for an Impala going for R700( I presume it is for an ewe) to $700 ...I do not think it is a question of other charges being taken in account , just a matter of substituting the R symbol for the $ symbol..the difference being this impala`s price is taking a hike up to R11,300, 55 which is a pretty steep price for me as a biltong hunter ....
I need to point out, I do not criticize any outfitter...it is just something that attracted my attention..a while ago...it therefore does not have an influence on me as a biltong hunter( except the crazy day tariffs for us , South African biltong hunter( a person hunting twice a year for venison) since day tariffs are R460 pp/pd , observer ( wife/child) R410 pp/pd..this definitely has an effect on my financial side...

Regards

Gert

That sucks !!!
Come to NZ buddy you can shoot as much venison as you want , no charge !

 

[Gert Odendaal]

Hallo Dory
I might just do that some day..my brother in law is living in Auckland, a very good friend of mine known as Von Gruff( on forums) is living in New Zealand as well..an extremely accomplished rifle builder and hunter...who knows maybe I will get to your back yard and hunt with you in the future...

I should have pointed out that there are options for us biltong hunters , especially when finding a cattle farm where game is abundant ..you get much better day fees and game prices this way...it is a much nicer type of hunt as well..the real nice option is then to camp in the bush around a camp fire , listening to the night sounds and animals move around your tent/where you sleep along side the fire.....

 

[PHOENIX PHIL]

@PHOENIX PHIL I agree with your example completely. It is always great when the exchange rate is going in your direction. To me if I book at hunt at 5000 it is of good value to me regardless of the what the Rand, Euro, Can does and I am not going to be playing the FOREX game.

To your point about buffalo, I feel like this attributed more to outfitters not being able to advertise Lion hunts and can't sell Leopard hunts and they need a big ticket item. I believe in SA Dangerous Game PHs need to hunt DG 60 days of the year to keep their license so this is probably put added pressure to sell buffalo hunts as well.

The loss of lion hunts is probably having an effect too. But I know some of the outfitters who booked lion hunts in RSA did not actually conduct the hunts as they did not have the license to do so. Still they're also discounting hunts.

The loss of leopard hunting in RSA this year I don't think has much impact. There were very few permits issued in RSA in the first place.

 

[gillettehunter]

I would suggest that if a hunter is negotiating for a hunt partially because of the rand/dollar price to put up a larger deposit. Say offer 75% of the total price for a reduction. That way the outfitter has less risk. Buy some trip insurance and make a plan. Is the drouth still going on in RSA? I had heard that it was. If so then there may need to be a few extra animals taken off. Perhaps some prices reflect that need also.
With gas/oil prices where they are it is keeping. Haunting segment of the population home too. Should be a good year for "deals". Bruce

 

[lcq]

If you lived in a country which had a currency that fluctuated like water in a toilet bowl, would you charge foreign hunters in Rand?

The Rand is fluctuating, some would say circling the bowl because of the incompetence and corruption of the Zuma dictatorship for life. We in Canada are about to get a taste of what that is like under Prime Minister Selfie and his merry band of socialists.

 

[enysse]

I would suggest that if a hunter is negotiating for a hunt partially because of the rand/dollar price to put up a larger deposit. Say offer 75% of the total price for a reduction. That way the outfitter has less risk. Buy some trip insurance and make a plan. Is the drouth still going on in RSA? I had heard that it was. If so then there may need to be a few extra animals taken off. Perhaps some prices reflect that need also.
With gas/oil prices where they are it is keeping. Haunting segment of the population home too. Should be a good year for "deals". Bruce

I agree put up a big deposit, that insulates the outfitter, secures a better price.

The oil price benefits certain people, like me right now.......I'm happy were it is.