The division includes three business areas: Kuoni’s tour operators in India, China/Hong Kong and Russia. “Specialists” covers our autonomous European tour operators (outbound specialists) as well as our dedicated local expert companies in the holiday destinations (inbound specialists). The division’s third growth area centres on VFS Global, a company specialising in external administrative visa services.
Kuoni Group defines emerging markets as markets or business models that develop and change quickly, very much driven by innovation. These include the big growth markets of India and China, but also the Russian market, which is characterised by an extremely demanding, highly competitive business environment. The business model developed more than 10 years ago for VFS Global – based on helping governments and embassies manage the whole process of issuing of visas – also comes under this definition. In business terms, these areas are particularly driven by a readiness to take risks, as well as by speed, innovation and the use of the very latest technologies. Investments in these activities tend to focus on IT as well as on acquisitions that can quickly accelerate growth.
Our outbound and inbound specialists are notable for their largely autonomous, highly entrepreneurial management teams. These companies focus heavily on their core destinations and core styles of travel, and they pride themselves on being able to meet the most exacting customer requirements. Kuoni has 17 outbound specialists in Switzerland, the UK and the Netherlands/Belgium. Within these customer markets the companies tend to operate under their own well established and very well known brands. They occupy niche markets and maintain excellent relations with service providers and destinations. Individuality, quality, detailed knowledge and personal service are the hallmarks of the customer advice they provide.
Inbound specialists are local experts with offices in the holiday destinations themselves. Kuoni runs a worldwide network of 6 destination management companies (DMCs). Their local presence and networks provide substantial added value for customers. They employ local people who have great local knowledge, which they pass on both to the guests who arrive from abroad and to our outbound specialists in Europe. Kuoni has thus created a worldwide network of experts that covers the whole process from initial customer contact at home right through to the experiences and encounters facilitated on holiday by the inbound specialists. These inbound specialists tend to operate in the destinations under their own well-known brand names.
VFS Global is one of the most innovative businesses run by Kuoni. The company’s business model centres on helping governments and embassies to process travellers’ visa applications securely and efficiently. Its support work allows authorities to make decisions about issuing visas more quickly and process applications more cost effectively. At the end of 2011 VFS Global had more than 500 Visa Application Centres (VACs) in more than 60 countries, supporting 37 governments.
In 2011, the Emerging Markets & Specialists Division generated turnover of CHF 1 286 million and operating earnings (EBIT) of CHF 69.8 million. Political developments in North Africa and the Middle East, the European debt crisis, the severe earthquake and subsequent tsunami and the nuclear disaster in Japan, but also the strength of the Swiss franc and the sharp devaluation of the Indian rupee against all the main currencies had a major negative effect on the division’s business performance. Nevertheless, several markets and specialists recorded growth, especially in India and Arabia, as well as specialists based in Switzerland and the UK.