It’s Time to Join the All-Inclusive Party, Hawaii

Travel Agent's Joe Pike thinks all-inclusive resorts will help Hawaii compete with Mexico and the Caribbean.

Enough of the excuses, Hawaii. It’s time to join the all-inclusive era if you want to compete with comparable warm weather destinations like Mexico and the Caribbean, two competitors that are clearly ahead of the curve when it comes to delivering top-notch all-inclusive service.

Over my years of covering the Aloha State, I’ve heard many all-inclusive companies express interest in an expansion to Hawaii, with the latest coming from AMResorts. Back in January, we reported that Gonzalo del Peon, president of AMResorts, confirmed rumors Travel Agent had been hearing for quite some time of a possible AMResorts expansion to the Aloha State.

"Hawaii is definitely a location we have been pursuing," Peon told Travel Agent at the time. "We would really like to bring our all-inclusive product there, but I wouldn't say it is a top priority at this point.”

We should also note that AMResorts told us something very similar about eight years ago and nothing came to fruition.

I’ve heard all the reasons from Hawaii tourism experts on why all-inclusives would not be a good fit for the Hawaiian Islands, whether it’s labor costs or the fear that clients won’t dine around. 

And now I will give my thoughts on why those excuses simply won’t cut it anymore. 

Labor Costs

So if all-inclusives are such big draws, why don’t we see more of them in the U.S.? All the industry professionals I previously interviewed point to one reason: labor costs.

I spoke to all-inclusive experts in the past who told me that, for U.S. workers, there is a minimum wage, and service positions depend heavily on tips. Neither of those happen in a non-U.S. all-inclusive. When you couple that with the fact that some of the major all-inclusives employ as many as 3,000 workers, if not more, you can see how the expenses can add up. So, what's the big deal with allowing tips to make up for this? Sure, clients at all-inclusives don't want to carry cash around, but what about billing tips to the room? Seems like an easy fix to me. 

And 3,000 or more employees are usually needed for the monster resorts with 1,000+ rooms. Why wouldn't a smaller, boutique-style all-inclsuive with only a hundred or so employees work?

But for most Caribbean and Mexico companies, the product just wouldn't be the same if it was located in the U.S., as all-inclusive resorts tend to blend with the unique characteristics of their surroundings. But I argue that this would not be a problem for Hawaii, as it is unlike any other American state, offering enough exotic culture to make a guest feel like he or she is in another country. 

The cost of flying to Hawaii will always be high. That’s a simple fact that many vacationers need to get used to. To level off those high airfares, many hotels offer value packages that include resort credits, airfare credits or even a spa credit, but the value of knowing that you will not need to dip into your wallet one time after landing is immeasurable. It’s more of a peace-of-mind value than a monetary one. 

Clients Won’t Dine Around

In my years of covering Hawaii, it almost seems as though the destination prides itself on not offering an all-inclusive product, instead encouraging visitors to the island to dine around the destination’s many impressive farm-to-table restaurants.

This is understandable, but let's face it. The biggest value at an all-inclusive is the alcohol. As long as cocktail-loving clients feel like they got their money’s worth at the bar, they are willing to "waste" a few meals to dine in a new setting.

Now, I will say that this does pose a stronger challenge for couples, but most romantics traveling with their families will want at least one night alone for an intimate dinner. 

But for a family destination like Hawaii, I would argue that many clients are probably wasting food at a non-all-inclusive hotel simply because little Johnny or little Susie doesn't like that the macaroni and cheese isn’t the way mom makes it back home. This is actually one of the greatest values of an all-inclusive in general: kids can return an “icky” meal and get another at no cost. 

Children are fussy eaters in general and become even fussier when they are eating something different or foreign. An all-inclusive resort allows parents the flexibility of finding their children a meal that they will enjoy without breaking the bank to find it. 

And as far as dining, there seems to be a stigma against hotel restaurants in general. A restaurant will get a bad rap simply for being located in the hotel. It is perceived as a lazy adventure of some sort, painting clients as people who don't wish to explore, but would rather sacrifice quality for convenience. 

To this, I say the two best restaurants I have ever eaten at in Hawaii were both located in hotels: Ko, located at The Fairmont Kea Lani, and the Ka’ana Kitchen, located at Andaz Maui at Wailea Resort. Ko showcases the culinary history of the sugarcane plantation era. The menu includes Hawaiian, Chinese, Filipino, Portuguese, Korean and Japanese dishes, many of which are actually island family recipes that have been passed down for generations. At Ka’ana Kitchen, the food is delicious and served tapas style in the sense that the menu lends itself to sharing dishes, although the portions are not small as a traditional tapas style dinner. Both restaurants offer fresh, organic food either grown right there on property or somewhere else locally, as do many others in the Aloha State. You can find the same food if you dine around. 

The Stigma of All-Inclusives

All-inclusives are no longer bargain bins for families on a tight budget. But how we define things is always changing in the travel world. Remember when "luxury" meant only big price tags and a fancy bathroom? Well, luxury is now associated with value. Luxury is not just how much you spend, but how customizable a trip is, how much easier a trip can be. Well, the definition of the all-inclusive has changed just as dramatically. 

During a cover story I did on the evolution of all-inclusives a few years back, I remember Xavier Mufraggi, CEO of Club Med North America, telling us that his clientele has evolved in the past 10 to 15 years to include more families with one or two children and a household income of more than $125,000. 

“While price is still top of mind for everyone, this notion of value has become even more important,” Gordon “Butch” Stewart, chairman of Sandals Resorts International, told us at the time. “Over the years, our consumers have sought more from their vacation experiences—from gourmet dining and exclusive suites to over-the-top luxury features and exceptional service from our butlers. Providing more amenities for our consumers is a personal benchmark we set for ourselves each year.”

In fact, during a recent Mexico roundtable hosted by Travel Agent magazine during the Tianguis Turistico tradeshow in Acapulco this past March, Federico Moreno-Nickerson, director of product development for the Caribbean and Mexico for Classic Vacations, told us the all-inclusive product is one of the main reasons people opt for a Caribbean or Mexico vacation more than a Hawaiian one. 

"Hotels are becoming niche markets," says Moreno-Nickerson. "All-inclusives aren't just free meals anymore. It's not just Kids Clubs, they have toddler programs now too. They are a very complimentary experience, especially with culinary, to the cruisers. The product here has evolved to levels of specialty and sophistication that you've never seen in Mexico."

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