Original Cruise Inc. Big Money on the high seas
CNBC aired in 2009 a special program about the business of the cruises industry. The industry is concentrated in three big players: Carnival, Royal Caribbean, and Norwegian. The Report (CNBC) was using the study case of Norwegian with the collaboration of the Chief Financial Officer of Norwegian. The first goal of the cruise company's managers is to fill up the ship before set sail. According to the interview, the most important part of the business is not by the ticket selling of cabins before the ship set sail but after the ship set sail. There are related businesses with the cruise industry, apart from the ticket selling. Casinos, Food Specialties, Health Services and goods offered on the ship by third parties gives a benefit to the cruise operators with a fee near 20% of total sales. The shows and the availability of free liquor inside the ships increase the ability of the clients to expend inside and outside the ship. The costs of the ship operations vary according to of the ship flag. A ship with United States of America flag may generate costs over 100 million dollars to a ship with a flag of Panama or Bahamas. The use of a multinational labor force helps the company to reduce costs and increase revenues. The other part of the cruise business is the stops along the passage. In the showed case Honduras, Belize, and Mexico are the fixed stops that every week the ship stops boosting the tourism industry in those destinations. According to the Tourism Authority of Honduras, they don't want the ship to leave the coast because the influx of tourist is the most important income generator of the region. To finish the investigation, the cruise industry is not exempt from security and accident issues. The companies must have security staff and resources to attend those hazardous situations.
Works Cited
CNBC Original Cruise Inc Big Money On The High Seas. Dir. Mitch Weitzner. CNBC. 2009.
