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Weak dollar challenges travelers, import businesses: ACVB courts overseas travelers to see Alaska on the cheap.

Suzi Perri began traveling to Ireland long before she opened the quaint downtown Irish import shop Suzi's Woollies at 420 G Street in Anchorage. Since they opened the shop in 1998, Perri and her husband, Ben Alexander, have traveled to Europe annually to vacation and to purchase sweaters, scarves and woolen hats, silver jewelry and other wares for the shop.

But soaring transportation costs, coupled with the U.S. dollar's shrinking purchasing power, are forcing price increases and the discontinuation of some merchandise, Perri said.

"It's seriously serious right now," she said of the dollar's decline against the euro and British pound.

Perri said she used a simple method to calculate the exchange rate on her trip this spring: "I just doubled everything."

She used the example of the Tavistock Hotel in London where she's rented rooms as a traveler for the past 20 years. The same room that cost her 32 pounds a night when she began using the hotel 20 years ago today sells for 85 pounds a night. That's about $170 U.S., Perri said.

"It's the same room," she said. "It's still a dump."

Whether purchasing a glass of wine, a room for the night or inventory for her shop, Perri said the story is the same for goods and services all across Scotland, Wales, England and Northern Ireland.

The remainder of Ireland uses the euro as currency, which is trading at about 1.5 times the dollar, she said.

That's about where the Irish punt was priced back in 1998 when Perri entered the import business. The euro replaced the punt as Ireland's currency in January 2002. Ten years ago, the British pound was worth about 1.7 times the dollar.

Between the bond the shop must put up to import goods, the duty she pays on those goods, freight, the purchase price and slipping dollar values, Alexander said it's a tough time to be in the import business.

"It'll drive you crazy if you think about it," he said.

Where Gregg Napoli, executive vice president of foreign exchange services for Wells Fargo, lives and works in the San Francisco area, he said he's noticed more and more visitors from the United Kingdom.

"They're carrying lots of shopping bags, too," Napoli said. "America is on sale now for a lot of foreign tourists."


Travel is at record levels, both for Americans visiting abroad and for international travelers visiting the U.S., Napoli said. More than 25 million people are expected to travel to another country this summer; up 2.6 percent from last year's record-setting numbers, he said.

"The appetite for visiting foreign destinations isn't slowing down," Napoli said.

The dollar's value may influence some savvy travelers' choice of destinations, Napoli said. South America and Asian countries offer better exchange rates for the dollar and plenty of Americans are opting to visit, he said. But many travelers are going ahead with their plans for European vacations, Napoli said.

"You can't go to a substitute for Italy," he said. "We may gripe more about the expense of being abroad, but we're still going."

On the flip side, U.S. goods and travel are affordable for international travelers, said Shelly Wozniak, Anchorage Convention and Visitors Bureau's public relation manager.

The marketing organization has increased its leisure travel marketing efforts overseas in the European and Asian markets, she said.

"To ensure Anchorage's top-of-mind awareness with these travelers, ACVB has conducted multiple familiarization missions in Germany, Taiwan, China, Korea, Japan and Canada already this year," Wozniak said.

Wozniak also said they plan to meet with key international tour operators at tourism events in Las Vegas and Vale, Colo."

Anecdotally, she said the group's members are beginning to report an increase in bookings from international travelers.

Napoli said he's noticed that outbound travelers often don't give a lot of thought to foreign currency issues beforehand.

"One of the things we've noticed with outbound travelers is that foreign exchange tends to be the last thing people think about," he said.

He said he suggests people plan to travel with a mix of payment options that include a mix of foreign currency, travelers checks, credit cards, debit and ATM cards.

Wells Fargo provides onsite currency exchange at 16 locations in Alaska, Napoli said.
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Title Annotation:TOURISM
Comment:Weak dollar challenges travelers, import businesses: ACVB courts overseas travelers to see Alaska on the cheap.(TOURISM)
Author:Resz, Heather A.
Publication:Alaska Business Monthly
Date:Jul 1, 2008
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