By Mohsin Tutla
What are the challenges facing Umrah and #Hajj companies abroad especially in the wake of the pandemic?
Prior to COVID 19, the Hajj and Umrah Industry’s deliverance was recognisably achieved through the contribution of more than 50,000 Pilgrimage Sector professionals; facilitating the participation of 2.4 million Hajj Pilgrims and 18 million Umrah pilgrimages, consistently for the preceding three years. The economics of the pilgrimages was made possible through transactions estimated at 16 billion USD, a lifeline that upheld the aspirations and services required to satisfy the needs of the millions of Muslims visiting Saudi Arabia for this purpose.
Comparing and contrasting the industry circumstances and sector attitudes prior to COVID 19 and within this pandemic period can be summed up with “Optimism substituted with Pessimism”.
Over the past 18 months, both underlying challenges and surface level challenges faced by an industry already struggling to survive within a competitive environment have converged and amalgamated. The structural weaknesses in business processes and practices have been exposed through the COVID 19 pandemic, highlighting how fragile the Hajj and Umrah eco-system actually is, and its strength to with stand and re-invent itself under such difficult conditions.
There is a myriad of challenges that have crippled the industry’s capabilities to both rejuvenate and to achieve form. The sequential dismantling of international Hajj and Umrah companies’ performance capabilities is a result of the lack of information, strategic leadership both at home and from #Saudi Arabia and the organisations inert inability to self-determine the best course of action to safeguard their finances and resources.
Dissecting the key challenges faced by Umrah and Hajj companies abroad, can be narrowed to a single point, “Breach of Confidence” across the full width and breadth of the #Hajj and #Umrah and supporting travel sector eco-system, otherwise known as the Hajj and Umrah Universe. A breakdown of communication between the Saudi Ministry of Hajj and Umrah and the International Hajj and Umrah Sector, has caused paralysis. Hajj and Umrah companies over the decades working with Saudi Arabian counterparts had perfected the art of meeting the requirements of regulations issued by Saudi Arabia and by their own governments, when preparing for the pilgrimage, this seamless synchronisation has been disrupted by the Pandemic.
But what I would much rather focus on is what is transpiring beneath the radar, which is the paradigm shift into a new era. It has already happened before our eyes, this year, and it has largely gone un-noticed. For the first time in modern history, this generation is in witness of the birth, implementation and transition from the advancements of the 3rd industrial revolution to the 4th industrial revolution. “Hajj 4IR” was adopted in order for Hajj 1442/ 2021 to take place, converging IoT and AI, as well as converging the physical, digital and biological worlds together to make Hajj possible for 60,000 pilgrims this year.
COVID 19 has focused the priority on Health and Safety, as the principal adjudicator on decisions pertaining to the merit and feasibility of the Hajj and Umrah pilgrimages. This shift has recalibrated the landscape on how Hajj and Umrah is planned and how the services are to be provided. Where the international community was listening to the directions of the Ministry of Hajj and Umrah, they began to monitor the inclinations of the Saudi Ministry of Health.
Coming into contact with such unfamiliar territory, has led for companies unable to plan as normal and not having an understanding what is the new normal. Creating an unwillingness and a loss of appetite for risk. When you weigh the probability of making a profit against the probability of making a loss, whilst being held accountable to the ensuring pilgrim health and safety, the probability is against international Hajj and Umrah companies.
A Summary of Key Challenges
- International Hajj and Umrah businesses unable to create a viable and sustainable business plan and model to undertake pilgrim travel services under pandemic conditions.
- More than 30% of all Hajj and Umrah Companies have seized trading or file for bankruptcy worldwide.
- Start-Up capital has depleted, with a majority of companies currently operating under debt.
- Startling reports connected with the risk and high risk of costs, has curtailed the demand for pilgrimage travel. The rise in disposable income underpinned the growth of the Hajj and Umrah sector, which has over the 18 months has starkly depleted.
- The risk of selling packages without guarantees and assurances has set insecurities within the hearts of decisions makers.
- The rate of expediency of digital transformation and uptake of technology to book and facilitate pilgrimages, replaces traditional sale and service acquisition processes.
- A service base industry has lost experienced and trained Human Resources to other industries and businesses were unable to retain experienced staff.
– How high is the demand and will this move be a start to the recovery of the sector abroad?
Pilgrimage is the cornerstone of every Muslim’s heart. The desire to visit the holy cities of Makkah and Madinah and to uphold the traditions of the Hajj and Umrah will withstand any calamity, even a pandemic.
The demand for performing Hajj and Umrah is not based on economic factors but it is affected by it. Observance of religious etiquettes which includes the preservation of life and health and the uncertainty of how the pilgrimages will be facilitates has a direct correlative impact on the willingness of the pilgrim to travel for Hajj and Umrah pilgrimages.
COVID 19 financial implication have not spared anyone, except industries focused on social distance technologies and health preservation sectors. A recent poll undertaken by the Hajj People – Knowledge Division from London, suggested the demand is not as high as industry protagonists may think. Even if a pilgrim was able and willing to go, he may not be able to travel for pilgrimage for not having met the basic requirements of pre-travel COVID 19 vaccinations or risk of testing COVID 19 positive when PCR tested.
Over the past three decades, there has been significant financial growth amongst Muslim communities worldwide, creating a larger middle-income bracket, with larger sets of disposable income. COVID 19 has significantly impacted middle-income families, who are forced to be more concerned with immediate and future financial commitments amidst uncertainty. Making pilgrimage possible for three categories of the population, the wealthy elite, thrifty committed savers and the impassioned faithful Muslim, desirous of performing the Hajj or Umrah pilgrimage.
You will find that globally pilgrimage demand through force of circumstance would have dropped by approximately 40% for International Umrah and 15% for International Hajj Pilgrimage.
However, the future is not bleak, rather I am extremely optimistic. The COVID 19 pandemic has forced efficiency and the introduction of technology and transparency to hold precedence. This will translate into cheaper and more service driven industry focused on pilgrim enrichment.
The World Hajj and Umrah Care Foundation working alongside more than 200 institutions and partners are currently introducing new safety mechanism through the implementation of the Hajj and Umrah Safe Corridor programme. Over the past 9 months new methods the WHUC Foundation has been working install the mechanism in 25 countries Worldwide. A monumentous effort to help rejuvenate the recovery process of the Hajj and Umrah sector. Developing new initiatives to educate and re-train industry professionals, developing packages suitable for pandemic pilgrimages and introducing vigilance technologies to preserve high standards of health protocols.
Mohsin Tutla is the Chairman of the World Hajj and Umrah Care Foundation
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