VisitScotland: Helping tourism SMEs internationalise through ERDF CALANAIS STANDING STONES, ISLE OF LEWIS VisitScotland: Helping tourism SMEs internationalise through ERDF Good afternoon ladies and gentleman. It is a pleasure to be here today to share Scotland’s experience of using European funding to support growth and jobs through tourism. My name is Jonathan Pryce and I am Director of the Tourism and Culture department at the Scottish Government, which funds VisitScotland, the national tourism organisation. VisitScotland has successfully identified a challenge facing our tourism industry and is now implementing, thanks to ERDF funding, a whole programme of activity aimed at helping tourism SMEs internationalise. The impact of this activity will strengthen Scotland’s ability to deliver long-term tourism growth.

VALUE OF SCOTTISH TOURISM TO THE ECONOMY €13bn VALUE OF SCOTTISH TOURISM TO THE ECONOMY 17% - PROPORTIONAL OF OVERNIGHT VISITS TO SCOTLAND BY INTERNATIONAL VISITORS 38% - PROPORTION OF TOTAL TOURISM INCOME FROM INTERNATIONAL VISITORS THE CHALLENGE: TOURISM SMES UNABLE TO ENGAGE The Scottish context – what opportunity are we reaching through ERDF funding? In Scotland, we talk not just about tourism but the visitor economy, and how important this economy is for the health of the nation. Scottish tourism is a key economic driver, generating €13bn annually for the nation. It touches every part of the economy, from retail and the creative industries to food and drink. Perhaps surprisingly, international markets – both Europe and worldwide - account for only 17% of all overnight trips to Scotland. However, a much more significant 38% of tourism income comes from these same international visitors, demonstrating the importance of this group for longer term sustainable economic growth through tourism. In line with EU thinking on the potential of overseas markets, VisitScotland and the Scottish Government recognise that a greater focus on international visitors is fundamental to delivery sustainable economic growth. As the national tourism organisation, VisitScotland markets effectively to international visitors. The challenge we face in Scotland, however, is that tourism SMEs, post-recession, lack the financial resources, the market knowledge and the confidence to take advantage of these trends…It’s cheaper and easier for them to target existing customers in the short term rather than develop a new, more sustainable focus on international prospects. It is also the case that the tourism industry in Scotland is heavily dominated by the Small rather than Medium sized enterprises. This led VisitScotland and the Scottish Government to consider and identify relevant EU funding opportunities that would help us bridge this gap – in this case, ERDF funding and its thematic concentration of Support for SMEs. THE OPPORTUNITY

SCOTTISH DEVELOPMENT INTERNATIONAL ROYAL EDINBURGH MILITARY TATTOO €13.7m ERDF FUNDING 1 AUGUST 2015 – 31 DECEMBER 2016 Key partners: SCOTTISH ENTERPRISE SCOTTISH DEVELOPMENT INTERNATIONAL HIGHLANDS & ISLANDS ENTERPRISE So what’s happening? How do we intend to use the funding and who are the stakeholders involved? The funding will be used to deliver a programme of Internationalisation activity that will support SMEs all over Scotland, including in rural areas, attract more visitors and income from overseas markets. This will, longer term, help Scotland become a more economically sustainable tourism destination. VisitScotland has applied for €13.7m of ERDF funding to deliver this programme of activity between 1st August 2015 and 31st December 2018 As the national tourism organisation, VisitScotland is the delivery partner for this Internationalisation Programme, working closely in partnership with Scotland’s enterprise agencies: Scottish Enterprise, Scottish Development International (the inward investment body), and Highlands & Islands Enterprise (the regional enterprise body for the most rural and remote parts of Scotland). SO WHAT’S HAPPENING?

HELPING TOURISM SMEs BUILD CAPACITY WITH INTERNATIONAL MARKETS. OPPORTUNITIES INCLUDING: BUSINESS TO CONSUMER SUPPORT BUSINESS TO BUSINESS SUPPORT CALLANISH STONES WHAT DO WE AIM TO ACHIEVE? What do we aim to achieve? ERDF funding will extend the scale and scope of VisitScotland’s activity to provide new elements to help tourism SMEs build capacity with international markets for longer term growth. In summary, the activity provides tourism SMEs with opportunities including:    Business to consumer support – providing SMES with direct routes to international consumer markets through digital platforms and marketing campaigns. Business to business support: providing SMEs with direct engagement with the travel trade at the annual VisitScotland travel trade show, Expo, which attracts 600 UK and international buyers and tour operators each year; and the opportunity to participate in trade and business development missions and events, which are key platforms for tourism SMEs keen to break into international markets.

Enhanced access to international consumer markets through: new digital platforms new consumer marketing campaigns overseas Connecting SMEs with international trade opportunities: creating an online catalogue promoting international trade development events Delivering access to with international trade shows and events Funding, education and skills for SMEs: A funding programme for SMEs attending 10 trade development events New introductory awareness and engagement workshops for SMEs International Destination Awareness Programme for International Tour Operators So what does this programme of internationalisation activity look like? ERDF funding will extend the scale and scope of activity by VisitScotland and its partners to provide new elements that will help SMEs build capacity in international markets for longer-term growth. Just some of this activity - some of which involves true partnership activity with and support from the enterprise agency partners – I would like to outline here: Enhanced access to international consumer markets through new digital platforms New consumer marketing campaigns overseas to drive consumers to these platforms Development of an online catalogue promoting international trade development events to tourism SMEs Delivery of 120 businesses to trade shows and development missions internationally Access to 6 new international trade development events in Europe, the Middle East and Australasia Development of a funding programme for SMEs attending 10 trade development and promotional events Development and delivery of new introductory workshops for SMEs to maximise their engagement in trade events Development of  an International Destination Awareness Programme for International Tour Operators WHAT DOES THIS PROGRAMME OF ACTIVITY LOOK LIKE?

450 new tourism SMEs with a visitscotland.com web listing 260 tourism SMEs participating in international trade exhibitions and events What are the targets and anticipated added value of this work? VisitScotland and the Scottish Government have agreed a number of targets that will be delivered for the EU grant and the grant will be paid when VisitScotland has provided evidence that it has achieved these targets.  Two key targets include: -          450 new SMEs with a web listing -          260 SMEs taking part in Expo , Golf, International and business trade missions A further €7m for an further two years of the Funding Programme (for 2019-2020) will be dependent on Scotland achieving targets and audit and compliance performance up to 2018. While it is of course too early to confirm these targets have been met, there has been significant progress across the Internationalisation Programme and we are well on our way to achieving our goals of delivering enhanced support for tourism SMEs looking to tap into international markets. Long term, this will enhance the competitiveness of tourism SMEs and support their capacity to grow in regional, national and international markets. TARGETS

The royal edinburgh military tattoo FORTH BRIDGE Thank you THANK YOU Ladies and gentleman, I know I am preaching to the converted when I say that tourism – the visitor economy – is crucial to sustainable growth and jobs. I hope that our example of how Scotland is effectively implementing ERDF funding for the benefit of tourism SMEs and a more sustainable visitor economy encourages delegates here today. It is our experience that, while the opportunities for tourism related EU funding opportunities were limited, the added value of this funding is very worthwhile – and can effectively support the future tourism potential of SMEs in Scotland. Thank you.