Changing Market Poses Challenge for Top Resort
Since Roman troops pitched their tents here in the first century, the hot springs of Vrnjačka Banja have attracted generations of road-weary travelers. By modern times, Vrnjačka Banja had become one of Serbia’s best known spas. The five thermal springs set in the postcard-perfect Morava River Valley drew thousands of visitors annually from all over Yugoslavia and abroad. But in the past few decades, the spa had lost a bit of its luster. Lack of investment and little in the way of promotion threatened jobs and growth in a town heavily dependent on tourism.
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| Since 2004, USAID has helped Vrnjacka Banja spa managers and tourism officials to plan the spa’s development, which has led to increased revenues from foreign visitors |
Working with the National Tourism Organization of Serbia and local businesses, USAID’s Enterprise Development project conducted market researched that showed strong potential for the area. There was just one problem: international visitors said that they loved the scenery and hot springs, but weren’t as enamored with the state of the facilities or level of service offered. And, with other countries working to promote their own spa tourism trade, Vrnjačka Banja found itself facing stiffer competition for tourists’ euros. With this information confirming what the spa managers had already suspected, they embarked on a plan to win their clients back.
USAID helped these managers to see for themselves how successful spas in the European Union (EU) operate, introducing them to model businesses in Italy and Slovenia. To improve services, staff members were trained in hotel and restaurant customer relations. The project also helped officials develop new signage for improved walking routes. Even the city center got a fresh coat of paint. And to promote the destination, specialists in international travel branding worked with local businesses to develop new guides, maps, and web sites.
Travelers responded positively. In 2006, international stays increased by 59 percent, bringing the total number of visitors to 150,000. Spending was up by $5.3 million. Today, the historic promenade is alive with guests from Russia, Israel, Cyprus, Germany, and France, as Vrnjačka Banja enjoys its best season in 15 years.
Local tourism director Milomir Perović is pleased with the improvements and repositioning of the resort. “Vrnjačka Banja is attractive to tourists again, this time around for vacation and recreation, rather than as a health care site,” he noted.
The Vrnjačka Banja activity is just one element of USAID’s Enterprise Development project, which aims to help Serbia and its companies to fully integrate into higher value markets by raising standards and promoting their many assets. Total sector growth in areas that the Project has been working over the past three years is $350 million, with tourism revenues up 100 percent ($183 million). Pharmaceutical research companies investing in Serbia have risen eight-fold from three to 24, driving estimated growth from $6 million to over $25 million. Fruit juice exports are up $23 million—a gain of more than 200 percent. Apparel exports are up $100 million, representing growth of 80 percent.
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