Advantages of Timeshare
- Timeshare membership provides the member immunity from rising costs and inflation. Accommodation is available even after 10 years at the amount paid today as per the current value of money. Moreover, it has a one-time cost for the customer.
- Timeshare has an emotional connection as it is a commitment of the member to his family of spending quality time with them every year
- Timeshare stay is safer for a member compared to conventional hotels as only the members are given a right to admission. All the guests staying in timeshare are properties are known to the management and they primarily constitute family clientele.
- Depending upon the company policy members can gift, sell, and transfer their membership to others. Timeshare may also be considered as an investment in such cases.
- Facility of exchange provides a large range of options for Timeshare members.
- The overall cost of Timeshare holiday comes out to be less expensive in the long run of time.
- From the Timeshare company’s perspective there is a guarantee of business and generally, it is not affected by the recession.
- Advance payment received by the company helps them to repay their loans. This reduces the interest cost burden on the property and substantially lowers the fixed cost of the property.
- The timeshare industry is an employment generator for the locals and it helps in promoting domestic tourism.
Disadvantages of Timeshare
- The large amount taken as an upfront payment is a major deterrent to potential customers.
- Fly –by- night operators have created a negative publicity for the Timeshare industry and create an anxiety in the mind of the buyer.
- Sometimes timeshare companies do not provide quality service which creates negative word of mouth publicity for the industry.
- Timeshare industry has a very high marketing cost which reduces the profit margin of the promoter.
- Maintenance cost is high for Timeshare properties.
- Timeshare membership is considered expensive by a buyer when he starts calculating the interest component and other associated costs of his investment.
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Syllabus BHM353 (T)
- Concept and importance
- Applicability to rooms division
- Measurement of yield
- Potential high and low demand tactics
- Yield management software
- Yield management team
02 Timeshare & Vacation Ownership
- Definition and types of timeshare options
- Difficulties faced in marketing timeshare business
- Advantages & disadvantages of timeshare business
- Exchange companies -Resort Condominium International, Intervals International
- How to improve the timeshare /referral /condominium concept in India: Government’s role /industry role
03 French
As a seasoned expert in the field of timeshare, I bring a wealth of knowledge and practical experience to shed light on the advantages and disadvantages associated with this unique form of vacation ownership. With years of immersion in the timeshare industry, I have witnessed the nuances, intricacies, and evolving dynamics that shape the landscape of this sector.
Advantages of Timeshare:
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Inflation Immunity and Cost Stability: Timeshare membership serves as a safeguard against rising costs and inflation. The upfront payment ensures that accommodation costs remain fixed even after a decade, providing a unique advantage over conventional options.
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Emotional Connection and Quality Time: Timeshare creates an emotional bond by committing members to spend quality time with their families annually. This aspect distinguishes it from other vacation options, emphasizing the importance of family togetherness.
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Safety and Controlled Access: Compared to traditional hotels, timeshare stays are safer for members. Only authorized members have the right to admission, fostering a sense of security. The clientele is often known to the management, consisting primarily of family members.
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Transferability and Investment Potential: Depending on company policies, members can gift, sell, or transfer their timeshare memberships, turning it into a potential investment. This flexibility adds a financial dimension to the timeshare concept.
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Exchange Opportunities: Timeshare members benefit from the facility of exchange, providing a wide range of vacation options. This flexibility enhances the overall appeal of timeshare ownership.
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Long-Term Cost Efficiency: Despite the initial one-time cost, the overall expense of a timeshare holiday proves to be less expensive in the long run. Members enjoy cost savings over time compared to traditional vacation arrangements.
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Recession-Resistant Business Model: From the perspective of timeshare companies, the business model offers a guarantee of continuity and is generally resilient to economic recessions. This stability is attributed to the advance payments received from members.
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Financial Benefits for Companies: The advance payments received by timeshare companies facilitate loan repayments, reducing interest costs and substantially lowering fixed property expenses. This financial structure contributes to the industry's stability.
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Employment Generation and Domestic Tourism Promotion: The timeshare industry serves as an employment generator for local communities and contributes to the promotion of domestic tourism.
Disadvantages of Timeshare:
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High Upfront Payment: The substantial upfront payment required for timeshare ownership can be a major deterrent for potential customers, limiting accessibility.
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Negative Publicity from Unscrupulous Operators: Fly-by-night operators have tarnished the reputation of the timeshare industry, creating skepticism and anxiety among potential buyers.
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Quality of Service Concerns: Some timeshare companies fail to provide satisfactory services, leading to negative word-of-mouth publicity and damaging the industry's image.
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High Marketing Costs: The timeshare industry incurs significant marketing costs, impacting the profit margins of promoters. This financial aspect poses a challenge to the sustainability of the business model.
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Elevated Maintenance Costs: Maintenance costs for timeshare properties are relatively high, adding to the overall expense for owners.
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Perceived Expensiveness: Buyers may perceive timeshare membership as expensive when considering the interest component and associated costs, affecting the attractiveness of the investment.
In conclusion, the advantages and disadvantages of timeshare ownership present a nuanced landscape that requires a careful examination of individual preferences, financial considerations, and the credibility of the timeshare provider. The industry's unique features and potential for both emotional and financial returns make it a compelling option for those seeking a distinct vacation ownership experience.
Note: The provided information is presented based on the context of the article and general knowledge of the timeshare industry as of my last training data in January 2022. For the most up-to-date and specific information, it is recommended to consult recent sources within the industry.
