Seychelles, Republic of: Interview with Mr Roy Kinnear

Mr Roy Kinnear

CEO (Air Seychelles)

Mr Roy Kinnear

As a paradise, as a beautiful paradise in the Indian Ocean, Seychelles competes with many other island nations across the globe from Southeast Asia to the Caribbean, as well as with the nearby countries such as the Maldives. Nevertheless, Seychelles has managed to position as one of the top tourist destinations worldwide. So I would like to know what competitive and comparative advantages set this country apart from its main competitors.

Seychelles as a destination has held, holds, and it probably will continue to hold a position of mythical paradise. It literally is viewed as that once-in-a-lifetime or once-in-a-decade place to go to and I see no reason that that is going to change. So I think it already holds a special place in the vision of people on their list of places that ideally, if everything was possible, they would like to go to.

I also think Seychelles continues to be what I call a niche market. Seychelles has a very clear objective; it wants to maintain this balance between tourism and its strength as a natural eco-environment. Over 50% of the land mass in Seychelles is protected. It's not going to be bulldozed down and replaced with the world’s greatest concrete hotels ever because the minute you do that Seychelles is no longer Seychelles. It does have this very fine balance where there does not need to be a tenfold increase in tourism this year. You do that, you break the model completely. So, for Seychelles it's about a very planned, staged, managed, steady rate of growth which does not upset the balance of nature in Seychelles and it's also manageable from an infrastructure point of view.

It’s got a great reputation of being a very safe place; it's certainly not a country that's linked to any international political turmoil; and I would point out as an airline CEO that Seychelles has a great policy and has done a lot of great work in the past in being visa-free. There is nothing worse than if you're a traveler, be it for business or leisure or trade, and you have to jump through hoops to get to your destination. Indeed, Seychelles has a real benefit particularly when compared to the regional operations in Africa, it's easy to get to.

 I think people who come to Seychelles realize you don’t need to Photoshop Seychelles.

The touristic sector accounts for up to 60% of the economy directly and indirectly, a share which is expected to rise in the next decade. However, the location of the Seychelles is a major factor: The closest country is 1,000 miles away. Aviation is vital to the country and is one of the main arteries to reach the country. What are the main challenges of the sector, and what are the main opportunities you perceive as an airline company?

I think the challenge is managing the rate of growth. Air Seychelles has been created historically as the safety net for Seychelles. Airlines fly here, they're successful for a couple of months and then bad times hit and they then want to leave. That's why Air Seychelles was created; Air Seychelles was created to be the travel cog in the wheel for inbound tourism. No matter what is happening in the world, Air Seychelles will always be here as the national airline.

Coming from an airline background, people want to set up flights at certain times of the day. Airlines have got to paste their connectivity together, which tends to lead to flights from international carriers arriving and departing at very similar times, and there's reasons for that in the airline industry. That will bring pressure on an airport the size of Seychelles, particularly for things like baggage-handling.

Moreover, we are going through the upward trend on oil prices again for airlines. That's something any good organization needs to be mindful of. Those are probably the two pressures I'd cite most for the airline industry here.

What’s the strategy of Air Seychelles so as to continue to grow and to attract tourists to Seychelles?

I think Air Seychelles has three very clear parts of its business and while Air Seychelles may look clean, simple, beautiful, it's actually an incredibly complex airline to run. You have an international element to it, and that's about bringing inbound tourism -over 90% of our guests will be inbound tourists- for the greater good of the country. As an airline, I have to put my commercial hat on and make sure that what international services we operate are sustainable and that I do not have to go back to either of my two stakeholders asking for handouts for subsidies. They’ve got to be commercially successful in their own right. So I think very often people can get emotionally carried away with, “Why don’t you fly to London? Why don’t you fly to New York?” They're very attractive destinations, but when you look at it commercially, can they stand on their own two feet year-round? Highly unlikely. We've done the numbers. There is a lot of airline capacity from the big carriers and they need to fill those seats. So we need to be sure that wherever we operate direct services they stand a better-than-average chance of success.

Secondly, we also have an increasingly strong regional sector. There are very few airline markets in the world that can financially survive flying guests every week between City A and City B.. They need to have a network behind them and that network is like a puzzle – it needs to be interlinked with good connectivity. Take a look at Seychelles regionally. We've got India. We have got the United Arab Emirates. We have got Mauritius, Madagascar, and two destinations in South Africa, Johannesburg and Durban. That's an incredibly strong business unit in its own right. There is a lot of traffic between Seychelles and Mauritius. There's a lot of traffic between Seychelles and South Africa. There equally is a lot of traffic between Mauritius through Seychelles to India. So they all supplement each other giving you a very strong operating model year-round.

The third piece of the puzzle is the domestic operation – the service to Praslin, the charter services that we operate to Bird Island, etc. Again, that's a very strong business model in its own right, but believe it or not just over 50 to 55% of our guests on our Praslin flights are actually inbound tourists, which is great for Praslin because we provide the air services to link the residential and local traffic; and with over half the guests staying in accommodations on Praslin, that reverts to the economy of the second biggest island.

So the purchase of the two Twin Otters is also part of the strategy?

Yes. The two previous aircrafts were over 30 years old. I now have six Twin Otters, the oldest of which is 5 years old. Those aircraft are perfectly suited to this terrain and conditions. And because we now will have a young fleet, we will now be increasing the number of flights even more because you have less requirements on aircraft maintenance. It doesn’t mean to say the safety focus is any less, but just having newer equipment means you can run it harder. On a quiet day, we fly just over 40 flights, on a busy day just over 60. So, going forward, we will be flying mid-70s to mid-90s flights per day between here and Praslin starting in May.

Whenever an international aircraft comes in, we will have our Twin Otters planned every 10, 15 minutes to take off with guests coming off international flights into the mainland and flying onto the islands. It’s a good business model since we all support each other. This is also why Air Seychelles grew by over 20% last year, and this year we'll grow by at least another 30 to 35%.

Is Air Seychelles still looking at potential partners?

Absolutely. I think we need to split it into two. Etihad Airways is a stakeholder partner who effectively has put in 40% of stake holding in the company and it brings major benefits in areas such as training, procurement and supply chain. If a company the size of Air Seychelles went out and tried to buy a $7-million aircraft on its own next year, we would be charged a different rate than being part of a bigger company or group of companies that can influence buying power. Therefore, we get significant benefits through purchasing by having membership in a larger group. Such partnerships don’t influence or affect the day-to-day running of the company, but you use those synergies and benefits of an organization of that size to help move your own organization forward. That's one type of partnership.

Separately, South African Airways are a huge partner for Air Seychelles. We fly into Johannesburg and Durban South African are a major, a key, and a good partner because there are many cities in Africa that I cannot possibly serve that South African can. Air France are a key partner as well.

I am a strong believer in utilizing and leveraging the benefit of a partner. You've got to use the power of Air France. You've got to use the power of the name like Scandinavian Airlines. You've got to use the power of the name like Airberlin, Alitalia, Jet Airways, South African Airways. Those are well-known names in their home markets, so you partner with them and you work with them to widen your distribution.

So partnerships are here. It's a key part of our business. I believe a partnership has to be win-win. We as an airline have to get a win out of it and whoever we're working with, it has to bring benefit to them too. To make partnerships work, you have to put in time, effort, investment, and you both need to make sure you're getting a return on your investment.

How is Air Seychelles incorporating social responsibility in its management and strategy?

I will split that question into two. First of all, traveling on Air Seychelles. I see Air Seychelles as an extension of Seychelles as the country. If you take a look at the Air Seychelles aircraft, last year it was voted one of the five most beautiful tail fins in the world and it is a beautiful aircraft to look at. You get on that aircraft in a country that does not have the beauty of the landscape that we do here, nor the sunlight and daylight we do, and it looks good. My cabin crew are 100% Seychellois nationals and will always continue to be so under my remit, because we're small enough that I believe my crew can bring a personality. They bring something different because they spend time talking to guests and answering questions about what’s it like in Seychelles. So, before you even arrive here in Seychelles, you already have the feeling that you're going to Seychelles and paradise.

As to Corporate social responsibility: because of Seychelles low population, Air Seychelles, being a national carrier, is a major brand name in the country. It's a major employer. Many people in one way or another through either employment, friends and families employed or through companies who do business with Air Seychelles, Air Seychelles touches many parts. I firmly believe along with my management team that we have an embedded role in the country.

We have a huge CSR program. It ranges from things such as working with the Ministry of Health. If there are either residents or guests who are here in need of medical treatment that cannot necessarily be provided, if it's within our power or ability to help with air travel for medical cases.

It can be in the education industry for school exchanges across the Indian Ocean. If there's a school exchange between a school in Mauritius and here, we'll participate in that.

Sport teams can only play each other in Seychelles. It's good to have sports teams engaged across their colleague nations in the Indian Ocean and Africa. You then come back to things such as rewards programs. For long-serving employees or people who have contributed back to society, it's good to give them an airline ticket as a reward.

We work with orphanages and schools for development of children. There are many children who for one reason or another have never seen an aircraft or stand in an airport. There are occasions during the year where we will actually work with some of the schools and we'll actually bring down 15, 30 schoolchildren, do a tour around the airport with the Civil Aviation. We'll then bring them out so they’ll actually meet the pilots, see cabin crew, get on board the aircraft, and we'll actually take them up for a 10-, 15-minute sightseeing tour.

We have partnered with the Seychelles Round Table to bring 100 water fountains to primary schools so that all schoolchildren can now have free, accessible, potable, purified water.

It is also good for Air Seychelles to participate in the community. It lets the community know that Air Seychelles is not a hardnosed, black-and-white commercial company who’s sitting in an ivory tower trying to make money.

With your extensive background in the airline’s history, what’s your ambition for Air Seychelles and where do you see Air Seychelles in five years from now?

I'm famous for my mantra and my strapline here: There is never a finishing line. Never. And if we reach the finishing line, I'll change it and I'll move it forward. I love my job, I'm very enthusiastic. This year we'll grow by 30 to 35% and I'm already thinking 12 months down the line. You have to keep moving a company forward. You have to do it sensibly so that it does not break the company and that it adds value to the country it's in.

I firmly believe and it's just my own view, be it right or wrong: In this competitive day and age, if you stand still you'll be swallowed up. Your competitors will eat you alive. So for us to think foolishly that we as Air Seychelles are a success and we're going to sit at this level for the next two to three years, absolutely not. Competitors will tear us apart. I would rather be at the head of that than at the tail of it.  So I'm going to make sure that Air Seychelles continues to grow economically and commercially, but also to grow in terms of its caliber within the company.

A good manager must be able to see potential in its employees and to impulse its development. That's good not only for the individual and its performance, but also good for a company as it is a safety net for an organization to have multiple people that can at least partly cover each other’s roles. It strengthens the individual. It strengthens the company. It brings interest to the job as well.

eBiz Guides is the premier guidebook for business globetrotters, who are potentially interested in doing business in Seychelles. What would your final message be to our readers?

There is this view that Seychelles is a “mythical place that I'm never going to be able to afford or reach” That's completely wrong. There is an ever-increasing range of travel opportunities to reach Seychelles, so it is possible to reach it and afford it.

The second thing is, Seychelles is not this preconceived idea of only five-star hotels. Seychelles has got a range of accommodation for five-star, four-star, three-star, self-catering guesthouses. It can be what you want it to be.

And equally, Seychelles as a country is more than beaches. It has an absolutely fantastic blue economy. You only have to open some of the newspapers or magazines and you see photographs of ordinary people, who have actually gone out on a boat deep-sea fishing or fly fishing, and they catch these fish that are truly massive and have got every color in the rainbow under them. It has so much more to it than its perceived, Seychelles, and you've got to come here to see it and believe it, and it truly is as beautiful as it's portrayed. You don’t need to Photoshop Seychelles.

From a business perspective, Seychelles as a country is very open to investment. It wants expertise from many parts of the world to work hand in hand with its local population to develop it.

 If you take a look at the markets that we as Air Seychelles operate to, for instance, Dusseldorf: you can see that it will be about bringing inbound tourism, but it’s also an incredibly important trade and commerce route for us as and for the Dusseldorf region.

You need inbound cargo coming in for the foodstuffs but also outbound cargo. We have a fantastic relationship with fellow fishery companies here; we export over 150 ton of frozen fish every quarter. It's a great example of the airline working with a local business, providing employment, exporting your local goods. Trade and commerce is equally as important as the whole tourism tag.