Tour operator market closed to new competition

A tour operator looking to open a business in downtown Ottawa may want to think twice.

Ottawa is set to turn what was a pilot project limiting the number of tour kiosks and preventing new ones that can open up on Sparks Street into a permanent bylaw by 2013, according to Philip Powell, the City of Ottawa’s manager of licensing, permits and markets.

“We’re working to get the bylaw done and reviewed before the council by end of July,” said Powell.

The trial regulation that has been in effect since 2008, was a solution to the dispute between the Sparks Street Mall Authority and tour operator businesses that had kiosks on the Spark Street mall.

The mall authority made a decision to remove all tourist kiosks from the mall strip because they took up too much pedestrian space.

After receiving complaints from the tour operators, Ottawa City Hall intervened and came up with the two-year pilot project that would waive the Authority’s decision and allow the existing tour operators to remain on site.

“We understand the importance of tourism so we didn’t want to see the tourist services not be able to provide for our city,” Powell said.

Powell said tour operators shouldn’t expect any drastic changes to their businesses when the trial regulation becomes a permanent bylaw.

Business security

Lady Dive Tours is one of the three tour businesses affected by the regulation.

Diane Beauchesne, owner of Lady Dive, said she is very happy with the news because the permanent bylaw will bring some security to her business.

“We can do our publicity and marketing without fear that they [City of Ottawa] will make a sudden change that will affect all our hard work,” said Beauchesne.

Even though it allowed tour operators to remain, the regulations had new rules that the businesses had to follow.

Tour kiosks had to control the loud ticket-sellers and stop confusing consumers.

“There is not enough space at the end of Elgin Street to accommodate all tour operators because there is very little curb space,” Philip Powell, City of Ottawa.

“There’s the typical haggling and peddling of their services. And they would be very loud and competing for the same customers. It can ruin the experience,” said Powell.

Ticket sellers are not allowed to compete for customers in front of their competing business’s kiosk. They have to stay within their own areas.

Other rules in the regulation required tour operators to keep their kiosks open from 8 a.m. to 5 p.m.

Limited space

But there’s another catch — the regulation also prevents any new businesses from entering the already tiny market.

“There is not enough space at the end of Elgin Street to accommodate all tour operators because there is very little curb space,” he said.

Not all tour operators on Sparks Street benefited from the pilot project.

The regulation only affected tour operators that used the curb space to pick up and drop of tourists around Spark Street.

Haunted Walks Tour had a kiosk on Sparks Street but it did not rely on curb space like buses or trolleys.

The company moved its kiosk out of Sparks Street mall onto Clarence Street.

Despite affecting only a small pool of businesses on Sparks Street, Powell said it was important for the city to “jump in” and allow the tour buses to stay in this prime location on the mall. Powell says the tour operators bring in large revenues to the Ottawa economy.

Bylaw reduces competition

Doug Wotherspoon, who owned Capital Double Decker and Trolley Tours, before selling it to Laidlaw Transportation Services 10 years ago, said the regulation has its pros and cons.

Wotherspoon said when he opened his business the environment was very competitive because there was no regulation.

He said the new bylaw can provide security for tour operating businesses and fine businesses that don’t stick to the rules.

However, Wotherspoon points out the bylaw may be too restrictive, by preventing other businesses from entering the market.

But Beauchesne likes it that way. She says because there are so few tour businesses in the area, competition is not an issue.

“We all get along well and have no problems. We help each other out as much as we can,” she said.