Money management in the argentinean tourism market 

Argentina is a country with a weakness economy and it is easy to show when specialists
put in the center of the scene different charts like economy growth, inflation rates, volatility
of exchange rate, unemployment and poverty. Tourism market is not the exception
because one of the principal indicators of the economy as is the dollar is the anchor in the
industry and therefore a low price of the dollar incentive Argentinean to travel out of the
country while a higher does not. In this writing we don’t focus on the rate peso/dollar but
also the main theme of this is put attention on the different strategies to not to lose money
when a manager is in charge of the business, especially when the person is working with
emissive tourism.
The main task of the money manager is try to avoid all the risk possible in the market. We
can distinguish some types of risk. First and foremost, important is the market risk: it is
divided between the systemic risk and non-systemic risk. First of those, called systemic
risk is that which includes some variables almost impossible to control and the impact on
the public and companies is general. It can’t even be avoided diversifying the assets and
when the agents have money working it is probably that lose part of that. Instead, we are
talking about non systemic risk when exist particular risks on a determined market or asset
and it can be avoided buying or selling different shares, bonds or currencies. The
difference between both is clearer when we give some examples: decisions of the FED
about the yields of the treasuries bonds, a trade war between the main countries, in
economic terms, or others relevant issues that can include the whole financial world. All of
those are component of the systemic risk. In the case of non-systemic risks, it is produced
by own issues, specially of an asset or market in particular and can be avoided through
diversification. 
On the other hand, there are some risks that are related with a particular industry or
category. In the emissive tourism industry, we find some risks also all the mentioned
before, and these are: cancellation of the hired services by passengers or their default of
the debts, variation of the exchange rate, reprogramming of services by the companies or
simply the wrong management of the main risks. In Argentina, in the 2011, a policy
launched by the government forced  
The question here, is ¿How does managers not to lose money? Money that definitely is
not yours. We have been seeing during the last years how big companies that were
working principally with emissive tourism went bankrupt. Perhaps there is not an only one
cause but we recognize that exist some patrons repeated: 
1- Huge organizational structures and therefore, big fixed costs 
2- Incorrect use of the money, in particular of the Argentinean currency
3- Bad administration of the current assets and liabilities 
4- Investing in long terms assets with too risk.
Different items mentioned in the previous paragraphs are directly related. First item
requires an intensive analysis because in the whole world are appearing these problems
derived from old structures which have never modified it, and finally end with bankrupt
companies. Specialists agree that in the new century the companies must cut the amount
of personal or in the maximum case, try to redistribute the task with the goal of achieving
more efficiency in the work. Efficiency and effectiveness are indicators so valuables in
economic terms because allow to do better analysis of the costs and the work capital and
its use. Tourism industry is the best instance to use: the appearance of different
applications and platforms have made that the potential customers can choose between
some options comparing prices and services at the moment, without the need of calling a
tourism agent. It has produced big changes and need of restructuring the companies,
which now should compete against a network market. So, it implies less contact and
movement at the offices and even more the quantity of sales. The owners and managers
should try to avoid rigid structures adapting to what the capacity of the company can afford
but without being outside of the legal and labor framework.
In second term, when we are talking about the money management we want to mark the
magnitude of having a good administration. When a company of emissive tourism
manages a lot money, it becomes in a risk administrative. The important here is not to use
or not spend more money that you enter. Although it seems easy, not always is reached.
Once defined the current assets and liabilities besides recognize and balance the fixed
costs, managers must protect the capital. How we have mentioned before, in a country
with a weak currency is possible that high interest rates appear in the center of the scene.
However, interest rates are taken by economist like a lucky of devaluation expected and
some managers could use the local current to win an additional income (as long as the
exchange rate remains stable) for finally repurchase more quantity of foreign exchange. It
strategy is called carry trade, and this movie has been watched many times in Argentina,
where for getting a marginal benefit, companies finished losing its most part of capital in
dollars, generally. Carry trade is a strategy very complicated because the manager should
know when get out of the market, and wait the money one more day will bring problems.
So, our advisements are various:
1. Managers should be able to restructuring the company in what wages concern. We
suppose that is better a low fixed salary with high fee for sales instead of the
contrary case. In this way, the employees will work to generate more sales and
therefore will try to improve their customer consultation on sale made. Finally, offer
sale employees a progressive scale of benefits as sales increase. Somebody can
tell us about the need of a contingent plan in crisis times. It is called operating
leverage. 
2. Since the moment the directors or managers in finance receive reports of the cash
flows or the cash status, they become in risk managers. They take the decisions
about the future of the capital of the company and the future of the employees. In
Argentina, should be obligatory not to use the interest rate to make carry trade
strategies with money of the travelers because the services hired are always listed
in foreign currency, principally in dollars or euros and if there are possibilities of an
exchange run the story will finish with a poorer company and passengers with risk
of not travelling. So, daily the administrative have to separate the money in
temporal terms and know the cancellation policies of the tour operators. In fact,
when exist a knowledge of cancellation policies of the airlines and tour operators
the risk lows because the manager won’t use a money that has not in his power to
do advanced payments due it won’t be returned. 
3. Investments in long term should be led by assets without too much risk, especially
those issued by strong countries (for instance Germany or The US), companies or
simply banks. Logically, an investment with low risk implies low yield. It is important
to see how many times the issuer has defaulted the debts and in which situation is
the liability. 
To conclude, we suggest managers to protect not only long term capital but also the
current, because in crisis times long term capital can help hold on the business and in
reverse too. In add, in which behavior of the manager respect, is necessary to avoid non-
professional acts with the money.