Tourism SMEs in DR grow 18% in 2024 amidst digital transformation push

Santo Domingo.- Small and medium-sized enterprises (SMEs) in the Dominican tourism sector have seen an 18% growth in revenue for 2024, according to a report by Alegra.com, reinforcing their pivotal role in the country’s tourism landscape.

Tourism has long been a key pillar of the Dominican Republic’s economy, and with World Tourism Day highlighting the industry’s impact, the contribution of SMEs stands out. According to the World Travel & Tourism Council (WTTC), 90% of the nation’s tourism businesses are micro, small, and medium enterprises, accounting for 15% of the country’s GDP and creating over 800,000 jobs.

Despite their significant influence, these businesses face both challenges and opportunities, particularly as they navigate economic recovery and the shift towards digitalization.

Recent figures from the Ministry of Tourism indicate that the Dominican Republic welcomed nearly 7 million tourists between January and July this year, an 11% increase compared to the same period in 2023. The United States, Canada and Colombia remain the top countries of origin for these visitors.

The WTTC also predicts that 2024 will set new records for international visitor spending in the country, expected to reach $10.4 billion by year-end. Domestic tourism is also projected to hit an all-time high, with estimated spending of $3.7 billion.

This growth is already being felt by local tourism SMEs. Alegra.com, a cloud-based accounting and invoicing software tailored for small businesses, reported that revenues for tourism SMEs increased by 18% in the first half of 2024 compared to the same period last year.

“Alegra.com is witnessing how more small and medium-sized businesses are capitalizing on the tourism boom to strengthen their operations,” said Haydeé Cabrera, Strategic Leader for Alegra.com in the Dominican Republic. “This sustained growth shows that SMEs are adapting, growing, and solidifying their presence in an increasingly competitive environment.”

Digital transformation remains both a challenge and an opportunity for the Dominican Republic’s tourism SMEs. A 2021 report from the Economic Commission for Latin America and the Caribbean (ECLAC) highlighted that many of these businesses are limited to basic digital tools like Facebook, Instagram, WhatsApp, and email. The report found that 60% of SMEs cite the cost of implementing digital tools and hiring advisory services as a primary barrier to digital transformation, while 80% pointed to a lack of knowledge about new technologies and their applications in the tourism sector.

Cabrera emphasized that embracing digitalization is crucial for tourism SMEs. “For businesses that have implemented digital tools, we’ve seen significant improvements in efficiency, and more importantly, in their long-term sustainability. In a sector where quick adaptation to market demands is key, technology becomes a strategic ally,” she said. “Automating processes like billing, accounting, and inventory management leads to greater efficiency and time savings.”

As the tourism sector continues its upward trajectory, the digital readiness of SMEs will be essential to sustaining their growth and competitiveness in a fast-evolving market. With 2024 already showing strong gains, the future looks bright for the Dominican Republic’s tourism businesses that are ready to embrace new opportunities.