Lower valued kiwi will allow visitors to stay longer and do more, says industry boss.
Tourism Holdings chief executive Grant Webster says the falling New Zealand dollar will boost the visitor sector but is unlikely to encourage a big surge in numbers this high season.
Webster said the lower kiwi would allow those who had decided to come here to have a better holiday when they're here. "The dollar decreasing will allow people to stay longer and do more. We do really expect that people will upgrade - their dollar will go further on the ground," he said.
"In a broad sense people have made their decision to travel to New Zealand. This may make some people convert now [and come here] and this will give them more spending power on the ground and we'll feel that."
Latest figures show the number of short-term visitors in the year to August increased 5.3 per cent to nearly 2.8 million.
"What we've seen is demand growing and whether we agree or not, the Hobbit phenomenon is just that and people do want to come here," Webster said.
Tourism Holdings is New Zealand and Australia's biggest motorhome rental business and its profit soared 192 per cent to $11.1 million in the year to June 30 .
The reverse impact of the dollar is also true - the New Zealand dollar at around 77c against the US dollar now is not going as far as it was in June when it hit 88c.
House of Travel commercial director Brent Thomas said the sharp fall in the dollar was unlikely to put people off travelling overseas.
"People instead of going for 14 days will go for 13 days and that takes care of the effects of the movement. The reality is people have a budget and they work to that instead of saying no."
Even at current levels the New Zealand dollar was still strong and well above its 10 year running average
"Even if it was to slip back to that average between 70c to 75c we still think we'll see growth into the US market given the capacity increases and the exceptionally good pricing into that market," Thomas said.
New Zealand residents departed on 2.24 million overseas trips in the year to August, up 2 per cent from 2013, said Statistics New Zealand. Around half of all trips by New Zealand residents were to Australia with the next most-visited destinations the United States, Fiji and Britain.
The corner office - Grant Webster
Grant Webster, 42, has been chief executive of Tourism Holdings for the past six years. Before that he was general manager for Auckland at SkyCity and a manager at Woolworths supermarkets.
Q: What is your personal business philosophy or key business focus?
A: Keep your integrity in everything you do, realise the potential of people around you and look for insights everywhere.
Q: What was the best business decision you made for the company?
A: Entering the United States in 2010 and the timing of that - it was about identifying the cycle and when it had bottomed out. We have $30 million in assets there now.
Q: What was the hardest or worst business decision you made and what did you take away from it?
A: The hardest is any closure that I have to do and throughout my career I have had to close retail stores, manufacturing plants. Those have an immediate impact on the economy and, more importantly, the crew. The philosophy I've applied there is that if you know it's a good business decision, you know any good businessman would make that decision, is to do it in the best possible way for the best possible result for the people there.
Q: What are some of the key things you have done that have helped the company succeed?
A: Bringing together different teams from around the world. We've got three owner-operators still involved in the business after 20 years. To have kept those people in the business is testament to being able to keep their skills to enable the business to succeed.
Q: What are some fundamentals businesses need to do to be successful?
A: Understanding what your business model is and what is happening in that industry worldwide and what could disrupt it. Disruptive technologies, disruptive business models, pricing and channels to market is growing in pace everywhere. You can not ignore changes in any of those fields.
Q: Do you have a golden rule you follow or a business motto?
A: You've got to be adaptable.
Q: What do you think are some of the most common mistakes businesses make?
A: A lack of awareness of what's happening externally or broadly in the business. It happens too often that people have an idea they want to execute and they make the numbers fit. It sometimes works but the discipline to say no and stack up the numbers is critical.