There is business in everything these days. Recently, I took a trip to Sabah, Malaysia to hike Mount Kinabalu, and I could not help but notice that business opportunities exist almost everywhere- from the pre-booking stages, to during hiking and even to the post-summit descent stages.
When you pre-book your hiking slot, which comes with the accommodation arrangements at Laban Rata on Mount Kinabalu, you are given a choice to choose a hostel based on how much you are willing to spend. For Lemaing hostel, which is the simpler option at around RM364, you will be allocated a bed in a 16-slot bunk-bed dormitory, with three meals provided throughout the hike. For an additional RM200, the more comfortable option, Panalaban, comes not only with a single bed and more personal spaces, but also two extra meals on the day of hiking. Note that Lemaing Hostel is limited to Malaysian citizens only. Foreigners are only allowed to choose for Panalaban, which is the more expensive option- what an obvious market segmentation technique in practice to price discriminate. However, regardless of the options you take, as a Malaysian or not, the tickets unfortunately come with no heating or water heater. The temperature up at 3000m is cold and water at the hostels is close to freezing. Not supplying a generator for heating purposes minimises cost for the hostel operators. The hostel operators seem to know that hikers could potentially only stay in the room for relatively short hours but they would leave the heating on forever; most might even utilise the hot showers generously if given a water heater, both which compromise the profits from hostel rental. Moreover, generators up at the hostels on Mt. Kinabalu might only supply a limited amount of electricity, which then has to be prioritised for more important purposes like light and cooking. While the power supply there is already a bit unstable without room and water heater, as shown in occasional second-long power cuts, I can’t imagine what impact supplying room and water heaters will bring.
Additionally, what I have mentioned so far is if you make a booking via the official Sabah Parks portal. The booking is raw and only includes the hiking ticket, hostel, food, insurance and service charges. There are plenty of websites out there that provide packages that include guide fees, transportation from the airport and even flight arrangements. Some even offer tour services in Kundasang before or after the hike. These packages often provide convenience to those who are unable or unwilling to research on and plan their trips. Yet, they also charge much higher prices. Moving on, let’s talk about the hike. Hikers could hire porters to transport their baggage from the base to the hostel, which would cost them RM14 per kg. One way from the base to the hostel is 6km with an approximate elevation of 1100m. The porters would request for the baggage to weigh at least 10kg, which guarantees them a worthwhile income of RM140 per set. Along the hike, I noticed most porters were carrying more than one bag, suggesting that they provide services to several groups of customers at once. They were mostly young, fit individuals. While most of them were male, there were many female porters on the day of my hike too.
From our conversations with other hikers who have chartered such services, it seemed to us that Sabah Parks has its own regulations around the porter services. For example, porters will undergo training before they can accept jobs. They would wear trainee tags, and mostly carry bags or food supplies for the hostel cafeteria. However, it is unclear how long the training takes, and how much per hour these porters are paid while they are in training- and if they are paid reasonably. From what we observed, all porters are required to register themselves before starting their hikes for safety reasons. We did not collect sufficient information on many other details as we were too tired trying to complete the trail ourselves. So another thing unclear to us was if there is proper regulation on how much these porters can carry at a time and how many trips they can make within a certain period. On top of that, whether the working hours and pay are reasonable, and how strict Sabah Parks is on enforcing these regulations, seeing that labour services as such could very well depend on the porters’ own willingness to do the job. However, from what most hikers are offered, there is a fixed price of RM14 per kg for porter services. Price negotiation is less common for baggage porter services since it is more commonly demanded for, and charging customers different prices could easily spark competition. Without a fixed price set, porters could only compete by lowering their prices- since the service they provide is exactly the same. Doesn’t this risk more people being more underpaid? Certainly. Setting a fixed price might also be for operational convenience. There is clearly a self-established system between porters and guides where the guides will usually connect hikers with porters. With a fixed price, the guides can easily connect hikers with any porters available instead of letting hikers choose between porters who offer different rates.
The carrier taxi service works slightly differently. If any hiker is too tired to continue their hike, it is possible to charter a porter to piggyback them up or down the trail. Yes, there are people willing to do it for a price. While the common pricing is RM700 per 1km for a client weighing less than 60kg, it is actually negotiable and there seems to be a slight flexibility to lower the rate if you are persuasive enough. For carrier taxi service, it is needed in much rarer cases so most hikers would not know the market price. The porters usually understand that the price range should fall between RM600-800 per km, but would sometimes adjust the price if the customers’ needs simply mean a huge cost to incur for them. Again, the price might not be strictly regulated by the official Sabah Parks authority, and is left to the hikers and porters to decide how much they believe the service is worth.
I think the business strategy of not regulating the price of human porter services very strictly is due to Sabah Parks’ understanding of the market. If there are hikers who are willing to pay, and the porters are willing to take up the challenges despite knowing the underlying safety risks, they technically speaking could not be stopped from providing the services. There is little incentive for Sabah Parks to completely ban the act, as there is literally no other way to transport hikers who are unable to get down to the base- be it due to exhaustion or injuries. There are also challenges in setting a fixed rate as the hikers' weight and exact distance where the service is needed may differ from case to case. It is often left to the porters' experiences, in terms of the distance the hikers would need services for, to determine a price that is both affordable by the hikers and fair in compensating their effort. So, if I were Sabah Parks, why bother trying to regulate a market that already has the underlying convenience of the invisible hand?
Reflecting on my trip, Mount Kinabalu is a full-on hike from the base to the summit. I contrast this to my experience hiking the snow-covered Breithorn in 2021, where half of the elevation was achieved by cable car. In fact, cable car services are very common in Switzerland, since the geography is hilly and the country strategises to boost local tourism by improving accessibility to the highlands. Breithorn stands at a height of 4164m, which is almost 70m higher than Mount Kinabalu. From the town of Zermatt, a series of cable cars is available to transport hikers to Klein Matterhorn, also known as Matterhorn Glacier Paradise, which is a lookout platform at an elevation of 3883m that includes a restaurant, a ski base and an ice sculpture museum. From there, we only needed to hike approximately 280m to reach the summit of Breithorn, but the journey was made extremely tough by ankle-deep snow and bad weather- it simply felt like forever.
Could Malaysia mimic the same business strategy- install cable cars and charge tourists for profit? I spent four days taking cable car services in different locations of Switzerland during my trip there. I think their model is rather attractive and effective in generating profit off tourism. Another memorable experience was the First Cliff Walk by Tissot in the town of Grindelwald. We took cable car services up to an elevation of 2168m, where a metal walkway built by a cliff and connected to a restaurant exists. The place was filled with tourists and we had to queue up to take photos. That is an example of how touristic and economic activities can be boosted by having cable car facilities. However, having cable car services also suggests that Mount Kinabalu as an attraction would be much more accessible and the summit would lose its prestige and majesty brought about by the tough hike. Another key consideration required is building costs and environmental implication- is an investment as such worth it? Will it bring sustainable profits in the long run? Or would it risk Mt. Kinabalu losing its UNESCO Heritage status? These are for us to ponder. Do note that another possible reason cable cars are used in Switzerland could be that the landscape is too extreme or dangerous to hike, which is in contrast to Mt. Kinabalu. Moreover, Switzerland has many slopes up on the mountains that attract skiers, who typically come with huge ski equipment in their baggage. Cable car services make the most sense for them, in business terms, rather than to rely on porters.
Interestingly, a simple hiking trip could be a classroom for me as it exposed me to such fascinating economic phenomena happening in our real world. If only we had proper data to study and conduct analytical studies on the actual potential in this market, and how the tourism sector can contribute to our local economy. Anyway, if you would like to sponsor generators for the water heaters at Panalaban, please contact Sabah Parks directly. I would support you wholeheartedly. Thanks. By, Euan Thum, Journalist, Charisma Movement 22/23. Edited by To Ying Yun.