Tourism Slide Hurts Travel Firm : Vacations: Pleasant Hawaiian Holidays is coping with a recession-fueled decline in visits to the Aloha State with temporary layoffs, discounts and faith.

“Hawaii is more than a place. It’s a state of mind,” reads a recent brochure by tour operator Pleasant Hawaiian Holidays.

If so, the state of mind would be depressed, at least for some in the Hawaii travel business.

Hawaiian tourism hit the skids early this year, thanks to a combination of the Gulf War and a recession that overwhelmed consumers.

Indeed, the number of visitors to Hawaii fell 21% in February to 427,360 from 543,600 during the same month last year, according to Joseph T. Collins, an economist with the Hawaii Visitors Bureau.

That was bad news for Pleasant Hawaiian, a Westlake Village tour operator specializing in the Aloha State. Pleasant Hawaiian’s bookings to Hawaii fell 30% in January and 20% in February compared to a year earlier.

The company’s business has rebounded since then. In March, bookings increased 12% compared to a year earlier. (The Hawaii Visitors Bureau has not released its March travel figures.)

But the improvement in March comes in the midst of a longer slowdown.

Although the drop-off in Hawaiian travel began in earnest last fall--after Iraq invaded Kuwait--the company began to see some decline in business as early as 1989, said Edward J. Hogan, Pleasant Hawaiian’s owner and chief executive.

Pleasant Hawaiian had begun trying to cope with slower travel before the upturn in March. In February, Pleasant Hawaiian temporarily laid off 50 of its 650 workers--although it has now hired back 11 of them. Earlier, the company slashed its advertising budget, Hogan said.

Meanwhile, the tour operator keeps trying to put together tour packages that will pump up the anemic Hawaiian travel business.

Since it is a privately held concern, Pleasant Hawaiian won’t say exactly what effect the downturn has had on its finances.

Ken Phillips, public relations director for Pleasant Hawaiian, described the company’s sales since 1987 as “just flat, no growth.” In an interview three years ago, Hogan said the company had revenue in 1987 of $310 million.

Founded by Hogan in 1959, Pleasant Hawaiian is a sort of wholesale travel agency that puts together air fare and hotel packages that retail travel agencies can sell to their customers. Pleasant Hawaiian negotiates wholesale prices from hotels and airlines. The company’s profit comes out of the difference between that wholesale price and what the tourist pays for the vacation.

Hogan owns Pleasant Hawaiian Holidays through Pleasant Travel Service, which also owns six hotels in Hawaii.

Pleasant Hawaiian began to trim back its costs well before the February layoffs. The chief target was advertising. As recently as 1989, Pleasant Hawaiian spent about $8 million in advertising, including regular travel advertisements in about 80 papers nationwide. Pleasant Hawaiian cut its advertising budget by 63% to $3 million in 1990, advertising recently in only about 15 newspapers.

“In some of the cases, it was wasteful,” said Hogan of the company’s advertising budget, citing ads in New England and the Pacific Northwest that didn’t generate enough business to justify their cost.

Another advertising program that fell to the budget ax was Pleasant Hawaii, The Aloha State Magazine, a promotional publication given to tourists free in hopes that they would subscribe later. Hogan started the bimonthly about three years ago, but it never attracted enough advertising and lost $600,000 in the three years, he said.

Beyond trimming costs, Pleasant Hawaiian has tried to coax hotels and others to offer lower rates to the tour operator’s clients.

For instance, Pleasant Hawaiian now offers $468 off the regular price of a seven-night stay in a mid-priced room at the Hilton Hawaiian Village hotel on Waikiki Beach, lowering the price from $1,754 to $1,286.

And through Pleasant Hawaiian, about 33 hotels in Hawaii are offering a free night’s stay for every four to seven nights paid for. “That’s very unusual,” said Pleasant Hawaiian’s Phillips.

Hogan said his company also convinced a number of other tourist businesses to cut their rates for Pleasant Hawaiian tourists so that the Westlake Village company could add a set of coupons to all its travel packages. The coupons allow visitors to attend a luau and various cruises for free. (The company said the cumulative admission for all the activities would otherwise be $257.)

Things could be worse for Pleasant Hawaiian--it could depend on Japanese travelers. While visits by tourists who flew west to Hawaii (most of them from the United States) fell 18% in February, according to the Hawaii Visitors Bureau, visits by tourists who flew east to get to the islands (mostly from Japan) fell 30%.

In any case, Hogan figures tourist travel will pick up again--even if it takes some time.

Hogan has a theory about the downturn.

“Charlie”--Hogan’s name for the average consumer--isn’t traveling because he “has been programmed with negative thoughts” for several years, thanks to the savings and loan crisis, the recession, the Gulf War and other world-historical downers.

But Hogan believes that Charlie will start visiting the Aloha State again. “We have faith in Hawaii,” Hogan said.