Another one gone today, or rather two first of all Manny Fontenla Novoa CEO of Thomas Cook since 2007 and his shock resignation following the huge fall in share prices
Just a few hours later came the announcement that Holidays 4U has also gone. They were the last of a string of cheap Turkey operators this time leaving 12,000 holidaymakers stranded. I wasn’t surprised by the announcement but the timing took me completely by surprise. I had not booked any clients on holidays 4 U, partly because they had no availability for August. Their flights and hotels were almost full to capacity at a peak time of year when they have the most revenue. The reason they did go under at this peak time of year was because they are taking the clients’ money earlier and using this to fund the holidays as well as their overheads. Because they are full they were not taking enough new funds in to pay their staff or their bills
Holidays 4U follows a string of similar companies such as Goldtrail and for Greece it’s the same story with Kosmar and Argo disappearing and Manos being taken over by Thomas Cook.
It is particularly difficult for these pile ’em high and sell ’em cheap companies to survive because they are making so little profit and are still committed to various costs to contracted hotels and staff both here and overseas. Customers demand cheap holidays and for many it has cost their very survival.
Internet companies are also vulnerable because they are surviving on very small profits and they do not rely on, or expect loyalty. The type of client who would book with companies like packyourbags.com or verycheapholidays.com will invariably be the client who throws caution to the wind and will book the very cheapest, no matter who it’s with.
So what makes Travel Counsellors different? And why are we financially secure? First of all everything we book is 100% financially guaranteed as we have a special insurance nso your money is always fully protected. We also individually have liability insurance. We do rely on service and loyalty and we do expect customers to recommend us to others, not because we are cheap but because we provide excellent service and attention to detail .
We all work on commission only and share profits with head office so with each of us working our individual franchises our overheads are very low so if we as individuals fail to make a profit it doesn’t affect anyone else, but of course it is in our own interests to generate our own profits, so it is in our interests to get the most suitable choices which may not actually cost any more than with fly by night companies that come and go. We don’t actually aim to be the cheapest, we aim to be the best
As a company, our turnover often tops £1 million a day so we are, as a whole, a very profitable company, even through these difficult times, and as we deal with everything from Aberdeen to Zimbabwe, we have to deal with all the world’s problems, not just Turkish or Greek flights and hoteliers. We are surviving the recession, airline strikes, ash clouds and failed companies and will continue to do so through thick and thin.