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07 Sep 2018

BY Rob Gill

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TRFBLI

Trade winning when the heat is on

As England stormed to the most unlikely of World Cup semi-finals during what was this week revealed to be the joint hottest summer on record, Rob Gill finds out how travel weathered a perfect summer storm.

Sunbathers on sunny British beach
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Miles Morgan: “We’re helped by our demographic not being traditional fly-and-flop customers, so not a predominantly late-booking market. The winning tickets for us have been cruise and escorted touring."

Despite fears the hot summer would discourage overseas bookings, several independent agents have reported strong – if not record-breaking – sales in August.


Late summer bookings picked up for agents following a dip in July while the UK was enjoying its sustained heatwave and the unlikely distraction of England’s run to the World Cup semi-finals.


Agencies not typically focused on the late-booking beach market fared particularly well, industry figures told TTG this week, as the peak summer season drew to a close.


Miles Morgan, owner of high-street agency chain Miles Morgan Travel, said: “Trading was really positive and strong during the summer.


“I was surprised it was so strong, as traditionally the hot weather and World Cup is not a recipe for good sales.


“We’re helped by our demographic not being traditional fly-and-flop customers, so not a predominantly late-booking market. The winning tickets for us have been cruise and escorted touring.


“Our financial year ends in September and we’ve had another record year, which makes it 12 years on the bounce.”

Slow start

Slow start

Richard Dixon, director of homeworking agency Holidaysplease, said the market during early summer was “a little bit slower than we would have liked”.


“Overall, we’re pretty comfortable with how it’s gone,” said Dixon. “Sales picked up from mid-July onwards and we had a record August, with revenue up 12%.


“But in early July, it was like trying to get a big heavy train moving. Our homeworkers worked really hard, and it’s very pleasing that average revenue per sales team was up.


“We brought in a good level of business and discounting was down 22%, so we improved our margin.”


Dixon added he was not concerned about the growth of staycations in the UK following this summer.


“I think people will realise the UK is so expensive and you get much better value going to an all-inclusive in Greece or Spain,” he said.

Beach breaks

Beach breaks

Nick Harding-McKay, director of London-based Travel Designers, was bullish about the agency’s summer performance, particularly August, when sales rose 62% year-on-year.


“We’ve been marketing harder than we’ve ever done before,” he said. “We’ve really used being the number one agency in London [in the TTG Top 50 Travel Agencies] to promote ourselves this year.”


Harding-McKay added while July sales were slightly down, the agency enjoyed its best-ever June as it took an unusually high number of late bookings from families for summer beach holidays in Europe.


“This was a bit of an anomaly, as we usually don’t do a lot of late bookings – our main market is mid and high-end holidays, not so much bucket-and-spade,” said Harding-McKay.


“We’ve had a lot more people coming into the office, which is part of our strategy of getting more involved in the local community.”

Challenging market

Challenging market

However, Alan Bowen, legal advisor to the Association of Atol Companies, sounded a note of caution for the wider travel industry.


“Summer could have been better, as it was very quiet in June and July,” he told TTG. “It picked up in the last two or three weeks of August.


“The World Cup could have had something to do with it – consumers could also have been enjoying the summer weather and not thinking about booking a holiday abroad.


“This may be a case of delayed – rather than denied – bookings.


I would say the market this summer has been challenging.


“It’s been a difficult summer for quite a few businesses but there have been signs of a revival. The key thing is whether those customers who usually book during summer will return to book in the next few weeks.”


Chris Photi, head of travel and leisure at specialist travel accountants White Hart Associates, agreed trading conditions had “not been ideal” over the summer.


“Certainly, business has been impacted in the summer months,” he added. “The football was expected – although perhaps not England’s enduring participation – the weather less so.


“The weather in recent weeks has led to improved late bookings. The impact is likely to be a reduction in profits rather than any larger problems.”

Mediterranean beach
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