Hays Travel is urging its agents to sell more long-haul trips under a new strategy based on calculations that a “long-haul passenger is three times more profitable than a short-haul passenger”.
The ambition is being viewed as a key way of countering the impact of the Budget, with Hays Travel forecasting staffing costs next year will rise by 10% – amounting to £6 million – as a result of the employers’ national insurance rise and the increase in the national living wage.
Hays Travel chief operating officer Jonathon Woodall-Johnston said: “It’s absolutely key that we continue to support our operators in the short-haul market, but we need to grow long-haul at a faster pace than we are currently.”
The business wants a third of its sales to be long-haul trips as part of its preferred product mix.
The new strategy was unveiled at the annual retail conference, held in Turkey this year, with more than 700 in attendance.
Hays Travel chair Dame Irene Hays described the UK government’s recent Budget as the “biggest challenge” the business will face in 2025.
Meeting the increased staffing costs will require a significant rise in sales, she said.
Among the further challenges she outlined is an anticipated 50% hike in rates imposed by local authorities trying to balance their own budgets and deliver key services.
Retail director Jane Schumm said: “We’re going to evolve our product mix. We will always sell short-haul holidays and support our suppliers who sell short-haul holidays, but just as we’re on a journey with cruise, we will begin an improved journey with long haul to ensure going into the next financial year we will deliver even better in that area.”
Woodall-Johnston pointed to figures showing long-haul sales generate significantly higher profit per passenger than short-haul.
“A long-haul passenger is three times more profitable than a short-haul passenger,” he said.
He outlined a three-year growth plan for increasing the number of long-haul passengers.