Fears of a shake out in the accommodation-only sector were confirmed this week when bed bank Bluebookonline ceasedtrading.
The company blamed the slowing economy, failure of XL Leisure Group and move away from dynamic packaging.
Payments for the 10,200 forward bookings are protected by the company’s trust account, but most of the 26 staff have been made redundant.
Sales development executive David Smith said: “It has been a tough market and the collapse of XL means people have been wary of booking dynamic packages. They have been turning back to traditional packages.”
Smith suggested the company’s collapse was the first sign of consolidation in the sector.
“The accommodation-only sector needed to be streamlined and I expect we will see more of that,” he said.
Set up in 1996, Bluebookonline was one of the original bed banks and amongthe few that acted as a principal in transactions. Advantage appointed it as a preferred supplier only last month.
Advantage business travel director Norman Gage said: “Margins in that market are cut–throat. Everyone is punting the same hotels.“
The failure came as Thomas Cook Groupdenied rumours that it is poised to buy accommodation-only provider Medhotels from lastminute.com. The online retailer also denied a deal is in the offing. However, sources predict a sale is imminent.
Thomas Cook has said it is on the acquisition trail and managing director of scheduled businesses Sue Biggs confirmed the group is on the lookout for takeover opportunities.
Speaking at this week’s ABTA Travel Convention, Biggs said: “We are looking for businesses that have the potential to be well-run.If anything, the acquisition side of things accelerates during slower trading times.”