Agencies experience growing gap in sales volumes

Nearly half of the UK’s biggest travel agents have seen their sales increase in spite of the economic slowdown, a new survey has revealed.

The report by travel industry analysts Plimsoll Publishing revealed that 400 of the 845 agents with the highest turnovers in the UK have seen their sales increase by up to 15%.

However, the downswing has not been kind to all, a further 283 firms – 33% of those surveyed – have seen their sales decline, some by as much as 20%.

Plimsoll senior analyst David Pattison said: “The recession seems to have accelerated a shift in the market.

“Some companies have clearly been affected by those that have swapped to low cost alternatives or by the loss of a key client. Others are clearly benefitting from this move.

While agencies may be experiencing a roller-coaster ride when it comes to sales, the majority – 67% – have seen their profits drop with one in four currently losing money.

The remaining 33% have seen increased profitability with some reporting margins of more than 5%.

Pattison said: “The recession has been a good thing for a number of companies, it has sharpened their management and improved the accountability of the directors, so much so that these reorganisations are already leading to an increase in profitability.

“However for those that have yet to come to terms with this changing market, times are tough and they risk falling further behind the successful competition unless they respond to this changing market.”

Previous Plimsoll research has revealed 69 travel agencies are ripe for acquisition as a result of the economic downturn.

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