Tour operator Kuoni will add to its three high-street travel agencies in the UK, but chief executive Peter Rothwell confirmed the company will open no more than 10.
Speaking at the Institute of Travel and Tourism Conference in Dubai on Tuesday, Rothwell said: “Ten shops is the maximum within our planning horizon. I suspect they will have no impact on good agents.”
In March, Rothwell told Travel Weekly he planned to open 10 to 12 branches – “nothing to frighten the travel trade”.
He said the aim of the shops was to promote the Kuoni brand and replace distribution through TUI Travel and Thomas Cook outlets that had been lost.
“We have been squeezed by the big two in distribution, particularly by TUI, and we have to replace that,” he said. “We have three shops in the UK now and they are a pretty profitable opportunity to replace business that has been lost. Our shops have to be upmarket – it is about portraying the Kuoni brand.”
Kuoni appointed former TUI Travel distribution director Derek Jones as distribution director towards the end of last year, with Jones taking up the post in March. Rothwell joined from TUI Travel in January.
There have been fears among some agents that Swiss-based Kuoni – one of the world’s largest tour operators – would seek to develop a larger UK retail operation.
Rothwell was speaking at the ITT Conference in place of Thomas Cook chief executive Manny Fontenla-Novoa, who withdrew amid concerns about the survival of Thomas Cook’s controlling shareholder, Arcandor. The German retail group has warned it could file for bankruptcy this week.
The Kuoni boss denied he has any interest in buying part of Thomas Cook. “There are some big differences between Thomas Cook and Kuoni,” Rothwell said. “We are not in Germany, so would not benefit from synergies. There would be competition issues. It would be wrong to say ‘never’, but it is an unlikely move and would be quite a financial stretch.”
Rothwell also denied Kuoni was taking a hit on heavy discounts for late bookings in the UK. He said the discounts were coming from hoteliers and other suppliers.
“We are keen to get any business we can and working strongly in the lates market,” he said. “But we are not doing the discounts on the assets. The margins are broadly the same for us.”
For more on the ITT Conference, go to www.travelweekly.co.uk/ITT2009
For more on Peter Rothwell and his plans for Kuoni, go to www.travolution.co.uk