More than a quarter of all tour operators and travel agencies are now running at a loss, two new reports claim.

The surveys from travel analysts Plimsoll revealed 283 out of 1,000 tour operators are now making a loss, while 234 travel agencies out of 814 surveyed are in the same position.

Plimsoll senior analyst David Pattison added: “Increasingly, we are seeing companies making a loss for the first time in their history, and they can rightfully claim they are victims of difficult trading conditions.

“A quick refocus on profitability would ensure this is an isolated occurrence.”

However, Pattison warned it was more alarming that as many as 128 tour operators and 95 travel agencies are now making a loss for the second or third year in a row.

He said: “These companies are either blatantly undercutting the rest of the market to enhance or maintain market share or, more likely, have delayed making the painful decision more prudent companies have made recently.

“No one wants to trim costs, lay off staff, cancel dividend payments and the like, but continuing on regardless is fast becoming unviable.

“They can’t bury their heads in the sand any longer.”

The reports are called Plimsoll Industry Analysis – Tour Operators, and Plimsoll Industry Analysis – Travel Agents.