Travel agent consortium Advantage is in talks with the CAA about becoming a franchisee Atol holder in a similar model to the one pioneered by the Travel Trust Association.

Speaking on the eve of the Advantage conference in Lucerne this week, John McEwan chief executive, said the agreement , if approved by the CAA, would allow it to offer all members a trust account facility.

Two weeks ago TTA/Worldchoice managing director Simon Hargreaves suggested there would soon be consolidation in the independent travel agency sector with the possibility of the TTA forging alliances with other groups for which it could run trust accounts.

He doubted any other agency groups had the experience of running such potentially risky and complex financial schemes.

But although McEwan said discussions with the CAA were at an early stage he was confident an agreement could be reached.

“We already have Advantage managed services which is a reasonably new initiative where we run back office accounting for members. That’s all done through a trust accounts process.

“The other dimension we are talking to the CAA about is Advantage becoming almost a franchisee trust account operator on behalf of the CAA. That would enable us to offer a trust account facility across the membership.”

Trust accounts have long been resisted by Abta, the trade body which McEwan is also chairman of, because they have been historically open to abuse and fraud.

However, the TTA model is based on individual trust accounts for members which have co-signatories independent of the travel agent and TTA management.

The association claims the system is so water tight no customer or supplier has ever lost their money dealing with a TTA agent.  The main downside for agents is that it can limit cash flow.

Asked about Hargreaves’ prediction of consolidation in the independent sector McEwan would not rule it out but said it was not something under consideration.

“Consolidation is inevitable in any industry, but we are in a good position and we are making good progress independently and we have no plans to consolidate. But you can never say never.

“If something came along which was highly beneficial we would have to consider it but at the moment there is nothing we are looking at.

“It’s not a question of buying or selling because we would not sell but if there are areas of cooperation between different groups or consortia and that added value to both clearly we would work together.

“We are in a position now where I think the industry has matured quite a lot. We respect the other organisations out there and we have good relations with TTA/Worldchoice.

“We already work with aspects of TTA/Worldchoice in that we have a financial services company and we provide some of their members with financial services products. If there was an opportunity to move that along I would not be averse to that.”

The prospect of consolidation in the independent travel agency sector is nothing new. In 2006 super-consortium Triton was formed from an alliance of Advantage, Worldchoice and Global Travel Group.

But this fell apart in 2008 when Advantage left Triton, although this happened after industry speculation, denied by Advantage, that it had come close to being sold to Stella Travel Services, the Australia-based Global parent.

Stella did try to buy Worldchoice but was thwarted when TTA came in with a late bid which was accepted by that consortium’s shareholders.

Worldchoice continued to be member of what remained of Triton, but TTA decided not to join and the super consortium has now morphed into a loose travel agent group called the Federation of Independent Travel Agents (FITA).