Senior industry figures have expressed a fears of a “domino effect” of company failures following the collapse of Thomas Cook.

This week the sector is reeling from the impact of the 178-year-old tour operator and travel agency entering insolvency.

Dozens of agency businesses and suppliers have been scrambling to re-book customers, with many due to be left out of pocket.

Speaking at Travel Weekly’s Business Breakfast event on Tuesday, Paul Carter, chief executive of Inghams parent Hotelplan, warned: “People are waking up to the fact that they are going to get pennies back in the pound. There will be other smaller travel companies that will suffer.”

Carter, who said he felt sorry for friends and colleagues at Cook, revealed Hotelplan’s distribution with the retailer had been diminishing, falling from double digits four years ago to just 4%.

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It also used Cook for flying which it will have to replace “at a price that we have sold all those holidays for.”

But Carter said the impact on Hotelplan would be less than the collapse of Monarch two years ago.

“The industry impact is wider,” he said. “There are a number of tour operators that relied on Thomas Cook for distribution and they will be impacted, so I worry about the domino effect.”

A call between Abta and the CAA was due to take place on Tuesday afternoon.

Kenny Picken, former Traveltek chief executive who is now an investor through his own company Cii, said the industry was just at the start of understanding what the fall out of the collapse will be.

“I’m saddened because it’s 21,000 jobs and all the other ramifications which will impact on the industry. There are a lot of tour operators that won’t get paid. Will they survive? Some will, some won’t.”

Adam Hansen, corporate development director at On The Beach, which this week warned that the collapse with have a material impact on its trading this year, said: “The effect is quite complex. In the short-term there will be exceptional costs as flights have been cancelled and we will loose margin on those bookings.

“In the medium term I think we will see some seat price inflation given the lost capacity but probably expect that to come back to equilibrium over the long term. It will be an opportunity for us to take our share of those passengers.”

Asked whether Cook had been a so-called “zombie firm” hanging on after the 2008 economic crash, Beth Houghton, partner at investor Palatine Private Equity, said Cook was “a big company that could not quite move as quick as it needed to in this industry.”

“It was a really tough task to move that business to where it needed to be, especially with the level of debt in the business.”

Picken said he was not surprised by the failure and had been expecting it since the last time it was bailed out in 2011. “At that point the debt was unmanageable and each year after that they were never setting the heather on fire. There were no signs that they were recovering.”

Asked if Cook chief executive Peter Fankhauser should have his bonus clawed back, Picken said he was brought in with recovery in mind and “would not have taken the job had he not been financially incentivised to take on what was ultimately a pile of sand”.