Cadogan Holidays is to be relaunched as a Morocco and Gibraltar specialist within The Bland Group’s consolidated travel division.
The tour operator, previously known as a luxury brand, now operates in the group’s Gatwick-based travel division Airbourne Representation Limited alongside flight-only tour operator Teleticket and representation company Skybreak.
It is hoped the move – which has already included shutting down Cadogan’s Southampton offices and halving agent commission – will enable Cadogan to break even this year after failing to make a profit for several years.
Managing director Neil Chapman, who heads up the travel brands including Hover Travel, which operates independently outside Airbourne, said: “Cadogan needs to get back to what it’s good at and return to its roots. We are not radically changing it but we are remodelling it.
“From April 2011 to March 2012 we are budgeting for Cadogan to break even. We have had to take out overheads and reduce agent commission to do this.”
He admitted passenger numbers could come down as a result but margins will be higher. Trade sales are likely to become a larger slice of business, up from 80% to 90% in the next year, he said.
The company will refocus on its two main destinations of Morocco and Gibraltar and plans to introduce new ‘quirky’ product and broaden its customer base.
Although it will continue to sell Tunisia and Egypt, these destinations will not be actively promoted and will not be included in brochures.
The operator scaled back to north Africa and Gibraltar at the end of last year when it shut Cadogan’s Southampton offices, making the entire team of between 40 and 50 staff redundant.
In December the operator halved agent commissions from around 20% to 10% to reduce overheads, with the result it is no longer on the preferred supplier list of the Advantage consortium.
But Chapman is confident agents will understand the operator’s need to cut costs and will still support it. “Advantage agents are still selling us,” he added.
Cadogan no longer has a separate ATOL and IATA licence. Airbourne operates under one ATOL licence, for 25,000 passengers, with all brands using one sales, marketing, administration and finance team.