The failure to secure external investment coupled with difficult trading conditions have been blamed for the failure of tour operator Tana Travel and sister travel agency It’s Time to Travel.
The Stratford-upon-Avon-based business is due to appoint a liquidator by the end of this week. It ceased trading on September 27 after 28 years in business. It employed six staff, three of whom were company directors.
The brands, which also included gay specialist tour operator AwayGay, were owned by parent company Tana Consultants.
Historically known as an Africa specialist, the agency was rebranded as It’s Time to Travel a year ago to promote its luxury, tailor-made trips worldwide.
Former managing director Neil Basnett said the company’s collapse was the result of a culmination of factors following the decision of its majority shareholder to pull out a year ago.
This culminated in the failure to secure investment to maintain its Abta and Iata bonds and its Atol through the Civil Aviation Authority. At its height, the company enjoyed a turnover of £2.6 million.
Basnett said: “We did a management buyout a year ago because we believed in the company and bought it for £1 but we knew that licences were coming up for renewal this year and there would need to be a significant cash injection.”
The business found external investors based in South Africa, but the deal fell through in August this year.
“They said it was not a time to invest in the UK full-stop,” added Basnett, who said attempts to raise funding from its own bank were also denied because travel is seen as a “risky industry”.
The company was in the process of obtaining a secure loan for £50,000 but was forced to cease trading because it could not complete paperwork in time for the Sepetmber 30 deadline for its licences.
“Our tour operation was starting to suffer because of the lack of money available in the business and we couldn’t invest in our technology. A few years ago we were making margins of 15%-20% but these were down to 10%-12%,” added Basnett.
The business’ loyal client base were mostly mature customers who were increasingly internet-savvy and the agency was being forced to cut its margins to compete with online deals, he said.
Basnett, former chairman of travel agency consortium Elite, said the collapse had left him disillusioned with the travel industry.
“I feel very bitter about what has happened. If we had had the investment we could have ridden the storm. The industry has changed so much; it used to be so much fun. We were all partners, whereas now hotels and airlines are our direct competitors.
“It’s become so cut-throat and my enthusiasm for the industry has waned,” he said.
Forward operator bookings have been passed on to Odyssey Worldwide and the agency’s 29 forward bookings have all been protected. All clients are being individually contacted, said Basnett.
Basnett now plans to run an upmarket wine bar and pub with partner Philip Mannion, who was operations director of the failed travel business.