The Hays Travel Independence Group met this week in Tunisia. Ian Taylor reports
One of the industry’s biggest independent retailers declared “real evidence for optimism” in consumer demand for holidays this week.
Hays Travel managing director John Hays told the Hays Independence Group overseas conference in Tunisia: “We’ve had 16 months of overall growth in commission earned. That is 16 months of solid trading.”
He reported commission earnings at Hays Travel up 11% over the past year and told Travel Weekly: “That is an 11% increase in revenue right across the retail business.”
Hays said: “Last year I told the conference I saw signs of optimism. Now I’m much more optimistic. We are not seeing much in the way of increasing volume, though it’s not negative. But transaction value is up significantly.
“People are spending more. They are not booking more holidays and may even be travelling for shorter durations, but they are spending more when they do go away.”
Hays stressed that he believed their were signs of a genuine economic recovery in the UK.
“This looks like a sustainable recovery. Inflation is lower and there is a desire to spend. People are not piling on debt.
“Inflation is looking more subdued and it is not a debt-fuelled recovery. The confidence in the sector is shown by people being willing to buy businesses.
“The Thomas Cook share price has clearly recovered. Shoppers have opened their purses and there is genuine optimism.”
He added: “I’ve put my money where my mouth is by buying Bath Travel. There is real evidence for optimism, although there is still lots that could blow us off course.”
Hays announced the acquisition of fellow independent Bath Travel last month, taking the combined retail business to more than 100 outlets.
All change – and all remains the same
Bath Travel shops will switch to the Hays Travel sales system at the start of December in preparation for the January peak-sales period.
Sunderland-based Hays bought southern-based Bath in October for an undisclosed sum, in a deal where Hays managing director John Hays pledged to keep Bath Travel’s management and ethos.
He told Travel Weekly: “We’ll keep the Bath Travel brand – to lose it would be unthinkable. But two different selling systems don’t make sense.
“So from December 1 we’ll standardise on the Hays system. It was an easy decision because there was no affection for Bath’s system. There is a race to train 360 staff as we need it ready for January.”
Hays added: “Bath has real quality management and lots of experience. The company is known for its knowledgeable staff. I heard one staff member took a party of 99 to China to watch a solar eclipse last year. Another escorted a group to Peru.
“People are really embracing the new structures. Morale seems really good. The commercial teams are working well. I’m pinching myself with delight at the moment.
“Bath can bring a lot to Hays. We are trying to take the best of Hays Travel and best of Bath and combine them. Hays Travel might have to change a bit.”
Success of in-house tour operation boosting margins
Hays Travel reported booming sales of its in-house Hays Faraway product as it seeks to boost retail margins.
Long-haul bookings doubled over the past year as Hays Independence Group members surpassed a target of 25% of long-haul sales with Hays Faraway – hitting 27% this year.
Hays Travel managing director John Hays said: “We aimed to get the transaction value up and increase the amount of long-haul bookings, and we set a 25% target for our own product.
“We’re a retailer and want to stay a retailer, but we need to control our destiny. That is why we made the decision to develop our own bed bank and transfers and set up a long-haul tour operation. We doubled the number of long-haul bookings over the past year – 27% of all non-EU destinations were in-house. So we’re delighted with Hays Faraway.”
He insisted: “We don’t want to be a Tui Travel or Thomas Cook. It was a strategic decision and the strategy is working.”