High street revival as consumers ‘reject OTA poor service’

Barrhead Travel claims quality retail locations are seeing a revival as customers in the digital age reject online travel agents due to customer service issues.

The Scottish agency’s optimistic outlook for bricks and mortar stores was included in its 2015 full-year accounts posted on Companies House last week.

Sharon Munro, Barrhead chief executive, said “upmarket, quality” holiday bookings are made face-to-face “with people”, even if they are researched online.

In her review of the business, she said “good retail locations are again becoming the way forward, as there is a resurgence of customers wanting the security of dealing with a trusted brand”.

Barrhead last year opened its first store in England, a flagship property in Newcastle.

Munro said: “The phone, visit or click approach is working well and this is undoubtedly the way to retain clients and transact sustainable business.

“Many travellers are now rejecting online travel agents because of service issues.”

Barrhead’s full-year trading figures showed a leap in operating profit from £1.76 million to £3.03 million. They were announced earlier this month when it was revealed financial advisory firm BDO had been asked to seek investment to spur further growth.

Gross sales value increased by 8% year on year to £266 million; commissions earned rocketed by 14% from £15.8 million to £18.1 million; and sales of its own tour operations rose by £3.5 million to £68 million.

Barrhead’s gross profit margin of £30.03 million was up 9% and the firm made 11.3% gross margin on total sales, a slight improvement on 2014. An increase in the cost of sales, which includes marketing, from £76.9 million to £92.4 million reflected increased revenue.Barrhead’s cash reserves improved by £6.6 million to nearly £18 million.

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