Dame Irene Hays has hailed “exceptional performances” by members of the Hays Travel Independence Group but warned of some “gloomy” economic hurdles ahead.
She said the UK’s economy is forecast to decline in the coming months and there will be limited growth in the market until 2025.
“We are in a very challenging environment and a thin margin business,” she told delegates at the group’s annual overseas conference, being held in the Algarve.
She said the National Minimum Wage will increase in April by 9.7%; business rates will go up by 5% in the same month and energy bills are surging.
However, there are “immense” opportunities as most people are still determined to spend money on holidays this year, she told delegates.
“Older and more affluent consumers expect to spend more,” she said, pointing to the luxury, cruise and long-haul markets as areas on which to focus.
She advised IG members to target profitability and their product mix, taking advantage of market trends such as a predicted 36% growth in cruising over the next three years.
“Cruise lines are desperate to sell those holidays,” she told delegates.
Natasha Marson, head of Hays Travel IG, noted how some members had hit the headlines in the trade press with strong performances in January and February, such as Not Just Travel and Holidaysplease. She also said that Miles Morgan Travel has seen 13 consecutive record-breaking months.
Hays IG accounts for about 20% of Hays Travel’s overall business, with retail taking a 45% share. Foreign exchange is about 19% while the in-house tour operation is 7%. Franchise accounts for 5%; homeworkers for 3%; and 1% comes from its contact centres.
She said IG had been outperforming retail in the peaks, accounting for 26% of business in January compared to its average of 20%.
Furthermore, 91% of IG members exceeded their January 2020 performance in January 2023, while 32% have doubled their performance.
Marson highlighted opportunities in cruise, luxury long-haul and ‘bucket list’ trips, as well as foreign exchange sales.
Claire Gibson, head of commercial, highlighted suppliers that were offering enhanced commission rates, as well as the earning potential in the touring and adventure sector.
About 80 IG members were at the conference along with 42 supplier delegates.
Marson commented: “The suppliers’ trade exhibition has been brilliant, the members have certainly enjoyed this more than previous years.”
Dame Irene recalled how she and her late husband John Hays had formulated the plan for Hays IG more than 30 years ago while sitting at their kitchen table.
They had helped one agent turn his business around from a loss-making company into one that was profitable, and realised they could do the same for other agencies.
“Hays Travel focuses on helping members be the most profitable they can,” she said.