The trade is witnessing a “significant” shift post-Covid towards the managed service travel agency model, according to Abta chairman Alistair Rowland.
Rowland said more agencies are joining the largest and most powerful groups offering this model to tap into their commercial terms, merchant services, bonding rates and Atol.
The model frees up agents to concentrate on sales while back-office administration, including supplier payments, is run by the parent. Customer monies are usually ringfenced in a trust.
Several brands offer managed service models, including Hays Travel Independence Group, Brilliant Travel (Barrhead), Midcounties’ The Co‑operative Travel Consortium and Advantage Managed Services (AMS).
Rowland stressed a reduction in Abta members was not necessarily down to “members going bust or leaving Abta” but instead reflected a move to managed service models, in which members trade under the parent company’s Abta number.
In 2019, there were 1,106 Abta members, counted by head offices rather than branches. In 2021,
there were 928.
Rowland said: “A big part of the reduction in overall Abta members is a move by independent agents to join a more powerful parent. Both new and established agents are moving to the managed service model.”
The Advantage Travel Partnership reported a clear shift, with about 85% of new members wanting to join AMS. Of Advantage’s 600 branches, about 75 are AMS, with two to three joining per month.
Leisure director Kelly Cookes said: “I can see a time when it’s level or overtakes the number of traditional members.”
In the past, managed services was often seen as a model for new businesses or members, she said.
She said: “Prior to Covid, agencies would not have highlighted they were in this model, but they are now because of the trust account.”
Current problems such as recruitment and administration were making managed services more attractive, she added.
Hays Travel IG also reported a “significant spike in interest” during the pandemic, and said “this hasn’t slowed down yet”. Head Natasha Marson said newcomers sought “peace of mind, security and, in some cases, financial support”, while established agents wanted the benefits of Hays’ commercial deals.
Linda Pyle, director of Brilliant Travel, said: “We’ve noticed an increase in enquiries recently for our Managed Service Travel Partner offering. Even over the last 12 months, we’ve onboarded new members – mainly experienced travel professionals who were looking to take the next step in their careers. We expect interest to remain high and are anticipating the onboarding of a number of new members during 2022.”
She added: “There’s no real pattern for those exploring the idea of becoming an MSTP: some were made redundant during the pandemic and are returning to the industry, some have experience of being an independent homeworker and others are setting up as a family business.
“What they are looking for is stability, reliability and a network that can provide them with excellent commercial deals, administrative support and access to Atol licensing.”