A survey undertaken by the Advantage Travel Partnership of its members has revealed “significant challenges faced by independent travel agencies”.
The consortium canvassed its members to find out the impact of the Budget announcement on October 30, ahead of Small Business Saturday on December 7.
Members reported increased operational costs across multiple areas, with primary concerns including rising staffing costs, complex tax implications and a hike in national insurance contributions for employers, alongside the impact of increased Air Passenger Duty (APD).
The survey findings also indicate a shift in consumer behaviour, with agencies noting increased caution in client spending patterns, partially attributed to the recent Budget measures.
The fiscal changes are expected to have substantial cost implications for travel businesses across the sector, warned an Advantage spokesperson.
Looking ahead to 2025, members identified several “critical challenges” facing their businesses.
These range from cash flow management and geopolitical concerns in regions such as Russia/Ukraine and the Middle East, to ongoing recruitment difficulties and evolving tax implications.
The Advantage spokesperson added that small businesses in particular face mounting pressure to maintain profitability while managing increasing overhead costs.
In response to these challenges, Advantage members are already implementing various measures, including recruitment freezes and targeted cost-reduction initiatives.
Julia Lo Bue-Said, chief executive of The Advantage Travel Partnership, said: “We knew from the outset that many of the changes announced as part of the Budget would impact our sector.
“This survey has provided crucial insights into the real challenges our members are facing and their concerns for the future.”
Lo Bue-Said added: “While our travel agency partners are implementing strategic measures to navigate these budgetary challenges, this Small Business Saturday serves as a vital reminder of the importance of supporting local businesses.
“Despite strong outbound travel demand and robust booking patterns for 2025, it’s clear that business owners across all sectors are facing mounting pressures from multiple directions, creating challenging decisions between immediate survival and long-term growth.”
The survey follows similar comments made by Kate Nicholls, chief executive of UKHospitality, who said the Budget would halt growth in the hospitality industry, warning that 2025 is set to be a “painful” year for the sector as a result of rising costs.