U.K. agencies look to snap up Thomas Cook advisors, storefronts

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Photo Credit: Electric Egg/Shutterstock

The collapse of Thomas Cook meant the closure of its 555 brick-and-mortar travel agencies around the U.K., but the willingness of other agencies to hire former Thomas Cook employees and open storefronts in the same locations signal the strength of the overall agency community in the country.

Sean Tipton, a spokesman for the Association of British Travel Agents, the trade association for U.K. tour operators and travel advisors, said the news that agencies like Hays Travel were interested in keeping traditional agencies in former Thomas Cook locations was a good sign for the agency landscape overall.

"It was a surprise, really, because it happened so quickly, but it's also very positive," Tipton said.

The agency landscape in the U.K. shares a number of similarities with its counterpart in the U.S. Like agencies here, Tipton said, the advent of online booking hit agencies hard, especially brick-and-mortar agencies (commonly called "high street" agencies in the U.K., roughly equivalent to calling them Main Street agencies in the U.S.).

While the emergence of the internet significantly reduced the number of agencies across the U.K., those that survived tended to be very good at their jobs and true experts, Tipton said. 

Independent, home-based advisors are proliferating in the U.K., and brick-and-mortar agencies are also enjoying a resurgence, according to Tipton.

Thomas Cook’s trouble was "more to do with the large amount of debt that they accrued through various acquisitions, and that brought the whole group down in the end," Tipton said. He said he believes other agencies are interested in the company's brick-and-mortar locations because they were doing well.

Hays Travel announced earlier this month that it would not only acquire Thomas Cook’s 555 shops, but also hire up to 2,500 Thomas Cook employees. Of those, 100 would be based at Hays' headquarters in Sunderland, England.

Before the official announcement, Hays had already offered jobs to about 600 former Thomas Cook employees.

John Hays, managing director of the agency, issued a statement saying, "Now that we are able to reopen the shops, we are looking forward to welcoming many more people who share our passion for the travel industry into our family business."

Last week, Hays was in the process of reopening former Thomas Cook storefronts and bringing the former employees back onboard. As of last Wednesday, Hays reported it had opened 186 locations in England, Scotland, Northern Ireland and Wales and had hired 1,982 former Thomas Cook employees.

Peter O'Connor, Phocuswright's senior market analyst for Europe, agreed with Tipton that the agency side of Thomas Cook's business wasn’t the problem but rather that operations were challenging. He called Hays' efforts "a strange move," as the company already had many agents of its own. Before it began reopening Thomas Cook storefronts, Hays had 190 brick-and-mortar locations in the U.K.

Dirk Rogl, Phocuswright's research analyst and content specialist for Europe, agreed that if the deal was undertaken just for storefronts and agents -- and not for customer data, which is generally not for sale due to EU data protection laws -- it is "unusual indeed."

Hays isn't the only agency with plans to pick up what Thomas Cook left behind. Several others are interested, Tipton said.

Among them is Barrhead Travel, a Travel Leaders Group brand with 76 stores and headquarters in Scotland. Barrhead said in a statement that it planned to open as many as 100 new stores in the U.K. and to rehire "a significant number of former Thomas Cook employees as quickly as possible."

Travel Leaders acquired Barrhead in early 2018. Travel Leaders chairman Michael Batt said expansion plans had already been in the works but were accelerated in the wake of Thomas Cook's collapse.
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Christina Jelski contributed to this report.

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