Travel agent consolidation may be a real consequence: Weekly Trips| Instant News

Although it is not possible to predict the full impact of
The coronavirus crisis on travel agents, most observers expect consolidation,
similar to what happened after 9/11 and the flight commission cut it
began in the mid-1990s. Bob Joselyn, president and CEO of the Joselyn Consulting Group,
have heard from agencies interested in combining operations to reduce
on costs such as rent and staffing. When coronaviruses began to spread, Joselyn said, he
believe about 25% of travel agents will not survive. Now he believes
20% of U.S. agents will be closed and 20% will come out of the crisis in a
different forms – may be merged with other agents or acquired by others
agent. Josephelyn, who helped institutions work through this problem,
described his work as helping clients “fail gently.” On the other hand
pandemic, the agency will not look like before, but it will still enter

“At least there will be no meaningful income
the second quarter of 2021, I think, and even then, 2021 will not be seen
like 2019, “he said. “The brutal fact is, they have to find out how
they were financially safe until they passed the end of the tunnel. “Even though the coronavirus has stopped most forms of travel,
there are buyers who are interested in getting an agency. Innovative Travel Acquisition CEO Robert Sweeney said a number
agents have used pauses on their way to re-evaluate their business. “Industry will definitely reshape,” Sweeney said. “There
fewer brick-and-mortar agents. Some people will stay away
rent. Other leases will only end naturally. “Innovative has a list of about 20 parties sought
potential acquisition. Their source of liquidity is different by the buyer, Sweeney
said, but one, for example, is a private equity company that sells a majority
company in January and February. Others come from outside the trip
industry and are interested in a deal. Most want intermediate agents. “The market has shifted from the seller’s market in February to a
buyer’s market, “he said. The current environment needs some creative agreement,
according to Sweeney. In many cases, he expects smaller down payments,
then the “two bite of apples” approach, where the buyer pays a portion
purchase price after closing 2021 and the second part at the end
2022. “If you have built a good agency and it really bounces
back pretty good in 2021 and very good in 2022, you can still have the same
[aggregate purchase price] You will have it if you resell it in February, “he said
the word. Consolidation brings a number of benefits, Jack said
Mannix, founder and principal of Jack E. Mannix & Associates: better
economies of scale, less brand confusion in fragmented and better industries
leverage for supplier negotiations. For these reasons, he said he would “virtually.”
guarantee “further consolidation. With regard to the pandemic, consolidation also appears to be minimal
sweeter for many people because of the associated cost savings, he said. It might even help some companies come out stronger
the other side. If an agent is not interested in consolidation, the costs are possible
reduced by streamlining operations to be stronger on the other side
side. That is the hope at Internova Travel Group, previously Travel
Leaders Group, which recently announced a major brand overhaul and
reorganization efforts. CEO of J.D. O’Hara said one of his goals was to “accelerate
recovery. “” When the journey begins to recover, we will be at the strongest
a position that has never existed and provides our advisors and agents
with maximum support and service in return for profitability, “he said.

image source

to request modification Contact us at Here or [email protected]