NEWS TRAVEL WEEKLY BUSINESS CONTINUED FROM THE BACK


From a regulatory point of


view, Lewis claims the industry is more robust than ever following lessons learned after the 2008 economic crash and the failure of XL Leisure Group, the industry’s biggest collapse. But although he regards it


as consortia’s role to put in place processes for members to mitigate risk and to provide support when things go wrong, Lewis expects agents will continue to be exposed to the risk of working with some suppliers. He said commercial reality


means agents will always take product from suppliers like Lowcost, whose business models ultimately prove unsustainable, because they have to compete on price. And he believes agents are


actually the main beneficiary of the sort of cut-throat marketplace that the likes of Lowcost encourages. “I think the more competitive


and entrepreneurial the market, the more that drives down price and, while that has commercial risk, the beneficiaries are those who have the relationship with the customer. That can only be great for our members. “If you have the ability


to put the systems in place to make sure agents do not have to worry about those commercial risks but bring those prices to them, they can reap the benefits. By being more than just a commercial and marketing team we are underwriting their risk. “I’m not talking about partners committing commercial suicide. We want long-term sustainable relationships with partners and members. But if the rest of the market is buying off Lowcost because they are making crazy decisions to be the cheapest, that’s part of the market we cannot govern or regulate.”


Barrhead appoints BDO to speed search for investors


Lee Hayhust lee.hayhurst@travelweekly.co.uk


Barrhead Travel confirmed it is seeking investment to expand as it reported a 66% leap in profits last year on 2014.


The leading travel agency in Scotland, Barrhead has engaged business services firm BDO to identify an investor or investors. The company reported turnover up £21 million to £267 million in the 12 months to December 2015. Barrhead opened a flagship


store in Newcastle last year – its first shop in England – and has said it is eyeing opportunities as far


south as Bristol and Southampton. Travel Weekly reported in May that the company was considering seeking external investment to support its growth plans. The timing of the results an- nouncement, a month earlier than last year, and BDO’s appointment indicate the process is under way. The company attributed


MUNRO: “I’m delighted with our results in a difficult trading year”


“We’re introducing virtual reality headsets in stores and plan to add an online portal”


its growth to “investment in technology, shop openings maturing, long-haul and cruise sales increasing, [and] improvements to websites”. Barrhead plans to open two


more stores in England this year. Chief executive Sharon Munro said: “I’m delighted with our


results in what was a difficult trading year. We have exciting plans for the rest of the year: we’re introducing virtual reality headsets in stores and we’re about to launch a new online portal providing a secure space which will allow the Barrhead team to deliver a personalised service.” A BDO spokesman said: “We’re


excited about working with Barrhead to secure investment for the next stage of its growth. Barrhead will launch a high-tech


training academy in Glasgow city centre in September.


COMMENT: NO ONE KNOWS HOW BREXIT WILL PAN OUT


By Andrew Monk, chief executive, VSA Capital


When a company releases an announcement and blames Brexit, it’s using Brexit as an excuse. When an airline reports lower profits or a lowered outlook and blames Brexit, it is not quite telling the truth. To suggest an airline would locate new


aircraft away from the UK due to Brexit


is baloney. What is driving leisure


travel issues at the moment is the collapse of holidays to the eastern Mediterranean. Brexit was not just a protest vote – the percentage tells you that. Many, including myself, believe the real problem lies in Europe, and there is a probability of further countries leaving. I believe we’ll see Europe in some serious trouble, starting with the banking system which is in a parlous state. Our airlines are some of the


strongest globally, our travel companies also, and we have some of the most experienced and capable staff.


What we desperately need is


more runway capacity, for two reasons: growth is being stymied by the inability to fly more routes, particularly to Asia, and a major infrastructure programme will bring jobs and growth. Heathrow is the business airport, so there is no question the additional runway should be there. Gatwick is a leisure airport. The weakness of sterling is being blamed for many things, but the currency was at this level in 2010 and 2012. It may be more expensive to holiday abroad but it brings more tourists to Britain.


62 travelweekly.co.uk 18 August 2016


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