Fred Olsen Travel reports cruise sales swing due to domestic sailings

Fred Olsen Travel has been its ratio of bookings swing to domestic UK cruise as agents push to sell what they can this summer as the industry awaits news of quarantine-free travel to amber list countries.

Head of commercial Paul Hardwick told a Travel Weekly webcast that “trading is still tough” and that: “We haven’t seen a big surge in overseas holidays since the green list additions. It just hasn’t really transpired yet.”

But he said the UK domestic cruise sales were “doing really well” with the ratio of cruise sales jumping from a traditional 50:50 to 70:30 in favour of cruises as a result of what’s available in the market. “It definitely seems to be the one that’s winning out,” he explained.

More:Fred Olsen Travel acquires Worldspan Travel

Hardwick said he had his “fingers crossed” that transport secretary Grant Shapps will deliver some positive news with the introduction of quarantine-free holidays from amber list countries later this week – with an earlier introduction of the policy being a “game-changer”.

But he warned a surge in bookings “might not be immediate” however he believes the resumption of events in the UK – such as the Euros and Wimbledon – have helped to improve confidence of people to travel and get back to “normality” which “has been a long time coming”.

“We had one of our best weeks last week for a while and that’s just the mood of the country starting to change. But in general terms we are still trading at about 40% of what we would usually be doing about now.”

Hardwick added: “Quarantine is a massive no-no from our customers. They just don’t want to do it. They also need some simplicity. It’s too complicated at the moment.”

He said he hasn’t booked any holidays himself because “I don’t want the disappointment of seeing it cancelled”, adding: “That’s what we’re seeing across all of our customers. They want to go away, but they want that assurance it will actually happen. That’s the thing that’s really holding them back at the moment.”

He said about 70% of business has been for 2022 onwards, explaining that customers have “got that hope that by then we’ll be back to normal.”

But he stressed: “For travel businesses though we’re desperate to sell for this year because we need that cash to help regenerate the business, especially as the furlough scheme starts reducing and ends later in the year.”

Hardwick noted a lot of customers moving holidays to next year when it comes to their balance due dated, but pointed out: “Those people have still got money to spend this year, if they can go away.

“It might not be July, or even the beginning of August, but September has always been a really popular month for us and even if we can just see decent levels of overseas holidays going in September, October and the winter, then we can still see some good levels of income.”

He said the business would “keep using the flexi-furlough as much as we can” but: “If business is rebounding we need to make sure we’re adding staff to make sure we maximise that.

“We can’t control the market, but what we can control is the share of the market. And if customers start coming back we’ve got to make sure we’re maximising that.”

He explained how his staff had been downbeat about having to process so many rebookings over the last 15-16 months but said green shoots of optimism were beginning to come through in the shops.

“As they’ve started seeing cruise ships go back out, passengers go away on holidays, passengers come back and say positive things, they’re starting to see that love again and think ‘I’ve done a sale and it’s generated a fabulous holiday’. That’s why they’re a travel agent and that’s what they’re hoping will come off at a bigger scale in the coming months.”

Hardwick said being “open and honest” was the key to maintaining staff morale, and updating them on the business’ plan for coming weeks.

Cruise trend

Hardwick reported that “a lot of non-cruisers” were booking the UK domestic sailings, as well as loyal cruise customers at the agency, which specialises in the sector and shares a name with Fred Olsen Cruise Lines.

He said the agency’s franchisees and homeworkers in particular have had “huge success” at selling domestic cruises to new-to-cruise customers this summer from the family market “who traditionally would’ve been going over to Spain”.

He said shops have been “different customers” to usual in recent weeks. “We used to sell predominantly to the 60+ age group. That’s come down over the last 6-8 months. The 40-50-year-olds are starting to come to us because they don’t want to book direct, they don’t want to book online anymore. They want that reassurance of someone to help them.

“Why wouldn’t you book with a local agent when you’ve got people with experience, with knowledge and the security that you can talk to? I’m sure every agency in the country has been working hard so – even without any cash for the last 18 months – to service those bookings.

“It will be rewarded. I’m certain of that.”

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