Advice for Travel Agent Businesses

Rescue, Recovery, and Closure Options for Travel Agents

While the worst of the disruption caused by the Covid-19 pandemic may now have passed, the effects of this incredibly disruptive time are still having an impact on travel agents - and the entire travel industry - across the country.

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Challenges Facing Travel Agents

For an industry already struggling to maintain its position in a landscape where travellers and holidaymakers increasingly book their trips online, there are now ongoing issues with cash flow caused by the disruption to trade during the pandemic to contend with, coupled with an uncertain global economic outlook which threatens to affect businesses across almost every sector and industry imaginable.

During the height Covid-19 restrictions when there was little other option than to subsist on government-supported fiscal packages including furlough payments for staff wages and various loan schemes, many travel agents took out sizeable Bounce Back Loans or CBILS borrowings in order to keep the business afloat financially. While these loans served a purpose at the time and helped save many from closure, travel agents now face the reality of carrying this borrowing with them for a decade, all the while making monthly repayments toward these loans which will eat into monthly income and threaten to hinder cash flow.

Understanding Insolvency for Travel Agency Businesses

As with all businesses, a problem with cash flow can quickly escalate and if the problem is not addressed swiftly the company can soon be at risk of becoming insolvent. The good news is that there are a range of options available to you and your company should it experience financial difficulties. Emergency funding may need to be injected into the business to allow outgoings and other liabilities to be paid on time. In other cases, however, piling additional borrowing on top of an already indebted company is a recipe for financial disaster. Instead, the company may need to consider a more formal arrangement with creditors to help reduce the immediate pressure.

If you are in this position, a licensed insolvency practitioner will be able to talk you through your options and give your travel agency the very best possible chance of effecting a successful turnaround.

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Rescue, Recovery, and Liquidation for Travel Agents

In spite of the difficulties being faced, the situation for travel agents is far from being all doom and gloom. While it is no doubt a challenging marketplace to operate in, the opportunity is still there to run a financially successful travel agency business, however, modifications as to how the business operates and how it is financed may have to be made. The desire for travel will always be there, however, changing consumer preferences may require travel agents, particularly those based in bricks and mortar stores on the high street, to have a plan in place to accommodate these shifting expectations.

If you are concerned about what the future holds for your travel agency business and fear there is a chance of the company falling into a state of insolvency, the experts at Real Business Rescue are here to help. At Real Business Rescue we can ensure travel agents and other businesses operating within the travel industry, are armed with a robust yet flexible strategy, providing the solid financial foundations needed while allowing for agility as the marketplace evolves over the coming years.

We can discuss the full spectrum of possible solutions including financial restructuring, securing additional funding, or company closure options if the business’s problems have taken it beyond the point of rescue. To arrange a confidential appointment with a travel industry business turnaround expert, get in touch with the Real Business Rescue team today.