Why Flight Centre is still number one: Skroo

Why Flight Centre is still number one: Skroo

Flight Centre released its Annual Report for the last financial year on Friday, with Graham ‘Skroo’ Turner putting his two cents in about the future of the business.

It’s no secret that the travel agency leads the way in Australia, but there’s no point resting on your laurels, with Skroo outlining a number of plans to remain on top.

“Flight Centre sees solid growth prospects globally and will target an underlying PBT between $380 million and $395 million for the year to June 30 2016,” Skroo said.

“Our dual position as Australia’s largest travel retailer and Australia’s largest corporate travel manager is well known, but we are also now the major player in several niche sectors that are growing rapidly globally.”

“For example, Student Flights (targeting students and backpackers), Travel Money (business to consumer foreign exchange) and Cruiseabout (ocean and river cruising), are all the largest businesses of their kind in Australia in terms of shop numbers. Together, these three businesses turned over almost $1.2 billion in Australia.”

“Flight Centre has generally maintained strong market-share within the key leisure travel sectors that it has focussed on in Australia. The company has also recently taken steps to increase sales in sectors that have previously offered low or no margin and have not, therefore, been priorities.

Skroo added that flight Centre plans to “close gaps” in its online product range through a number of avenues, including:

  • Adding Air Asia and Tiger fares to the website, along with additional Jetstar inventory and ancillary products
  • Introducing an accommodation aggregation tool that will draw from a range of databases to give customers access to some 400,000 properties globally.

“We see growth opportunities online as part of our blended offering and by targeting customers who prefer to transact online. As a result, the web will be incorporated into the person-to-person sales journey and online brands will be developed or acquired, if viable, to target sectors that have shifted online.”

Skroo added that he believes “we are at the beginning of a Golden Era of Travel,” with Flight Centre paving the way and building the foundations required to seize maximum opportunity.

The ‘Golden Era’ will be characterised by cheap airfares, more choice, greater luxury and comfort, and less flying time.

“This is a Golden Era of Travel. Why? I think it is pretty obvious,” Skroo said at the Flight Centre Global Gathering earlier this year.

“There is so much choice – of experience, in adventure travel and in flights – and there’s never been better value. Airfares have never been cheaper.

“When people travel today, they typically want more than just a beach holiday or a hotel stay. They also want an experience – they want to learn and be educated about the destination.”

“One of the other things that we must do in our leisure and corporate businesses – and we already do it well in some – is be closer to the customers. So the same consultant – the same person – deals with the same customer and that customer comes back to his or her consultant person-to-person, year after year.

“It has to be more than a brand to customer communication in the way we market to customers. It has to be person-to-person.”

The big things to look out for in 2016

  • The opening of a flagship store in Sydney, next to the Hilton Hotel on George Street during the second half of the year, set to become Flight Centre’s largest shop globally.
  • Greater profit and sales contributions from off-shore
  • Market growth as the Golden Era continues. IATA has projected 4.1% compounding annual growth in passenger numbers globally through to 2034, while Airbus recently predicted that international traffic serving the Australia South Pacific region would grow 4.5% per year to 2033.
  • Ongoing network expansion, with Flight Centre aiming to expand its global sales network by 6-8%, which will see the company create more than 1000 new jobs.
Image: Flight Centre

Email the Travel Weekly team at traveldesk@travelweekly.com.au

    Latest comments
    1. Flight Centre have been laughing all the way to the bank for the last 3 years since the JTG board appointed Rob Gurney as CEO who then spent $20 Million on consultants who told him to change the name to helloworld and close a $200 Million online profitable online operation, Best Flights. The combined losses that helloworld, their board and executives have racked up in this time adds up in the hundreds of millions, and getting worse.The likes of Flight Centre, Magellan and Webjet have just sat back and laughed at them. The few branded helloworld high street agencies left are all queuing up to leave as soon as thier franchise agreements run out, including me.

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