Travel Agents

Flight Centre responds to claims its retail network is “losing relevance”

Flight Centre has hit back at claims its retail network was “losing relevance”, asserting that the challenges of post-COVID travel will highlight the need for travel experts.

Brian Han, a market analyst for Morningstar, has predicted that Flight Centre’s leisure business faced a long-term decline as consumers increasingly turn to online and direct bookings.

Han said Flight Centre’s retail network was losing relevance after almost half its roughly 1,000 brick and mortar stores closed in 2020.

“Flight Centre has a strong network of services that has driven solid end-user traffic and bookings over the past 20 years, but we do not believe this is sufficient to protect the company against online competitors over the next 10 years,” Han said, according to the Sydney Morning Herald.

A spokesperson for Flight Centre told Travel Weekly leisure would continue to play a “crucial role” in the company’s future.

“While we made some changes during the pandemic, we have maintained a very strong leisure network that incorporates multiple channels for customers,” the spokesperson said.

“This network is underpinned by an extensive retail shop footprint that remains highly accessible and it also includes websites, call centres and a growing stable of independent contractors.”

The spokesperson said Flight Centre expected these new channels to capture a greater share of its earnings, with online now generating about 20 per cent of bookings, which is more than double the eight per cent the company saw before the pandemic.

Han also said Flight Centre’s bargaining power was likely to erode against airlines when negotiating commission rates, with international travellers seen to be the most likely to book direct.

Flight Centre’s managing director, Graham ‘Skroo’ Turner, told the Sydney Morning Herald that except for a few larger airlines, he expected fierce competition would force carriers to pay the same commissions.

However, he admitted Flight Centre would be increasing its online presence, which it had already begun to do before the global pandemic began.

“We are shifting business more into online, and when you look at places like the UK, North America and Europe, we have a significant leisure business but still a very small market share and we’re looking at growing that,” Turner said.

Han said Flight Centre’s continued success in its corporate travel business would give the company enough liquidity to ride out the pandemic.

Travel will be more complex post-COVID and this will really highlight the value expert travel advisors add,” the Flight Centre spokesperson added. 



SEE WHAT PEOPLE ARE SAYING

Leave a Reply

Hotels

Tiny Away opens up mini Tassie getaways

Tiny Away has opened the doors to its first Tasmanian tiny houses, growing its network of rural getaways. The ‘Quirindi’ […]

Share

CommentComments

Tourism

Colorado Tourism Office say G’day to the industry

The Colorado Tourism Office joined media and travel titans last Friday at Bentley’s in the Sydney CBD to reconnect with the Aussie travel industry.

Share

CommentComments

Aviation

Bonza calls on Aussies to name its first plane

Some of the names suggested so far include Purple Rippa, Bonza Bruce, and Kimbo. We challenge you to come up with something more Aussie sounding than that!

Share

CommentComments

Aviation

Qantas increases international connection time to reduce mishandled baggage

The upside of all these missing bags is that you no longer have to sprint through the airport to catch your connecting flight. Although we’ll miss the rush.

Share

CommentComments

Events

Missed the Visit USA Expos? Fear not, we’ve got your biggest questions covered.

by sponsored by Visit USA Australia

No more FOMO! These hot tips will get you in top-tip shape to visit the USA.

Share

CommentComments

Travel Agents

TravelManagers’ TCF Launch Applauded by PTMs

by Sponsored by TravelManagers

We hope you’re an AL (acronym lover), because this headline has plenty to go around!

Share

CommentComments

Tourism

G Adventures to relaunch Bhutan trails

These trails are kind of like the Bondi to Bronte walk, except completely different in almost every aspect.

Share

CommentComments

News

Industry movements: New hires at Intrepid, TravelManagers, Silversea and more

Keep tabs on all the latest movements in the industry, find who you need to shmooze at the next networking event and suss out all the latest gossip right here.

Share

CommentComments

Cruise

Coral Princess brings cruising back to Newcastle

Cruising has returned to Newy, marking more opportunities for the locals to hang out by the water and wear thongs.

Share

CommentComments

Hotels

Soneva introduces cryptocurrency payments at its resorts

This new update could mean that other travel companies may soon accept crypto, and then someone may finally buy our Travel Weekly NFT!

Share

CommentComments

Tourism

Paul Hogan gets top Tourism Australia honour

Hogan was reportedly quite happy with the award, but quietly disappointed that it wasn’t a knife which he could compare with his larger knife.

Share

CommentComments

News

Jucy to expand rental car fleet with $40m worth of new inventory

Jucy is a vehicle rental operator, not the company that makes those pink velour track pants, in case you were also a bit confused.

Share

CommentComments