If you stop at “44 travel” in Munich in the late afternoon, you will find yourself in front of closed doors. The travel agency is currently only open from 10 a.m. to 2 p.m. “The current situation is as good as this,” says Managing Director Andreas Radeck. He doesn’t see a travel boom in the summer of 2021. Instead: Lots of customer uncertainty and a wave of cancellations on trips to Portugal as the country has been classified as an area of. viral variants at the end of June.
The corona pandemic has hit travel agencies hard. The situation has not yet eased. Business expectations were worse in July than in June, according to a survey by trade magazine fvw with consulting firm Dr. Frit. Only 47 percent of companies assume their situation will improve in the next six months (June: 54 percent). And 23% even fear a deterioration. According to an ifo survey, 68% of travel agencies are still worried about their existence.
“Not all will survive this crisis,” said Marija Linnhoff, president of the association of independent travel agencies. Linnhoff expects an impending wave of bankruptcies. Travel agencies earn their money from the commissions of the organizers for their offers. The amount of the commission is usually between six and twelve percent of the total price. The problem: If the reservation is canceled, the travel agencies do not receive anything despite the work they have done or receive a maximum commission on the cancellation fees.
Travel agents have a lot more effort and risk
The risk of clients not taking planned vacations has increased multiple times due to the corona pandemic – as has the additional expense for counseling. Customers no longer just want to know where to find the best swimming beach in the Portuguese Algarve or the most family-friendly hotel on the Italian Amalfi Coast. The questions regarding entry and exit regulations, quarantine rules and the infection situation in the various holiday countries are much more urgent. Keeping up to date with the latest developments is a major achievement for travel agency staff, also because the situation is constantly changing.
“We really go over every detail with the customer,” says Thomas Engel, owner of the travel agency TM Reisen in Heusweiler near Saarbrücken. “We have to do it, otherwise we won’t have a reservation at all at the end.” Marija Linnhoff of the Association of Independent Travel Agencies is furious. “For 14 months, we have been fighting for tour operators to pay a flat rate per transaction,” says Linnhoff. “We have offered 75 euros. All the organizers refuse to do so.”
The organizers have another idea to cushion the increased need for client advice and the risk of cancellation: the advice fee. In the fall of last year, DER Touristik was the first group to introduce service fees in its 500 travel agencies. Tui followed suit in May and is also paid for his advice at the group’s 400 agencies. “Our first experiences with her are positive,” said a spokesperson for Tui. Customers are more than willing to pay for a consulting service. According to the group, large travel agencies should move forward with the fees so that smaller ones can follow suit. “We assume this will become a market standard.”
Thomas Engel from TM Reisen near Saarbrücken does not yet want to know anything about consultancy fees. He has many clients, 85% of whom were with him for the first time in June. Engel sometimes worked 12 to 13 hours a day. Some clients tell him that they have regularly pre-booked at a group’s agency, but that they do not wish to pay any additional fees.