Thomas Cook’s sudden bankruptcy
On September 23, 2019, the British Civil Aviation Administration announced that Thomas Cook had stopped making deals, in other words, had completely gone bankrupt. This fact was a shock for the entire world community because it was Thomas Cook Company that “invented” organized tourism and became “number one” in this area. The mention of the company can even be found in the poem of Samuel Marshak of 1933, “Mr. Twister”: “There is a Cook's office abroad. If you get bored, and you want to see the whole world - the island of Tahiti, Paris and the Pamirs - Cook will prepare a cabin on the ship for you in one minute.
Actually, Thomas Cook came up with the system of all-inclusive - the first tour was organized on July 8, 1841 (from London to Loughborough). There was no "buffet" at that time, tourists received only tickets, excursions and sandwiches.
The business of the Thomas Cook Company was more or less stable until 2007, and then the company started to buy to acquire the assets. The company included a British competitor, the operator MyTravel Group, bought for 5.5 billion dollars. In 2010, the company was supplemented by the Russian Intourist, and in 2019, Biblio-Globus also entered it. However, Thomas Cook has enough affiliated companies in other countries, we will not list all of them, but we note that bankruptcy affected their customers.
Why did Thomas Cook go bankrupt?
Most probably, the reason for the collapse was a hole in the budget due to the strengthened asset acquisition policy. According to the experts, Thomas Cook owed about $ 2.5 billion. However, the company of China, Fosun, which promised to allocate more than a billion dollars, was supposed to save the tour operator, but in August 2019 the negotiations stalled. This was due to the banks demanding an additional raise of nearly $ 250 million in contingencies. As a result, the deal fell through, and Fosun issued a statement in which they expressed "deep sympathy for everyone who suffered from the situation."
It is known that Thomas Cook tried to provide additional funding and negotiated with creditors till the last moment, but there were no avail. In all problems, the tour operator blamed the unfavorable political situation in many countries, popular among tourists, for example, in Turkey. In addition, British tourists began to postpone bookings due to the UK leaving the European Union, and the weather failed - a decent portion of tourists postponed trips “until better times”. In general, Thomas Cook had enough problems.
Analysts, for their turn, believe that the company was simply not ready for the realities of the 21st century. Now everyone can be their own tour operator - people buy tickets on their own, book hotels with the help of special services, and rent cars. They do not see a need for an intermediary who will ask for additional money. In addition, Thomas Cook had more than 500 offices that also needed funds for rent and salaries of employees, while competitors moved to the online market, thereby reducing costs.
The crisis of tour operators
It is very likely that the bankruptcy of such a huge company as Thomas Cook will undermine the confidence of tourists in tour operators, thereby reducing the demand for their services - the industry may be in crisis. However, such crises, as a rule, do not last long. After some time, travelers forget about past problems and go back to package tours.
Why does it happen? Everything is simple. Yes, there are a huge number of services for self-organization of leisure, but some areas are still more profitable to take a "tour". And travelers know about it. In addition, families with children and older tourists (and there are more of them due to the increase in life expectancy) do not undertake to organize trips themselves, it is more convenient for them to take "everything ready", which means that tour operators will not be left with anything.
Another problem of modern tour operators is one-sidedness of the services offered - these banal packages to a number of classical countries, such as Turkey, Greece and Spain, plus some countries of Latin America and Asia, but very few. There are simply no offers in the number of areas. And in a century when the dream of every second progressive inhabitant of the planet sounds like “visiting the whole world”, the policy of operators, to put it mildly, is outdated. Travelers refuse from classical tour operators and organize the trips themselves or go to the companies, ready to arrange a tour, for example, to Bolivia. And the founder of a bankrupt company, Thomas Cook, supported the opinion that travel formats need to be constantly changed, offering customers interesting new types of services. He arranged tours in the holy places of Palestine, then in the literary trails of Scotland, first of all, making sure that the trips were informative and in not boring. Unfortunately, over time, his point of view has become a thing of the past, giving way to "mass tours", and from the entertainment program, travelers have only a "buffet" and hotel animation.
"Intourist" and "Biblio-Globus"
Russian affiliated companies of Thomas Cook hastened to declare that they would not be affected in any way by the bankruptcy of the forefather. Representatives of Intourist noted that their company is an independent operating organization, and it operates within the framework of the Russian legal field. The tour operator allegedly has nothing to do with the British Treasury, has its own production system, its own flight programs. This whole situation concerns them only with an unpleasant information field.
Representatives of Biblio Globus made a similar statement, noting that bankruptcy would not affect their activities, and they would continue to implement all the agreements. However, market experts agree with this. If Thomas Cook can strike at Intourist and Biblio Globas, then only in image terms. Both operators are independent legal entities, have all the necessary financial guarantees and are on the Russian register of tour operators.
But it is expected that in the nearest future the number of buyers will still decrease by 20% - people will be afraid to take package tours. And this is not surprising, after numerous bankruptcy stories (for example, Natalie Tours), people became “scared” and weigh the pros and cons 10 times before giving their honestly acquired money for a dubious ticket. However, analysts suggest that this will not last long, and soon the flow of travelers will become the same.
By the way, in fact, Intourist and Biblio Globus no longer have an owner, which means that someone will buy them in the nearest future. According to various estimates, it may be a strong competitor to Thomas Cook, for example, TUI. Or maybe a Russian buyer, for example, Sberbank - the idea of nationalizing tour operators has long been in the air. And still, big bets go to Intourist - this is a company with a history and a strong reputation, it should not be abandoned. However, Biblio-Globus has every chance of a problem-free way out of the crisis. In recent years, the operator has been very popular among travelers and has recommended its services as reliable services of high-quality.
Tourists of Thomas Cook
Some information about the tourists. After the tour operator declared bankruptcy, about 600 thousand of tourists got stuck abroad, 160 thousand of them are residents of Great Britain (the rest are from Thomas Cook’s affiliate companies in other European countries). They promised to return everyone home before October 6th. In fact, it was the largest evacuation of the British from abroad in peacetime.
Many travelers complain that they had to pay for hotel accommodation once again because Thomas Cook did not pay for it. A lot of stories about ripped weddings and meetings go on the Internet. However, the UK government promises to sort it out, bring fellow citizens home in time and conduct an official investigation on the leadership of Thomas Cook, which, oddly enough, continues to receive multimillion-dollar salaries.