Budget Travel job cuts announced

mikedragon32

http://www.irishtimes.com/newspaper/breaking/2009/0814/breaking59.htm

Budget Travel to cut 95 jobs
CHARLIE TAYLOR
Ireland’s largest tour operator Budget Travel has confirmed that it is to cut over a third of its workforce over the next few months.

The company said this afternoon that it is intending to close up to 14 of its 31 retails stores with the loss of about 75 jobs. A further 20 or so jobs are to go at the operator's head office.

Budget, which was established in 1975,* company currently employs 266 people. It claims to have a 35 per cent market share of the Irish package holiday market.

The company has begun a 30-day consultation process with staff to discuss plans for a ”very significant” restructuring of the business in the coming months.

Speaking this afternoon, Budget Travel's chief executive Eugene Corcoran said that there was a need to reduce the business's cost base while becoming more flexible in order to better respond to customers.

"We need to restructure the business for current and future market conditions in the context of a market where demand for holiday packages will be significantly more volatile from year to year than it has been in recent years,” he said.

Mr Corcoran said that a key part of the restructuring would be to drive increased bookings through the internet.

“We’re going to increase our investment in our internet offering because customers are demonstrating a clear preference for internet bookings and we’re got to reshape our retail business to reflect that,” he said.

“Its important to stress that there are absolutely no implications in this announcement for anyone who has made a booking with us or intends to travel with us in the future," he added.

Budget, like many other travel operators has seen demand fall substantially this year. In June, Toolin Travel, which had eight retail branches in Ireland ceased trading while Thomas Cook recently closed a number of stores in Ireland, a situation which led to a sit-in at its office in Grafton Street.

“We estimate that overall demand amongst Irish tour operators is approximately 40 per cent down on last year and our experience reflects that. The key to the future is to have a business model that has maximum flexibility to respond to volatile demand while remaining profitable," concluded Mr Corcoran.

Stores expected to close are in Athlone, Tralee, Clonmel, Waterford, Cork’s North Main Street, Mullingar, Dundalk, Ennis Shopping Centre and Limerick’s Crescent Shopping Centre. In Dublin, branches at Liffey Street, Swords, Walkinstown, Finglas and the Northside Shopping Centre have also been earmarked for closure.

A Budget Travel spokesman said the stores will be shut down before the end of October.

Not surprised really, given other events recently such as Toolin and Thomas Cook.

Berty

+ 1 on the lack of surprise.

If you work for Budget Travel and did not see this coming................

Albeit a shame they are losing their jobs the economy needs to contract before we can recover.

Munster Gal

It's sad to see more job cuts announced. In Midleton, Co. Cork a new Falcon Travel Shop is opening soon - it seems they've taken over an independent travel agency.

pokie303

A new falcon shop in midleton???? really
is it just a franchise or are they actually taking it over as a falcon shop

nick1

If there is a "new" Falcon shop then it is just a travel agency who has decided to rebrand .i.e a franchise. I can't imagine that Falcon or any other company or individual will actually spend money on opening a retail travel agency in Ireland.
Since start of the year over 50 travel agencies outlets have closed, seperate from the recent Budget announcement of 14 closures.

By years end several more will close. I'm guessing 30-40.
Once the new VAT rules come into effect then more will close.

And I reckon that not all tour operators will be around either. They've all lost money this year.

The only upside is that the customer is fully protected for every cent spent when buying foreign travel from a licensed travel company,whether or not it goes bust.

Munster Gal

pokie303 wrote: »

A new falcon shop in midleton???? really
is it just a franchise or are they actually taking it over as a falcon shop

It's probably a franchise as nick1 describes, there's a sign in the window saying they'll reopen as a Falcon Travel Shop. My original post is badly worded - the insomnia was getting the better of me

nick1

I note on aviationreg.ie website -the website of the travel trade's licensing authority, Dept of Transport's Commission for Aviation Regulation,
that Budget Travel has not yet had its license to trade renewed -either as a travel agent or as a tour operator.

Also, the MD of Budget Travel suddenly resigned yesterday.

for the record I'm a travel agent and delighted if Budget is on its way out -though very sorry for the staff.

lasno

Budget travel do not sell through travel agents so I am not surprised with your
attitude.

nick1

duh, thats why i wrote the last line- to admit that I am completely biased.

RxQueen

nick1 wrote: »

I note on aviationreg.ie website -the website of the travel trade's licensing authority, Dept of Transport's Commission for Aviation Regulation,
that Budget Travel has not yet had its license to trade renewed -either as a travel agent or as a tour operator.

Also, the MD of Budget Travel suddenly resigned yesterday.

for the record I'm a travel agent and delighted if Budget is on its way out -though very sorry for the staff.

glad to see "our misfortune" of being out of a job is helping your business :rolleyes: no travel agents is safe, tbh i see falcon going the same way after the year is out.. loads of tour operators are going the same route as budget and backing out of selling through travel agents ie tropical places and can see load more following route.. you'll have less choice to sell, a harder sale , and trying to keep up with cost on the internet , not going to happen you cant compete

_Kooli_

nick1 wrote: »

If there is a "new" Falcon shop then it is just a travel agency who has decided to rebrand .i.e a franchise. I can't imagine that Falcon or any other company or individual will actually spend money on opening a retail travel agency in Ireland.
Since start of the year over 50 travel agencies outlets have closed, seperate from the recent Budget announcement of 14 closures.

By years end several more will close. I'm guessing 30-40.
Once the new VAT rules come into effect then more will close.

And I reckon that not all tour operators will be around either. They've all lost money this year.

The only upside is that the customer is fully protected for every cent spent when buying foreign travel from a licensed travel company,whether or not it goes bust.

What are the new VAT rules?

nick1

emo -you are right. i am under no illusion that I or any other retail travel agency will survive for much longer.

As you say, Falcon are going down the same road -all staff on three day week till mid-February and some shop closures.

If I can carry on for a while longer because the nearest retail agency to me (which happens to be a Budget shop) closes, I won't be sad. Whilst traders may be friendly with their nearest competitors, they obviously prefer the competition to go than themselves.

I am sorry for the travel trade staff (and that includes feeling sorry for me and my staff!). Until now the big travel companies -Thomas Cook, Falcon have been reasonable with staff - 4-5 weeks per year redundancy.
I gather that your employer may not be quite so generous for which i am very sorry.

However, it is not yet certain Budget Travel will close -it depends very much on the court case tomorrow regarding the license.
(Obviously it also depends if people start booking holidays as well !)

I do apologise how I phrased that crass comment about being "delighted".
=========

Re last post's question on VAT rules-

from 1 January 2010 we have to charge VAT on the profit/commission we make. Its more complicated than that, but very crudely, if we make,say, 30 euros profit on a booking we have to charge VAT on that -another six euros.
There's lots of different rules depending on how the booking is made but basically its going to means lots more accounting paperwork plus extra charges.
Considering we are not making any money anyway this is another reason to close !

Corkie1

Hi Nick1,
i would say not many travel agencies will survive. If the likes of Budget travel are allowed operate without a Licence. I understand they still have a bond. But they do not have a Licence to trade, and therefore are trading illegally.Their failure to co operate with travel agencies in Ireland like they did many years ago, has led to their demise. GREED has prevailed and now they don't even have a Licence.

nick1

Budget Travel are trading this week (check website for quick proof -and proceed with a booking until the point you press credit card details).

But, although Budget have no license(yet) it is not illegal for them to trade. This is because of the court case between Budget and the Dept of Transport (Commission for Aviation regulation) which has bene postponed till next week. Very roughly - the bond that was due to expire until end October is still in place until the new license/bond is sorted out.

According to the Irish Times Budget are arguing that the licensing conditions (mainly the bonding requirments) imposed by the Commission are unfair, whilst the Commission are concerned with various aspects that we cannot discuss on this website until the case has gone to court.

Besides the iconic status that Budget has long held in the travel industry there are still nearly 200 employees involved (down from ca.300 ).
So this is a very keenly watched case.

Skid

Budget Travel to cease trading
http://www.rte.ie/news/2009/1125/budgettravel.html

The inevitable has happened, sadly ...


Ireland's largest tour operator Budget Travel is to be wound up after a provisional liquidator was appointed at the High Court.

The company will cease trading from this evening with the loss of 172 jobs and the closure of 17 retail shops.

The company was established in May 1975 and had a 30% share of the market.
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Almost 750 people are on holiday abroad with Budget Travel.

The company says it is working closely with the Commission for Aviation Regulation to ensure plans are put in place to enable all customers to return to Ireland with the minimum of inconvenience.

For people who have booked holidays with Budget Travel, the company says it may be possible to arrange a similar holiday package with an alternative company.

Up to 380 people are due to fly out on holidays with Budget Travel between tomorrow and Sunday from Dublin and Cork.

Those flights have been cancelled and people can get a refund from Commission for Aviation Regulation.

Budget Travel Managing Director Eileen O'Sullivan said: 'This has been a painful and distressing time for us all and we deeply regret that this situation has arisen.

'We will do everything we can to minimise the impact of this decision especially on those who are currently travelling with us.'

A helpline number is available for intending passengers - 01 661 3122.

Reganovski

Tried ringing the number and it says it's closed. My parents were suppose to travel on Friday with them.
What's the story with the refunds? What needs to be done? Will they get a full refund?

Tippex

my understanding is that all refunds will need to be processed by the commission for aviation and the refund will come from the bond.

MisseyC

I for one am gutted by this as Budget where the only company that went to a certain apartment complex in corfu which I have gone to every year for the past 5 years and have made some great friends with the locals.
Don't get me wrong my heart also goes out to those who have lost their jobs durning this aswell