Business Travel agents under no illusions – big layoffs set in motion
Global market leaders are no longer waiting to make reductions? The avalanche has started? Local leader eTravel bravely resists trend, how it's succeeding ?
Hope for an imminent recovery in the business travel market seems to be evaporating. Some voices are talking about 2024 which is expected to move closer to pre-Pandemic sales levels. Current sales results undoubtedly confirm these concerns.
End of illusions time for big layoffs
This realistic approach to the market is not without consequences when it comes to employment decisions. In recent days, the Polish market has seen some spectacular news regarding staff reductions.
Global giant CWT will carry out cuts of up to several hundred jobs in Poland. The service center located in Warsaw's Domaniewska Street will suffer the most. The giant does, however, have some ability to relocate employees/tasks to lower cost locations. Because for years it has invested in its Rzeszow facility.
No better news is also coming from HRG where significant reductions have also been made in recent days. Including those affecting experienced employees associated with the company often more than 10 years. This clearly shows that the jokes are over on the market.
E-Travel is saved by cooperation with global players
The business travel market leader eTravel is in a relatively better position. This situation is determined by the cooperation established years ago with international organizations like Egencia and Frontex. The first partner, in addition to providing additional turnover, certainly contributes to the cost of maintaining dedicated staff. This is a big relief for eTravel .
On the other hand, a key customer EU Frontex, by virtue of its tasks, has to travel a lot even in a pandemic. So it will continually generate the turnover so necessary in these times. Importantly, this is not a low-margin client either. For the right service can pay the market.
eTravel certainly also benefits from other synergies m.in. The potential to sell holiday offers to corporate clients. Serving Poland's largest companies, it has ample room for improvement in the form of “private” service to their employees.
Will new players benefit and compact offices take over employees ?
The market is seeing increased activity from smaller players. In advertising invest m.in. Trivium, Old Town or Bissole. Sales results clearly indicate that these types of agents are doing much better than the giants.
Certainly the problems of the big players will be sought by new entrants to the market. Of particular interest is the fate of innovative ticket booking platforms like Hotaliors and Stery. These companies, too, may have ambitions to become quasi TMCs.
As if that wasn't enough, B2B platforms will also fight for the airline ticket market – RateHawk, which is active and so far known for its hotels, and Indian giant TBO Holidays. It won't make life easier for crisis-ridden traditional business travel agents.
Layoffs at leaders can be an opportunity for aspiring agencies to attract valuable personnel. Such as Profi Travel or GAS.
What is LOT Travel doing in this context?
It is also worth looking at the actions of the Lotov subsidiary in the context of those taken by market leaders. For now, we don't see any significant moves to reduce costs here. Regional offices are still operating and headquarters is doing well in the Lotow office building.
The question remains about the financing of this welfare. For looking at the situation of the industry, it is difficult to assume that the company operates on commercial terms.
In the context of painful layoffs of employees in the sector, the pressure to heal the segment of public tenders for business travel may also strengthen. This is because past practice has largely closed the way for global agents to participate. This has also translated into lower innovation and poorer service quality in this segment. Will now be the time to clean up this situation?