‘It’s killing us’: War rooms and tour group refugees as travel takes a coronavirus hit

As soon as TripADeal chief executive Norm Black finishes wrestling with one crisis stemming from the coronavirus pandemic, a new one flares up.

"We have a tour group who are literally refugees in Slovenia right now, they are getting refused border crossing left, right and centre," the co-founder of the travel company says. "It is crazy, a busload of Aussies who split from the group and are now stuck."

Black has set up a "war room" at TripADeal's Byron Bay headquarters, with 10 key staff members responding to events as they unfold, and the business is operating a 24/7 hotline for its customers.

TripADeal chief executive Norm Black and marketing manager Lucy Walgers in the company’s ‘war room’ in Byron Bay.Credit:Danielle Smith

TripADeal turned over $200 million last year by "making bucket list tours around the world available to the masses".

"Now the masses don't want to go," Black says, with TripADeal's revenue expected to dive.

"Things are unfolding by the hour," he says. "We have people here really feeling the pain of having their holiday destroyed. I've been on the phone to the Slovenian embassy and then to the people on the bus saying 'Don't panic, get a good night's sleep, you are in no danger, you are not under a terrorist attack, we will get you home'."

Australia's travel sector has been hit hard by the coronavirus outbreak, with Flight Centre announcing on Friday it was closing up to 100 stores and The Tourism and Transport Forum estimating the virus’ impact on tourism will be $2 billion a month.

Tour providers like TripADeal and travel agents are scrambling to respond, as airlines cancel flights and the government recommends Australians reconsider all overseas travel.

Data from Melbourne travel startup Rome2Rio, which helps travellers find and compare routes, shows its bookings dropped to 5600 for March 4 to March 10, down 17.9 per cent on similar dates in February.

Cancellations soared 39.4 per cent for the startup, with managing director Yeswanth Munnangi saying the coronavirus threat started to affect bookings from February.

"We are bracing for a big impact from a revenue perspective over the next four to six months," he says.

Cherrybrook Travel employees Elizabeth Ellis, Caroline Daley and Judy Mahony in the office in Westleigh Village.Credit:Kate Geraghty

"It's killing us," she says. "Tour companies are all doing their best but it is all falling back on us and we are not coping. We have to sit on the phone for hours."

Ellis was on hold for eight hours to a cruise company enquiring about a client's booking only to be cut off.

"It is just a new situation every single day," she says. "In the last month this whole industry has been turned upside down and every day is worse."

Travel insurance generally does not cover pandemics and travel businesses are finding their business insurance also falls short.

Cherrybrook Travel’s Elizabeth Ellis (centre) was on hold for eight hours to a cruise ship company for a client. Credit:Kate Geraghty

Dennis Bunnik, the co-founder of Bunnik Tours, says he is bracing for major disruptions through March, April and June and hopes things will settle down after that.

"There is no insurance we are aware of that you can take for these things," he says.

Bunnik Tours has been operating for 25 years and Mr Bunnik says the company will draw on its long experience to try and get through the coronavirus threat as it prepares to juggle the $80 million of tours it has sold this year.

"As a travel company we have been through many crises before, the Sri Lanka bombings, SARS, September 11, these things come out of left field," he says. "It comes down to having the experience and strong financial management over many years. We have zero debt and high cash reserves."

Bunnik Travel’s co-founder Dennis Bunnik.

Mr Bunnik says the company is cancelling trips where travel has been stopped to countries and offering refunds to clients, the situation is more unclear where customers choose to cancel the trip themselves.

"Customer wellbeing and minimising risk are our main priorities, the financial side of this is the third element," he says.

One travel business looking on the bright side is Luxury Escapes, with founder Adam Schwab saying while many customers are postponing their upcoming trips there are still "savvy" travellers booking deals for holidays six months away.

Luxury Escape's high-end holiday deals are not refundable but the business is offering a free change of dates for those with trips more than 45 days away.

If people want to postpone the trip we are doing everything we can to accommodate them," Mr Schwab says. "What we allow is to change dates and hotels are generally allowing it."

January was a record month for Luxury Escapes with the business on track to turn over $500 million but Mr Schwab says Luxury Escapes will take a hit from coronavirus, it is unclear how big it will be.

"The main risk travel businesses face is global pandemic risk," he says. "Some competitors will go out of business, less-well-funded ones, it might be a chance for us to work with hotel brands we haven't worked with in the past," he says.

Mr Schwab predicts the travel market will rebound quickly with "huge demand" in two to three months time.

"The tap will turn back on, so there will be a silver lining," he says.

In his "war room" Mr Black is also optimistic as he negotiates a further 230 TripADeal customers off a cruise ship in Rome to the airport to fly home to self-isolation.

"We think it might be a minimum three months' severe downturn, but what happens at the end of this? History tells us it comes back incredibly strong almost like an avalanche," Mr Black says. "Aussies, we love to travel, so if businesses get through it, there is a lot of light at the end of the tunnel."

Follow MySmallBusiness on Twitter, Facebook and LinkedIn.

Source: Read Full Article