Youhotels touts new alliances as answer to sector consolidation

Trade bed bank could become the latest supplier to forge closer strategic alliances with retail partners as the dynamic packaging sector looks maintain its competitive edge.

With the dearth of cheap charter flights the sector was built on no longer available and the prospect of increasing regulation, the sector has seen significant consolidation among independent suppliers.

Thomas Cook’s buy-outs of Medhotels and Hotels4U saw the two biggest bed banks join the vertically integrated giant while Lowcost Travel Group has entered a joint venture with easyJet.

Even a pure play online agent like On The Beach, thhat has been linked to a potential buy-out of beds supplier On Holiday Group, has been prepared to agree commitments in its search for seats.

So, with Thomas Cook laying out ambitious plans for and easyJet Holidays being touted as a potential rival to the big two, where does that leave Youhotels?

Paul Riches, sales and marketing director, said: “We could buy one of the big OTAs like Travel Republic, but they’d want a lot of money.

“Or we might buy three smaller ones, or else strategically we could put something together. Why not an online retailing consortium?”

“If agents are in our sector in any meaningful way they are purely dynamic packaging businesses that work with either two, three or all four of us [Hotels4u, lowcost, OHG and Youhotels].

“We could follow everyone else, or be the independent provider for the independent agent.”

Riches said there were only 30-40 agents doing 80% of business and they needed stronger partnerships while Youhotels would play to their strengths.

“Some are very good online, some great at readers offers, some through Teletext, some word of mouth. We need to source agents that are great in each channel and routes to market like, Travelzoo, Teletext Tip off and Group-on.”

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