Yesterday’s announcement of the sudden closure of the Malvern Groups business which include: UK and European City break specialists Superbreaks Mini-holidays, the online room agents Late Rooms and Malvern Travel Technology may have come as a surprise, albeit that PWC have been trying to find buyers for the business, or businesses, ever since 49% group shareholders, Cox & King, the luxury and India travel specialist, defaulted on loans a month ago.
Most media coverage has focused on the impact on holiday makers currently on holiday or booked to go with Superbreaks and those with a hotel booking for a future date with Late Rooms. Generally, the view seems to be that most holiday purchases from Superbreaks (or at least the money paid out in advance) will be protected and hotel room bookings honoured as Late Rooms worked on a commission model paid back to them by the venue rather than taking full payments themselves. That will be some reassurance for customers but not for the c 250 staff in Manchester and York now the businesses have ceased trading. A fire sale of some or all of the businesses and therefore potential future trading of course could still be on the cards?
What is happening now and in future to businesses using Malvern Travel Technology technical support systems to power their businesses has yet to be publicly aired. It is difficult to get a handle on just who and what were reliant on their technology and to what degree that will now impact on other tourism and travel businesses.
Understanding precisely why the Malvern Group has collapsed and understanding that sooner rather than later is important because in the absence of hard fact it will be easy to assume that it has been driven by depressed demand from customers in businesses that operate to a significant degree in the UK market. It could be that, but equally it could be down to a range of issues from: a failings in the business model to growing competition from new platforms operating in the market, or it could be purely down to the problems of cash flow caused by Cox & Kings’ financial problems; problems that are not largely UK domestic but UK outbound related.
Meanwhile, the public will see and read headlines and draw their own, potentially ill-informed, conclusions about the state of the UK tourism and travel markets. Coming on top of recent mixed messaging and indeed the mixed reality of UK’s recent weather that is not necessarily good news for the remaining key summer weeks in the equally key UK domestic holiday market.
One of the more business orientated media article publish yesterday can be accessed at: https://www.businesscloud.co.uk/news/malvern-group-to-appoint-administrators