The travel industry has already lived through several fundamental distribution shifts. We moved from high street travel agents to online travel agents. We saw the demise of the Vertically Integrated Tour Operators and the rise of Low-cost Carrier Holiday Divisions. We then moved from brochures to Google search. Then, after all that came the move to mobile booking, the growing influence of review sites and a social media explosion.

But I believe the move to AI could be bigger and quicker than any of these previous shifts.

Over the next five years, AI Search will fundamentally change how UK consumers research, compare and book holidays. Instead of the winners being the businesses with the biggest Google PPC budgets, the new winners will be the companies that can provide trusted information, strong brands and AI-friendly content.

The travel industry is moving from a world of PPC Google blue “links” to a world of AI “answers”.

The shift has already started, as AI Search is already changing customer behaviour. Instead of the short question, Google trained them to ask questions like “Cheap holidays to Greece”; customers can now ask Gemini, ChatGPT, Perplexity, and Claude complex questions that state their full needs.

“Where is the best family holiday in Greece for a family with two teenagers on an all-inclusive basis from Manchester in August for a budget of £4,000?”

Ten years ago, Google would have returned ten blue links and several adverts, forcing customers to spend 6 hours and visit 38 sites on average to find the final answer. Today, AI can provide a complete answer in seconds, without the customer needing to visit multiple websites, which is a much better experience that will drive rapid adoption.

Google itself is being forced to destroy its own massively profitable PPC model via Gemini and is investing heavily in AI travel-planning tools that can build itineraries, compare destinations, and recommend flights and hotels directly within search.

This matters because every time an AI provides an answer, there are on average 20 fewer clicks available for travel websites to buy through PPC advertising. That may not sound like a lot initially, but this is already impacting OTA’s website traffic with a 30% year-on-year drop.

As my last blog on TripAdvisor showed, AI-generated answers are also devastating many information-based websites, including TripAdvisor, because users can get answers without even visiting their sites. With AI engines now using MCP connectors to add pricing and availability information and enable in-search booking, this is set to get much worse in the next 12 months.

Although today’s AI search engines still largely provide recommendations and information, tomorrow’s Agentic AI agents will increasingly complete transactions on behalf of customers, with Google, OpenAI and others moving towards agentic AI systems capable of researching, comparing and eventually booking travel products.

Imagine simply speaking to your AI assistant and saying:

“Taking into account my usual preferences, book me a seven-night all-inclusive family holiday in Majorca with good flight times during the school holidays, departing from Manchester, staying in a four-star hotel with a waterpark, for less than £5,000.”

The AI will search thousands of options, compare reviews, analyse flight times and present perhaps three recommendations rather than fifty pages of search results.

At this point, traditional online travel agents face a serious challenge.

Businesses such as Booking.com, Expedia, On the Beach and Love Holidays have built their success on helping customers compare large numbers of options via their websites. If AI can perform much of that comparison instantly, the value chain changes dramatically. Research already suggests that AI search may reduce the historical dominance of intermediaries by connecting consumers more directly with suppliers and using trusted content sources to help make those recommendations.

This does not mean travel brands disappear. Quite the opposite.

I believe trusted brands become even more important.

AI systems need sources they can trust. Strong customer reviews, expert content, recognised brands and genuine authority become critical ranking signals. The future battleground will not simply be SEO. It will be GEO, “Generative Engine Optimisation”, which is about ensuring AI systems understand, trust and recommend your business. Not a simple task.

For UK travel companies, this means investing less in Google PPC budgets and more in building genuine authority. This is why Travel Voice has created the “Travel Book” concept, in which customers are interviewed by AI agents personalised with their booking details, enabling an interactive conversation that results in a professionally written picture-book magazine for them to show friends and family or just document their holiday for future remembrance.

The digital versions are provided by the Travel business for Free to the customer on the basis that they can also use the content to promote the holiday to future customers and to power their responses to AI Search.

We expect that 80% of customers will want to print their holiday books, and when they do, the travel business recovers the cost of the digital production, creating a very low cost of building unique user-generated content about their products.

This is vital because original content, destination expertise, customer reviews, social proof and trusted brands will become the new currency of AI Search visibility.

Ironically, the biggest disruption will come from Google itself. For twenty years, Google has earned billions by selling clicks to travel companies, but AI search, which moves consumers directly from question to answer, undermines this model and requires a complete rethink of the economics of travel marketing. Google is already adapting by introducing AI-driven advertising products that place promotions within AI-generated responses rather than in traditional search listings, but this alone is unlikely to replace their lost revenue. It’s much more likely that the entire business model will move to a CPA model, where Google takes a success-only commission for every travel sale it enables.

In my view, the future is clear.

Five years from now, most UK travellers will start their holiday search by talking to an AI rather than typing keywords into a search box and their digital twins on their phones will reach out to travel businesses via MCP with highly complex requirements and will expect travel businesses to be able to analyse and respond with their recommendations. These will be compared on price, with a short list of 3-5 results presented to the holiday maker, who will then just click to book their chosen option.

The companies that learn how to become the answer will thrive.

Companies that still rely on buying blue links will soon wake up to find the river is dry and they are out of business.

For years, much of the travel industry debate has centred on the battle between traditional tour operators and Online Travel Agents (OTAs), with endless discussion about who owns the customer relationship, who has the best technology stack and who can dominate Google search results. But in reality, one of the biggest strategic advantages in the accommodation sector has very little to do with hotel inventory or website design. The real power increasingly comes from controlling the cash collection process and becoming the “merchant of record” for accommodation bookings.

This is where companies such as Booking.com, Expedia Group and Airbnb have quietly evolved beyond simple travel distributors and become something much more powerful. In many ways, they now operate as hybrid travel and fintech businesses, because the real profitability increasingly comes not just from commissions, but from controlling the flow of billions of pounds of customer money moving around the globe.

One of the most important things many people outside the sector fail to understand is the massive difference between selling accommodation-only products and selling traditional package holidays that include flights. In the UK, flight-inclusive package holidays fall under ATOL regulations and various customer protection rules designed to safeguard travellers if an operator collapses. As a result, much of the customer money collected by a traditional tour operator is heavily restricted. Funds often need to be ringfenced, held in trust accounts or protected through financial bonding arrangements, meaning operators cannot simply use that customer cash freely to fund growth or investment.

As I discovered when I launched On Holiday Group and later served as chairman of Alpha Rooms, the cash flow from our accommodation-only division provided the capital to expand the business rapidly and to invest in Google and brand advertising, since although margins are lower than selling packages, using customer cash is subject to few restrictions in this sector.

The key is to be the accommodation-only merchant businesses that collect cash from customers on behalf of hotel partners, because customers are used to paying in full when booking late deals, and you can often negotiate to pay the hotels a month after the customer’s departure, creating large working-capital stretch balances. Unlike banks, they do not pay interest to access those funds, and unlike traditional package operators, much of the money is not trapped in trust structures.

The scale of this becomes extraordinary once you look at the numbers involved. Industry analysis suggests that Booking.com alone is holding somewhere in the region of $8 billion of traveller money at any given time, while Expedia Group may hold even more. This effectively gives these businesses giant revolving credit facilities funded almost entirely by travellers themselves. That free cash flow can then be used to invest in artificial intelligence, technology development, acquisitions, marketing expansion and even stock buybacks without the need to constantly raise external capital.

This is one reason the merchant model is so strategically powerful and why the largest accommodation platforms have become so dominant. The bigger the OTA becomes, the larger the float of customer money it controls. The larger the float, the more aggressively it can invest in technology, customer acquisition and market expansion. This then attracts more hotels onto the platform, which in turn generates even more bookings and therefore even more customer cash float. It becomes a self-reinforcing financial flywheel that smaller competitors find incredibly difficult to compete with, meaning the bigger player gets bigger and the rest are gradually squeezed out of the market, which is exactly what happened to Alpha rooms over time.

What makes the model even more lucrative is that the payment layer itself has become a major source of profit. Once an OTA becomes the merchant of record, it controls both sides of the financial transaction. It decides which currency the customer pays in and which currency the hotel supplier ultimately receives payment in. Sitting between those two transactions creates enormous opportunities to profit from foreign exchange conversion margins.

A customer in the UK may book a hotel in Spain and choose to pay in pounds sterling. The Spanish hotel may ultimately receive payment in euros. In the middle sits the OTA, which controls the conversion process. Most travellers barely notice the 1% to 3% exchange rate spread embedded in the booking price, but when you are processing tens of billions of pounds’ worth of international hotel reservations every year, those small margins quietly add up to hundreds of millions in additional high-margin profit, and even more money can be made by treasury departments buying currency in advance if rates drop temporarily. This is, of course, calculated gambling and carries risk, but it’s used to make up 30% of Medhotels profits when Hime Perry ran the business.

This is why many of the world’s largest travel businesses increasingly resemble financial technology companies wrapped inside travel brands. The customer may think they are simply booking a hotel room, but behind the scenes, the OTA is managing global payment flows, foreign-exchange conversion, fraud prevention, payment verification, and cash-flow optimisation on an enormous scale. The travel transaction itself is almost becoming the trigger for a much larger financial ecosystem.

Ironically, many hotels originally embraced the “Pay via Booking.com” style merchant model because it solved genuine operational problems. Hotels were tired of dealing with invalid credit cards, payment fraud, no-shows and collection administration. Allowing the OTA to handle the payment process simplified operations and reduced risk. However, in doing so, much of the accommodation sector gradually handed control of the payment layer to the OTAs, and with it, one of the most profitable parts of the value chain.

Today, many independent hotels are not just dependent on Booking.com and other OTAs for customer acquisition, but also for payment processing and even cash-flow timing. Meanwhile, the OTA is generating commission income, financial float income and foreign exchange profit from the same transaction. Once you fully understand these economics, it becomes much easier to see why merchant models are so attractive and why the biggest players in accommodation distribution have become so difficult to compete against.

The next decade of travel innovation will almost certainly be built around this financial infrastructure. Although preparation for AI Search and constant testing of user interfaces are important, many businesses forget the basics of optimising travel distribution, payment processing, foreign exchange management, and financial engineering into one integrated global platform.

I always advise travel businesses to act like travel agents but operate like banks, maximising customer cash that sits outside trust funds. Selling flight-inclusive packages may boost margins and increase stickiness, but often at the expense of funding growth through the use of customer cash. The optimum solution is often to operate both products, but to keep them within separate trading companies to keep them outside the focus of UK ATOL regulators.

The rules are the rules, but like most things, there are a few exceptions that can advise you have to work legally outside of them.

Email me at se@steveendacott.co.uk if you want to know more. Although I charge handsomely for my time, I have never had a client who did not achieve a very healthy return on their investment.

AI will transform the travel industry over the next decade, but not in the simplistic way many people predict. Humans will still want to buy holidays from humans, especially when spending thousands of pounds on important family experiences. The reassurance, empathy and trust provided by experienced travel agents, homeworkers and high street shops will still matter. However, there will almost certainly be fewer of them because AI copilots will remove a huge amount of administrative, quotation-building, itinerary-management, and booking work. The best salespeople will become dramatically more productive and capable of handling far more customers than today.

At the same time, AI will democratise travel selling. New distribution channels, such as TikTok GO and AI-powered creator commerce, will emerge, allowing almost anyone with an audience to become a travel agent. The complicated system knowledge and booking processes that once required years of training will increasingly be handled by AI assistants behind the scenes.

The biggest disruption, however, may hit online OTAs. Consumers are rapidly moving away from traditional website form-filling towards conversational AI search. Instead of typing dates and destinations into booking engines, customers will simply ask AI assistants for “the best luxury family holiday in Spain under £5,000 leaving in August”. AI search engines will then use machine-to-machine conversations via MCP connectors to query suppliers directly and return the ten best personalised recommendations instantly, so less will become more, with recommendations reflecting what users want rather than thousands of hotels to choose from.

The decline of Tripadvisor should serve as one of the biggest warning signs yet for the global travel industry, because what is happening to Tripadvisor today could easily happen to Online Travel Agents tomorrow.

For years, Tripadvisor was one of the most powerful travel businesses in the world because it controlled something incredibly valuable: consumer intent. When travellers wanted to know where to stay in Tenerife or where to find the top-rated restaurant in Rome, they went directly to TripAdvisor.

The company built a vast empire based on user-generated reviews, trust and organic Google traffic. Millions of customers visited the platform every day, read reviews, and then clicked through to hotel booking partners, generating significant advertising and referral revenue in the process.

The problem for TripAdvisor is that artificial intelligence has made it much quicker for customers to find the same answer without even visiting the TripAdvisor site. The large language model then summarises thousands of reviews, customer opinions, location advantages and pricing signals into a simple conversational answer within seconds.

AI search has effectively turned Tripadvisor into a data source rather than a destination website, and that distinction is massively important because Tripadvisor’s entire commercial model depended upon attracting traffic to its own pages.

This creates a devastating economic problem for the business. TripAdvisor still bears all the costs of running the platform, moderating reviews, maintaining trust systems, and hosting enormous amounts of travel content, but the value generated by that content is increasingly being stolen by AI search engines and large language models.

Consumers receive the answer they need without ever clicking through to Tripadvisor, which means fewer hotel referral clicks, less advertising revenue and weaker conversion income. That decline in engagement has directly impacted the company’s hotel sales business, which historically represented one of its most profitable revenue streams. Investors have clearly recognised the scale of the threat, which is why Tripadvisor has suffered such a prolonged decline in value over recent years as confidence in the long-term sustainability of the business model has weakened.

The key point, however, is that this is not just Tripadvisor’s problem. It marks a pivotal moment for the entire online travel sector, as the same forces are now beginning to shift towards the Online Travel Agent market. For the past twenty years, OTAs have dominated travel distribution by controlling search traffic aggregation. Consumers searched on Google, landed on OTA websites, compared flights and hotels, and then completed bookings within the OTA ecosystem. The largest players spent billions on Google advertising, SEO and brand marketing to sit at the centre of this customer journey and monetise the traffic flowing through their platforms.

Artificial intelligence threatens to remove that journey altogether. In the future, customers will simply speak to AI systems and ask questions such as: “Find me the best five-star all-inclusive hotel in Turkey for a family of four under £3,000 with direct flights from Manchester during the school holidays.” The AI engine will then instantly compare flights, hotels, reviews, locations, weather patterns, customer sentiment, and pricing via direct computer-to-computer interactions through APIs and MCP-style connectivity. Instead of browsing ten OTA websites and manually comparing endless lists, consumers will simply receive ten perfectly tailored recommendations generated automatically within seconds.

At that point, the industry faces an uncomfortable question: what role does the traditional OTA play? If AI systems can dynamically and intelligently assemble travel, customers may increasingly book hotels and flights separately on their own credit cards rather than purchasing more expensive ATOL-protected package holidays.

The AI assistant itself may eventually manage the booking process automatically. That poses a potentially existential threat to parts of the traditional package holiday model, as consumers have historically accepted packaging partly for its convenience and simplicity. AI could now provide that convenience without requiring the traditional intermediary layer.

The regulatory angle here is also extremely important and rarely discussed properly. For years, Google has operated as one of the world’s most powerful travel discovery platforms through Google Flights, Google Hotels, and integrated travel search services, yet it has largely been treated by the UK Civil Aviation Authority as anything other than a traditional travel organiser.

If Google has been allowed to mediate travel discovery, direct customers to suppliers, and monetise travel search traffic without operating within traditional ATOL structures, it becomes increasingly difficult to argue that future AI recommendation engines should somehow be treated differently.

That is why Tripadvisor’s decline matters so much.

This is not merely the story of one travel company losing relevance. It is an early warning that AI search is beginning to disintermediate the wider travel distribution chain. The travel industry has spent decades assuming that controlling websites, search rankings and customer traffic funnels created defensible competitive advantages.

AI may now fundamentally undermine that assumption. In the AI era, consumers may no longer visit websites at all. They may simply ask questions, receive trusted recommendations instantly and transact directly with suppliers through intelligent automated systems.

If that happens at scale, many of the travel industry’s current business models could face enormous pressure very quickly.

It’s not quite RIP for the OTA’s but if giants like Tripadvisor can fall so fast then so can Love Holidays and On the Beach.

Travelling to Lindos in Rhodes this week reminded me how seasonal some leisure destinations are. The resort of Viycha Bay Lindos was a complete ghost town on 29th April, as our EasyJet flight arrived a day before the official resort opening, and we were the only 4 guests at the beautiful Blu Hotel on the first night.

At this time of year, the weather is a bit hit-and-miss in Greece, and the previously forecast four Sunny days quickly turned into cloudy days, when jumpers needed to be purchased urgently.

The upside was that we fully explored both Viycha and the Lindos itself, whilst making some new friends in the local Greek hospitality industry. It was also interesting to see a resort wake up after being virtually mothballed for 6 months during the winter, with generators being powered up as hotels opened and sun beds being dragged out across the beaches.

Interestingly, on the first day, only the Lindos White Hotel & Suites, which was featured by both Easyjet Holidays and Jet2 Holidays on an All-inclusive basis, was rammed with customers fighting over sunbeds, whilst most hotels remained empty. Looking up EasyJet Holiday prices showed me why, as customers had clearly grabbed a bargain All Inclusive break for £641 per person, a 50% discount on peak-season pricing.

Vicha Bay is actually not connected to Lindos at all, with a taxi around the headland required to access the picture-perfect beauty of Lindos Town itself, and locals advised us not to bother visiting during the day, as quote “It’s full of American Ice cream lickers off Cruise boats during the day”, as Lindos is the third most visited destination after the Acropolis of Athens with nearly 1 million visitors per year.

Like London Gatwick, the hotels in the surrounding bays all included the word Lindos in their names to create an association with this well-known resort, which I can hardly criticise, given that I forced the renaming of Sanford Airport to Orlando Sanford when I built it whilst heading up Airtours Overseas and Commercial operations in the 1990s.

As with many newer resorts in the holiday sector, Lindos has recognised that holidaymakers are willing to pay a premium for high-quality accommodation. The large, sprawling complexes built into the hills of Viycha are modern temples of glass and stone, with suites, swim-up pools, spas and excellent service.

What the resort cannot control, however, is the weather, and unfortunately, our short break was beset with clouds and cool temperatures of 19 degrees or below.

Beach resorts are only really geared up for mass tourism with sunshine, as there are few things to do if the weather turns cold, apart from long walks, leisurely lunches and lots of drinking in the resorts’ bars, whilst watching the Premier League on satellite TV.

But the cool weather does make you much more social, and we have probably met and chatted with more other couples than on any other trip I remember, because, when you think about it, sunshine is an isolating factor, as we normally spend many hours in solitude, reading or relaxing on sunbeds around the pool, not talking to anybody else.

Instead, this year, the combination of chat and human interaction has stimulated my mind into its usual hyperactive mode, and I have found myself doing business plans to reshape an existing business by splitting it into two distinct companies/products and creating a new AI Tool called “Muppet ME”.

Having an AI incubator gives me the luxury of a talented tech team that can know up products in days, so I set them the task of building the “Muppet Me” App to simplify the complex AI process of creating a Muppet Avatar of people that can be taken and used within fun holiday images like the one attached to this blog. Yup, even I must worry that I’m going completely mad, but it’s a bit of fun.

When visiting Lindos itself, it was noticeable that the local government has controlled its tourism development, with Lindos preserving its 16th-18th-century Ottoman heritage, including whitewashed houses, narrow alleys, hidden courtyards, and compulsory rooftop restaurants.

All the new, larger hotels had been pushed to the surrounding bays, with the bay of Lindos itself left undeveloped to preserve Lindos’ historic feel and as a day-trip attraction.

This is just the sort of action that is needed to allow a resort to enjoy large volumes of daytime cruise passengers without affecting its core 7-night holiday makers, who then fill the resort’s plentiful restaurants in the evenings.

Also, as with other Greek resorts I have visited, the Greek hoteliers simply do not want to extend their season into April, because they enjoy their winter breaks and cannot understand why customers would want to come earlier, given the cooler weather and the likelihood of rain.

Perhaps next year I’ll take more notice of this sensible logic and return in June, as the hotel, resort and people are truly special hosts.

As a 60-year-old, I am comfortable with Facebook and LinkedIn but rarely explore Instagram or TikTok, as I have never been my thing. In recent years, I have surrounded myself with younger people who fully recognise the opportunity that using influencers to inspire travellers represents, and I have already invested in specialist businesses such as Trending Travel and the soon-to-be-launched Trip Influencer.

The “Dream” stage of deciding where to go on holiday used to happen in our pubs, where we chatted with friends and family about our holiday experiences, and many a trip was booked after one too many beers or by popping into a local high street travel agency to pick up a few brochures and get some suggestions. Even the school gates were a source of inspiration, as mums often chatted about hot new destinations like Croatia.

However, much of this was lost as travel moved online, because Google, OTAs and even the new low-cost tour operators have focused more on the booking transaction process than on capturing and retaining customers throughout their “Dream, Research and Book” booking funnel.

The Trip Influencer team convinced me that they could create a completely new booking funnel by turning influencers into travel agents and providing them with the required tools to turn “Demand Stimulation” into bookings.

They have therefore built a price comparison engine that allows the influencer to promote a specific hotel or the wider destination of Dubai, and then show viewers up-to-date pricing and availability from all the major operators for that destination, so they can compare prices before booking the trip, all in one simple, connected process.

We anticipated the need for a full customer “re-education” process, as holidaymakers had never booked travel on TikTok before. However, the launch of TikTok GO in the USA this week should make this much easier, as TikTok itself seeks to harness the power of its influencer community.

Fortunately, TikTok have decided to take on Google as a travel Search Engine rather than become a travel business itself, and in America has teamed up with OTA giants Booking, Expedia and Trip.com

However, TikTok does represent a major threat to Google. For nearly two decades, Google has quietly become the gatekeeper of the global travel industry. Whether you are booking a package holiday, comparing hotel prices, searching for airport transfers or looking for the best beach in Antalya, the journey almost always begins with a Google search.

That dominance has shaped the entire structure of online travel.

Travel brands spend billions each year fighting for visibility inside Google’s ecosystem through SEO, paid search, Google Hotels and Google Flights. Entire business models like Love Holidays have been built around understanding and exploiting Google’s algorithms better than competitors.

However, every so often, the travel industry experiences a major “reset moment” in which consumer behaviour changes faster than incumbents expect, and for me, this could be one of those.

Interestingly, instead of waiting for users to search, TikTok’s algorithm proactively creates desire. It places emotionally engaging travel content directly in front of users before they even know where they want to go.

Travel is one of the most emotional purchases consumers make, and TikTok’s content and algorithm are ideally suited to explore it.

The reality is that younger travellers are already using TikTok as a travel search engine. Restaurants, beach clubs, hidden destinations, boutique hotels and local experiences are increasingly discovered through creator videos rather than through traditional search results.

TikTok GO simply closes the final gap by integrating the booking layer directly into the platform, eliminating the need for users to switch to Google to search, potentially greatly weakening the number of travels clicks it provides to partners.

A weaker Google could reduce the barriers to entry within the UK online sector.

Historically, launching a new travel brand has been brutally expensive because Google effectively taxed visibility. New entrants had to spend heavily on paid search or invest years building SEO authority before they could compete with giants such as Booking.com, Expedia or Jet2holidays.

Social-led discovery potentially rewrites those rules.

A compelling TikTok video can now generate millions of organic views in just days. A creator can make an unknown hotel famous overnight. A small travel brand with clever content can suddenly compete with players spending tens of millions on Google advertising.

This is why I believe TikTok GO represents another major opening for new travel entrants, particularly agile comparison and discovery platforms like Hey Holidays, another of my recent investments.

Historically, comparison sites have often struggled because Google itself has increasingly inserted its own products into search results, squeezing third-party intermediaries out of the customer journey. But TikTok’s ecosystem is structurally different.

TikTok rewards engaging content, price transparency, emotional storytelling and viral recommendations rather than simply domain authority.

That potentially creates a huge opportunity for modern comparison brands that understand both travel pricing and social engagement.

A platform like Hey Holidays could thrive in this environment, as TikTok users are highly impulsive. They may discover a destination emotionally through a creator video but still want reassurance that they are getting the best deal before booking.

The winners of the next decade may not necessarily be the companies with the biggest advertising budgets. They may instead be the businesses best able to combine social discovery, creator partnerships, real-time pricing and frictionless booking experiences.

I recommend that my fellow veterans running the major travel business assemble a team of young people to understand the threats and opportunities that TikTok Go represents. We are not exactly the target market, but our future customers are, and if they move, your marketing spend needs to move with them.

Disruption is coming, and as readers of this blog know, I love disruption.

Just as with Covid-19, the war in Iran is causing major travel disruptions and many cancellations, often leaving travel agents who have done a lot of work with zero commission to show for it.

For years, the travel trade has debated charging customers for the time they spend making bookings, but competitive pressure has always forced them to steer clear of this and to continue to rely on commission payments from their tour operator suppliers and I don’t see this changing any time soon.

However, after Covid-19, I have always advised all the travel businesses I consult with or own a stake in to introduce a non-refundable “Retail Deposit” of at least £50 per person on top of the tour operators’ deposit.

To be clear, the final holiday price remains the same, and this deposit is simply a forward payment of the retailer’s commission. The crucial benefit is that the retailer has certainty that they will receive this element of their commission no matter what happens, and, as a result, can recognise this part of their commission on booking and release it from any relevant Trust fund that their consortia or head office may operate to protect consumer funds.

Assuming an average short-haul booking value of £2,500 and a 10% commission on the booking, the retailer can recognise £100 of their £250 commission on booking, with the remaining £150 recognised when the final balance is paid, but it also means if the customer cancels the holiday that the retail retains £100 to cover the work they have already done.

Of course, you will need to change your booking terms and conditions to reflect this, but it is perfectly legal, and few customers object because, although most shop around based on price, few compare payment schedules.

If you’re worried that you’ll lose bookings because others are offering low deposit levels of £60 on Jet2 holidays, for example, don’t, because you just keep this initial low deposit to secure the booking and collect your retail deposit one month later as part of the payment schedule.

The retail deposit also needs to reflect the value of the booking, with higher value long-haul or Cruise bookings attracting a “Retail Deposit” of £100 per person.

Most retailers already offer monthly payment plans, as many customers prefer to pay for their holiday in regular instalments. However, some have missed the very neat “Trick” introduced by the likes of Love Holidays, which charges a “sneaky” £4.95 admin fee for every monthly payment collected under their “Spread the Cost” schemes. Assuming 6 payments, this quickly adds an extra £30 margin per booking. These fees are not even included in the total holiday price because they are not a “Compulsory” charge, as customers can pay the full costs in one go.

Again, perfectly legal and a neat way for a retailer to earn higher commission without affecting your competitive pricing.

Let me know if you find these tips useful, as I have a lot more to offer!