NZ travel agents reject Helloworld network

More than half the franchisee members of NZ’s oldest retail travel network are refusing to sign up with Helloworld.

Helloworld chief Elizabeth Gaines says said Helloworld will consolidate franchisees trading under the Harvey World Travel and United Travel brands.

More than half the franchisee members of New Zealand’s oldest retail travel network are refusing to sign up with struggling Qantas-backed travel agency network Helloworld ahead of its New Zealand launch next year.

Thirty-six members of New Zealand’s 60-plus United Travel group rejected the Helloworld model, which replaced well-known Australian brands Jetset, Harvey World Travel and American Express Travelscene last year and claims to have about 1000 travel agency members on its books.

“Some franchisees have made the decision that Helloworld is not for them and, while that is disappointing, we are confident that we have a broad network footprint and a strong platform from which to launch Helloworld in New Zealand,” Helloworld told the Australian Securities Exchange.

While the corporate travel sector has held up, bricks and mortar travel agencies have struggled as consumers move online to book their leisure flights, hotels and tours.

Roy Morgan Research shows 47 per cent of Australians booking a holiday in the year to June 2014 used a conventional travel agent and 16 per cent used an online travel agency. This compares to 2007, when 71 per cent of people booking a holiday had taken the bricks and mortar route while 6 per cent had booked online.

Online travel agency Webjet managing director John Guscic recently said Australian consumers were continuing to move online, particularly in the international side of the business. As such, Webjet announced a 41 per cent increase in total transaction values to $646 million for the six months to June 30.

Despite the mass departures of the United Travel network, outgoing Helloworld chief executive Elizabeth Gaines said Helloworld would launch in New Zealand by consolidating several franchisees presently trading under the Harvey World Travel and United Travel brands.

In an unprecedented move, Helloworld would increase its geographical spread with the purchase of 10 retail travel stores from Air New Zealand.

Qantas chief executive Alan Joyce told The Australian earlier this year the airline would retain its 28 per cent stake in the travel agency but a sale of its stake was on the cards.

“Not in the short term, but in the longer term we probably don’t need an investment in that, but (for) the short to medium term it’s a focus on stabilising — not stabilising because the (Helloworld) business is a good business — but improving the performance of the business,” Mr Joyce said in June.

Flight Centre managing director Graham Turner said he was not interested in buying Helloworld because it would be too much of a “distraction”.

United Travel could not be reached for comment.