tour operators going bust

[dockingtrade]

In the last few years there has thousands caught out because of tour operators and online booking sites going bust. If you pay up front that means the money is there to to pay for the room. Should it not be the case as it is so common now that these companies have to pay the hotel etc when the booking is made and they just retain their cut. So if they go bust they go bust but if you pay for a holiday you dont get stranaded?

 

[tiger]

[broken link removed]
I think the problem arises not when the tour operator goes bust, but when people organise the holiday themselves (flight, hotel, carhire, etc.) and one of those elements fails. Then you fall under a different area of consumer law.

 

[Homer]

I expect that in practice, that's what's supposed to happen. But the only way you can be sure the reservation goes through is if you make the payment directly to the hotel and they then pay the commission to the tour operator. In practice, I think the tour operators block book the rooms at a discount and then sell them on members of the public. Even if the hotels insisted that they are upfront by the tour operator, this would provide no guarantee of a room as the tour operator could (in theory at least) book each room several times over.

I guess the only protection is to either book directly with the hotel or only book through fully bonded tour operators. I don't know if multi trip travel insurance policies provide cover against a tour operator defaulting, but maybe some of them do.

 

[terrontress]

I'd imagine that this would make holidays more expensive. Being extended credit is normal in every industry.

The only way around this as a consumer is to pay using your credit card. If the whole company fails then you will get your refund.

 

[Latrade]

I thought the problem in this case (and in other cheaper operators) is that they sell the packages below cost. They buy them from the hotels for a set price but have been selling them cheaper to the public. Eventually the money will run out.

 

[terrontress]

I thought the problem in this case (and in other cheaper operators) is that they sell the packages below cost. They buy them from the hotels for a set price but have been selling them cheaper to the public. Eventually the money will run out.

Doesn't make good business sense to me.

It is obviously a tough market to be in, given the numbers going to the wall.

 

[redwood park]

I would much prefer to book directly with the hotel online or over the phone but hotels in general, especially in mainland Europe, charge much more than Booking Agents. They encourage you to book with an agent if you query price. I cannot understand this as they have to pay agents a commission. Online bookings cost hotel nothing. I find that you get a better rate for Irish hotels over the phone but check online rate first.

 

[Grizzly]

Some of the bigger chains of hotels offer a Best Price Guarantee on their websites. Last year I found that Alpharooms was offering a better price than the hotel. I phoned the hotel's head office and called on their guarantee. I was offered free wine plus water with my half board booking. I said I didn't want this but could I have an upgrade to a seaview room in it's place. Got it.