The Rise and Fall of Thomas Cook
Following its collapse, it has been a devastating week for Thomas Cook, resulting in thousands of job losses as well as 150,000 holidaymakers being stranded across the world.
As the world’s first tour operator, Thomas Cook began in 1841 offering train trips across England before going international 14 years later and introducing a “package” holiday experience. This new initiative included travel, food and accommodation.
Before long, the firm opened its first shop, and later in 1919 began offering holidays by air, making it the first UK travel agent to do so. Over time, Thomas Cook continued to develop and grow, including in 1997 when they became the first travel agency to offer holidays and currency online.
As one of the best known, international tour operators and with over 560 high street shops, Thomas Cook really was a leader in the travel industry.
So, where did it all go wrong?
After merging with the Co-operative group and the Midlands Co-operative in the UK in 2011, the company showed signs of difficulty when debts mounted to almost £1bn.
Earlier this year, the company showed further signs of instability as 21 stores closed and 320 jobs were lost. Reports later showed that the company also made a loss in the first half of 2019.
Although the exact causes of the company’s difficulties are yet to be revealed, a variety of reasons have been reported, including unsuccessful mergers. Another reason was a change in consumer behaviour, with more customers booking holidays online instead of visiting stores. Like other businesses, they have also held Brexit responsible, as the ongoing uncertainty around it led to fewer people booking holidays.
After a failed rescue deal and being refused government funding to fill a £200m deficit, Thomas Cook officially fell into complete liquidation on Monday 23rd September and ceased all trading.
Having one of the most recognised slogans, “Don’t just book it, Thomas Cook it!”, and a long history of success, it is upsetting to see the end of an era for such a prominent player in the travel industry. Over the next few weeks, it will be interesting to see how customers and employees are supported through this challenging time and whether the investigations into the cause of the collapse of the company result in any action against the directors of the company for mismanagement.
If you’re worried that your business may become insolvent, either as a result of the difficulties being experienced by Thomas Cook, or otherwise, or require advice regarding potential action against directors in the event of the failure of a company, you should seek advice from a licensed insolvency practitioner as soon as possible. At Chamberlain & Co, our experienced insolvency practitioners will work closely with you to make sure they give you the best advice for your business. For more information, please give us a call on 0113 2420808 or contact us here.
