Are holiday deposits too low? Some agents think so

are deposits too low
By Linsey McNeill
11/01/2024
Home » Are holiday deposits too low? Some agents think so

Agents say cancellations are on the rise, and they’re blaming low deposits coupled with the admin fees charged by operators to change or postpone holidays.

With some operators – including Jet2holidays – charging as little as £60 per person deposit, agents say customers are prepared to cancel and lose their money rather than pay a similar amount or more for the operator to change their booking.

Hays Travel agent Aaron Petty told Travel Gossip that he’d seen a rise in cancellations this month, with five emails on New Year’s Day alone, but he felt clients who found they couldn’t afford the holiday they’d booked would have postponed till next year if they’d been allowed a free amendment.

“The cost of living is definitely playing a part and I know that if there was a policy out there giving customers one free amendment they’d all have moved their bookings if there was something else within budget.”

He suggested that higher deposits might also act as a deterrent to customers considering cancelling. “A customer committing to £150pp deposit is far less likely to cancel as a family of four than someone paying £60pp,” he said.

Responding to Aaron’s post in the Travel Gossip Facebook group, some agents agreed that deposits were too low, leading to customers booking then changing their minds later, but some warned that higher deposits could lead to fewer bookings.

“I think we need to consider the majority of bookings,” said Julie Beckon of Earthwise Travel. “The majority don’t want to move or cancel. If deposits were raised, it would put people off booking. The biggest reason I get for people not booking in the first place is that the deposit is too high, in cases where it is £150+pp.

“If we had higher deposits we wouldn’t get the bookings in the first place, they would just go to Loveholidays or On the Beach instead.

“I’d rather keep the admin fees and potentially lose a few bookings here and there, rather than get fewer bookings on the off-chance they might want to amend/cancel at a later.”

Other agents also warned that lower or zero admin fees would create more work for agents. 

One pointed out that when some airlines and operators allowed free admendments during the pandemic customers requested multiple changes – for which agents didn’t get paid – then went on to cancel anyway.

Steph Pitcher Blackhall, also of Hays Travel, suggested admin fees should be less than the deposit to encourage clients to change rather than cancel their holidays. “If it’s free they will amend for the sake of it with no intention of travelling (not all obviously),” she said, while pointing out that admin fees that are close to or more than the deposit simply encourage clients to cancel and rebook later.

Lisa Russell of Wanderluxe By Lisa is among a number of agents who have started introducing their own admin fees for amendments and cancellations, in addition to any operators’ fees.

She told Travel Gossip that the level of changes requested by customers had ‘really got her goat’ at the end of last year, adding: “Many suppliers don’t give any commission – or give very little commission – for cancellations.”

Lisa said she has recently amended her terms and conditions to include services charges from £25 for a name change up to £50pp plus 1% of the original holiday cost for a cancellation, plus 3% to process a refund.

“I will say I am worried about doing it, but I need to value myself more and my time,” added Lisa.

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