Some Thomas Cook shops ‘extremely profitable’ say new owners
Hays Travel says only a small minority of the 555 Thomas Cook shops it acquired this week were unprofitable.
In fact, Irene Hays, who orchestrated the acquisition with her husband and Hays’ co-founder and co-owner John Hays, said many were ‘extremely profitable’.
Hays Travel has bought the entire Thomas Cook retail estate from the liquidators following Thomas Cook’s collapse last month.
It’s widely believed that Thomas Cook’s huge investment in bricks and mortar retailers was one of the reasons for its collapse, but Irene Hays said that without Thomas Cook’s high head office overheads, all the shops should turn a profit.
Several of the stores re-opened this morning and more are being opened up every hour, added Irene, who is keen to see them all trading again asap.
“It’s a complex operation,” added John Hays, “some of the shops have things like cash registers and other things that, for GDPR reasons, have to be removed. There are niggly things as well, like getting the keys from the liquidators, but we’re getting them opened as fast as we can.”
Hays has hired 769 former Thomas Cook staff so far, and it has another 180 lined up to join. It is keen to hire more of the chain’s 2,500 UK retail staff who lost their jobs without notice when the company collapsed.
When asked about salaries, Irene said they were ‘comparable with Thomas Cook, to the best of my knowledge’, but she said shop overheads would be a lot lower due to reduced head office costs, both in terms of rents and wages.
She said that while Hays was keen to recruit Thomas Cook retail staff, it wasn’t planning to hire any of its senior managers, whose high salaries have been publicly criticised.
“When you look at the rateable value per square foot of office space in Sunderland [where Hays Travel is based] compared with Peterborough [location of Thomas Cook’s HQ], it’s vastly cheaper,” said Irene.
“We have run three different scenarios and in each of them there are significant saving from both overheads and senior management.”
High rents on some of the Thomas Cook stores are also a concern, but John said Hays wasn’t intending to renegotiate any of the leases until they come up for renewal. Hays has already paid the rent on all the shops until Christmas Eve, handing over the money to the liquidator as part of the deal, and it has a nine-month licence to occupy all of the stores.
“Our priority was to get the leases, not to renegotiate,” he said. “We are going in on the same terms.”
“During the next nine months, we’ll be trying to make sure we build up a relationship with the landlords,” added Irene.
John and Irene revealed that had they not been successful in snapping up Thomas Cook’s stores, they were prepared to appoint homeworkers in every location where there was a shop.
Hays had already hired almost 600 of Thomas Cook’s former staff and bought 1,000 laptops ready for distribution to its new employees prior to getting the deal over the line with the liquidators at 11.53 on Tuesday evening.
“We recruited people in the hope that they would become homeworkers,” said Irene. “We didn’t know if we were to get the Thomas Cook shops but if we had not been successful we would have gone into all those places anyway.”