Profit myths?

[Kindersley]

Now some will be shocked at finding out how much a dealer makes on a domestic boiler boiler etc ? ( peanuts!)

After hearing about these massive holiday companies going bust etc , I was shocked to hear on a family of four package holiday etc the company could expect to make only £3-4.50 a booking !!!

what else is there bugger all profit in ?

[johnfm]

replica watches?

[Dracoro]

Kindersley said:

Now some will be shocked at finding out how much a dealer makes on a domestic boiler boiler etc ? ( peanuts!)

After hearing about these massive holiday companies going bust etc , I was shocked to hear on a family of four package holiday etc the company could expect to make only £3-4.50 a booking !!!

what else is there bugger all profit in ?

Petrol. if it's profit per unit.

As with your holiday company examples, it will come down to how many sales they make.

Also, I suspect they get somewhat more than a few quid per booking.
I assume there will be block bookings, exclusivity deals, cuts on other parts of the deal and so on.

[GTIR]

Banking.

[ZOLLAR]

Car insurance, in alot of cases there is loss.

[Kindersley]

johnfm said:

replica watches?

If excellent then i was working on 100% min. Best ever was 300% on the very first batch of Hublot 27 years ago

[Plotloss]

More than you'd realise and the internet has a big role in making it that way.

[v8will]

Almost everything these days.

I work for an online business and the 2 biggest problems have been Ebay and other retailers who are hell bent on advertising products at below cost price, of course we advertise at the correct amount but try tell the customer that.

[mat13]

Cigarettes, I can't remember the exact figure but I think the shop only makes around 12p on a pack of 20.

[plg]

WIth the number of ravel operators going bust this year... my guess is the ABTA bond fees will rise sharply... I'm shocked that they are so low...

http://www.abta.com/join/member_introduction/bond

So if you want to run a travel company your overheads can be as low as:

• Call centre or office
• Web presence
• ABTA bond
• Rep of some form (presumably can be outsourced / agency)

With a flow of:
Commit volume to hotel
Client pays
Sit on cash
Pay airline
Pay hotel
Manage to 95%+ utilisation

But in a highly commoditised business with little differentiation in the bulk market of 7 days in Corfu, etc. Only margin is in niche, specialist and high end holidays?

[Papoo]

Economy airline tickets.

[Carlique]

This doesn't surprise me. Me and my mates worked out how much our holiday would have cost us if we had arranged everything ourselfs and the Travel Agents was only making about £12 per person. All the time and hastle it would have taken us it was worth the extra by a mile.

[Carlique]

This doesn't surprise me. Me and my mates worked out how much our holiday would have cost us if we had arranged everything ourselfs and the Travel Agents was only making about £12 per person. All the time and hastle it would have taken us it was worth the extra by a mile.

[PintOfKittens]

Carlique said:

This doesn't surprise me. Me and my mates worked out how much our holiday would have cost us if we had arranged everything ourselfs and the Travel Agents was only making about £12 per person. All the time and hastle it would have taken us it was worth the extra by a mile.

If you arranged it yourself, you wouldnt be covered by their ATOL license.

Typical markup is about 15% for flights, hotels and cruises, I used to work for a travel agency on their IT systems (and built a few)

[ZesPak]

I work as an IT consultant, and have to give a margin of only 15%, not to be competitive, that would mean 5%, but to be reasonable...

As said, the internet has a lot to do with that.

[Syd knee]

ZOLLAR said:

Car insurance, in alot of cases there is loss.

So perhaps they should realise their current models dont work and realise that age, cc and ocupation are not the be all and end all.

[julian64]

Syd knee said:

ZOLLAR said:

Car insurance, in alot of cases there is loss.

So perhaps they should realise their current models dont work and realise that age, cc and ocupation are not the be all and end all.

Two, very unlikely opinions in one post.

[Four Cofffee]

Dracoro said:

Kindersley said:

Now some will be shocked at finding out how much a dealer makes on a domestic boiler boiler etc ? ( peanuts!)

After hearing about these massive holiday companies going bust etc , I was shocked to hear on a family of four package holiday etc the company could expect to make only £3-4.50 a booking !!!

what else is there bugger all profit in ?

Petrol. if it's profit per unit.

As with your holiday company examples, it will come down to how many sales they make.

Also, I suspect they get somewhat more than a few quid per booking.
I assume there will be block bookings, exclusivity deals, cuts on other parts of the deal and so on.

Excursions, flight upgrades, insurance, parking etc????

[J T]

ZOLLAR said:

Car insurance, in alot of cases there is loss.

Are you considering the money they can make on the investment of all the premiums?

[ThePainter]

J T said:

ZOLLAR said:

Car insurance, in alot of cases there is loss.

Are you considering the money they can make on the investment of all the premiums?

And the money they make from cross selling home contents insurance, international/holiday travel insurance, fees they charge law firms for claims referrals, fees they charge law firms merely to get on their panels to receive such work, money made from providing a "courtesy car" to no fault accident victims, fees paid by accident repair clinics, profits made by the law firms owned by the insurance companies relating to those claims, extortionate admin fees whenever you move house or change a policy, once it has been incepted. There is a lot more but we'll stop here...

Yes, car insurance might appear competitive, but they make LOTS of money in this business.