Lessons from the collapse of Thomas Cook

Sep 24, 2019

The oldest travel company in the world has just collapsed. It was way ahead of its time when it was founded. What can we learn from Thomas Cook?

 

The world oldest travel company just collapsed.

 

This week, Thomas Cook, the world’s oldest travel company, founded in 1841, by cabinet maker and Baptist Minister of the same name, went into compulsory liquidation.

 

This happens when a company is unable to meet its debts as they fall due.

 

Many factors have been blamed for that.

 

Everything from Brexit, to the unusually warm summer, to the actions of certain hedge funds.

 

What I found interesting while researching this article, was how the obvious reason was seldom cited.

 

And that’s that 4 out of 5 of Thomas Cook’s customers, had now moved to “do it yourself” travel arrangements, through the likes of Expedia, Booking.com, etc.

 

Thomas Cook was founded to provide affordable travel through the United Kingdom.  That was effectively global travel, since in those days, the “sun never set on the British Empire”.  It survived, 2 world wars and a great depression.

 

Growing up, I remembered Thomas Cook travelers’ cheques.

 

Thanks to the rise of credit cards, ATM networks, and internet banking, travelers’ cheques are now a distant memory.

 

Like travelers’ cheques, and travel booking agencies, all of us need to evolve to take advantage of new technologies, or fade into the past.

 

In the UK alone, 20,000 Thomas Cook employees have been affected by its liquidation.

 

In fact, a member of my team has just consulted with a former travel agency employee who wants to start learning how to market travel services online.  (I don’t know where this person was employed as he had declined to disclose that information.)

 

It’s great to see him taking action now.  It will be tough going, but he’ll be able to learn to use automation that will allow him and his computer to do what many of his colleagues used to do.  There’s a good chance that with automation as a business owner, he might end up making more than what he used to.

 

But he could have made it easier on himself.

 

I’ve often said that the best time to learn to make hay is while the sun’s still shining.

 

Don’t leave it until you “have to”, to learn a new skill.

 

Yes, it is tough learning to start a new business while still being employed.  However, the employment ensures cash flow, and cash flow enables you to make better, less stress driven decisions for your business.

 

I personally worked 12-15 hour days.  I worked on my business after that.  Within 6 months I had replaced the income from my corporate law job.

 

(I should add that I didn't know at that point if I could make any money at all, since with all businesses there are no guarantees.)

 

It definitely involved sacrifice, but looking back, it was certainly worthwhile for me. 

 

Whether or not it's worth that sacrifice is something you need to decide.

 

 


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