Cumbrian Cottages swallowed up by Hoseasons

[charles cawley]

As money gets tight so the lower end of quality becomes unsaleable at any price. Demand falls away and the price of higher quality falls so muscling out the lower quality offerings.

There is a chance that lower quality demand may hold up with transfer of holidays from foreign to domestic, but it is more likely that people will just cut the number of holidays they take.

There will always be a demand for quality as long as the price is right. But moderate or poor quality can become unsaleable at any price with better alternatives available. That is the nature of the market.

Yes, if the worst fears of this oncoming economic tsunami are realised, it is possible that everything shall change. Even then, unless demand for domestic self catering holidays rises, the odds remain that realistically priced good to high quality cottages will mop up demand leaving moderate and low quality cottages high and dry. The idea that people with less money will trade down quality is countered by higher quality at lower cost on offer.

The alternative for high quality unwilling to set realistic rates is to leave the self catering market and try another avenue of business. Some may do this, but it is more likely that lower quality cottages will choose this route. This appears to already be happening now.

[kendalcottages]

So, by the sounds of it, you are saying that Hoseasons is going to struggle this year, and potentially be in dire straits next year. Personally, I don't believe that will be the case.

[charles cawley]

We are all going to have a tough year and 2014 could be even tougher. The magic money hopes of the Politicians cannot go on for ever without major social change. What change is another matter but it is coming.

[starcana]

Just another view. . . You know I'm with Hoseasons. yes, they irritate me (especially the website problems as they changed over in the past couple of months and the introduction of Reevoo which gives some quite bizarre ratings compared to comments)
BUT
for me (and that's the only person Ican speak for
- They deliver high volume bookings at a good price
-It is pretty hassle free - they do all the work, marketing, bookings, info, directions etc
- I can and do communicate with my guests prior and after booking/stay
-they communicate with me and take my communications with them efficiently

But I still do have some niggles, as above

[kendalcottages]

We are all going to have a tough year and 2014 could be even tougher.

By that do you mean all self-caterers, all agencies, or all self-catering in the UK? Regardless of the current economic conditions, I'm not really sure how you can accurately speak for the businesses of others - even if 2013 is to turn out to be a difficult year for many, there will be some who will buck the trend.

They [Hoseasons] deliver high volume bookings at a good price

This is my experience of them as both someone who works with them (not with KC, but in my day job) and someone who has booked through them on a couple of occasions.

Whilst traditionally they have been very much brochure driven, I don't believe this is their main source of revenue any longer as Charles seems to suggest earlier in this thread, though I have no evidence/proof either way - I just know they have a very successful affiliate program.

Interestingly, the time I last booked through them (a few years ago now), it was for a resort in Cornwall. Hoseasons offered a competitive rate that was cheaper than booking direct. I approached the resort, told them the rate I was getting via Hoseasons and asked whether they could compete with it. They said they couldn't which kind of didn't make sense to me, knowing that they would be receiving around 20% less than I was paying when they got the money from Hoseasons but hey ho...

[charles cawley]

I think starcana made the remark about volumes and price. We charge 17% +vat with no other charges whatsoever. Some booking agency prices can, sometimes, charge very much higher. I have heard of 26% and more plus vat. Before charges for visits, photos, membership charges etc:. Contract notice terms vary. Ours is three months rolling, undertaking to honour comittments made. I am told some large agencies expect 12 months and can set quite a large fee for early release. In some cases, there is the astonishing practice of charging commission on private lets.

Our headline commission rates inc vat are 20.4% compared to 31% for some other agencies before any other extra charges on top. If anyone has experience of what Hoseasons charges, it would be interesting to hear; a company with a bright future might not be able sustain such methods of operation in harsh economic conditions. Some agencies may buck the trend, but any business which has such a vast share of the market may have a very serious problem bucking any trend.

The UK commercial property market once used to charge letting premiums and all legal and other fees to the incoming tenant with upwards only rent reviews. All that is history. A similar revolution could happen in this market.

We would never market an arrangement where rates through us would be less than those offered directly by the owner unless the owner specifically requested. We have had people ring us up and try to strong arm owners by getting lower quotes from us. We tell them politely that they should ask the people who employ us as their agent.

I fully understand why the owners acted that way. They clearly value the arrangement with Hoseasons and do not wish to undermine it. A similar logic applies if you approach manufacturers or wholesalers direct; often they quote retail prices to avoid upsetting the main outlets for their products.

I forgot... edit... We are all going to have a tough year. There will be a few exceptions, but the economic wave coming our way should not be underestimated. Politicians may say soothing things, but the fundamentals are not working right however much the BBC or the EU grandees may say to the contrary.

[Lindisfarne]

ECC / C4Y standard commission rate is 27% plus VAT - They also deduct a booking fee of circa £ 40 from the headline price which on a £ 700 booking converts to around 6% - This is paid by the owner

On top of that they charge an annual listing fee - Can't recall but I think it's around the £ 50 mark

[charles cawley]

Astonishing. Thank you.

Our booking fee is £27 inc vat.

Some other agencies go lower to £15.

[Essar]

Wyndhams have now done a deal with HA to include all their time share properties as part of the HA commission based listings that they had been trialling with agencies.

That's something like another 16,000 properties on HA!

[Lindisfarne]

Astonishing - The giant machines keep getting bigger and feed each other

Will there eventually be consolidation into a super force ?

[Nemo]

That's something like another 16,000 properties on HA!

Too much choice can make a decision impossible to reach on which property to rent and is a complete time waster; unless as a guest, you know exactly where you want to go and if the site has incredibly good search facilities.

[Windy]

Yup Nemo - Social psychologists call it the "Tyranny of Choice"

http://www.economist.com/node/17723028

In one landmark experiment, conducted in an upmarket grocery store in California, researchers set up a sampling table with a display of jams. In the first test they offered a tempting array of 24 different jams to taste; on a different day they displayed just six. Shoppers who took part in the sampling were rewarded with a discount voucher to buy any jam of the same brand in the store. It turned out that more shoppers stopped at the display when there were 24 jams. But when it came to buying afterwards, fully 30% of those who stopped at the six-jam table went on to purchase a pot, against merely 3% of those who were faced with the selection of 24.
Expectations have been inflated to such an extent that people think the perfect choice exists

The researchers repeated the experiment with chocolate as well as student essay topics and found similar results.

It's not to much of a stretch to apply the same thinking to listing sites is it?

[kendalcottages]

Surely if you're faced with 24 different jams versus 24 different types of chocolate, you'd get very different results!

[domino]

Just a 'heads up' to people advertising on Hoseasons sites.
We were looking for a holiday cottage in a very specific area recently. We finally, after many hours trawling through very poor listing site/ websites, decided to phone with a few pre booking queries. We asked if we could talk directly to the owner, this request was refused. The person taking our call then said he would contact the owner but before doing so needed our credit card details
We choose not to do this and found alternative accomodation.
I wonder how many potential guests are lost this way?
Incidentally we finally booked through a very small local letting agent who arranged for us to converse with the owners directly.
Small is definitely beautiful

[Lindisfarne]

Hi domino
I think the reasons they did not give you the owner contact details are :-

Firstly I don't think they can pass out numbers without checking it's OK to do so with the owner, data protection etc. ( also they may be on holiday or otherwise engaged )

Secondly they are paid a huge commissions each year by the owner to field such calls and should be trained to turn enquiries into bookings - Why have a dog and bark yourself ?

Having said that I do agree that owner listing websites where you can make direct contact are the best way forward