SINGAPORE – The winding up of established travel agency STA Travel is a blow to the industry, but no wave of mass closures is expected to follow for now, observers say.

Despite a near-zero business environment, the number of travel agent closures over the last eight months has remained relatively low at 22, about half that of the same period last year, figures from the Singapore Tourism Board (STB) show.

Industry players say this is likely due to the fact that the majority of operators have pared costs and gone into hibernation mode, kept afloat by government support schemes.

Some have also pivoted to sell staycation packages to the domestic market, while agents that cater to inbound tourism are now focusing on Singapore-bound international students.

STA Travel stopped operations earlier this month, prompted by its Swiss-based parent company filing for insolvency. As many as 682 customers may be owed sums ranging from $7 to as much as $84,088, according to a creditors’ notice issued by provisional liquidators from audit firm Deloitte and Touche.

It was the only travel agent closure over a near-eight month period this year that impacted customers, STB said.

Mr Samson Tan, chief executive of GTMC Travel, said the extension of wage subsidies through March next year has been a lifeline for many, while employees are also taking pay cuts, going on training courses and being redeployed during the lull.

GTMC Travel has also moved into a smaller office which it shares with another travel agent to save on rent.

“I think after March if nothing happens and the Government doesn’t extend (wage subsidies), a lot may call it a day. But most can hang on till then,” Mr Tan said.

Chan Brothers Travel said it has received “significant interest” for its recently launched staycation packages, which include hotel stays paired with a guided tour of Sungei Buloh Wetland Reserve.

It is also engaging customers through Facebook live sessions that offer travel tips for popular destinations like Japan and Taiwan when holidays to these places are possible.

Ms Alicia Seah, director of public relations and communications at Dynasty Travel, said the firm is gearing up for the resumption of corporate travel.

As safety considerations and country-specific requirements are now a major concern for travellers, “the role of travel agents will become even more essential post-Covid”, she said.

Mr Steven Ler, president of the National Association of Travel Agents Singapore, said he sees light at the end of the tunnel, given the high demand for structured itineraries and end-to-end travel solutions as business and essential travel pickup.

Singapore’s allowance for bigger conferences of up to 250 people will bring more visitors in the coming months, and the industry is working with ground operators to ensure a smooth process, Mr Ler said.

There is also strong pent-up demand for leisure travel, with wilderness, driving and sailing holidays garnering the most interest.

“Customers want to know what they need to be aware of, such as when they need to undergo the swab test, if they need to be quarantined and whether there is a list of approved places to stay. These are some of the pieces we are trying to pull together,” he said.

He added that travel agents are also looking to bundle insurance offerings that will cover overseas travel.

“We can’t sell any itineraries now, but at least we can get a sense of the potential areas of concern so we can guide customers when things restart,” said Mr Ler.

Ngee Ann Polytechnic senior tourism lecturer Michael Chiam noted that more travel agents may be forced to fold, given the long recovery ahead for the tourism sector.

But there is likely to be a surge in demand for their services as travel restrictions relax.

“Travel preferences and habits may change due to the safety concerns of travellers, so it is important for travel agents to offer innovative (solutions) in order to take advantage of the upward trend,” said Dr Chiam.

Source Article