Tui slows rate of shop closures

Tui slows rate of shop closures

Tui Travel plans to close shops in the UK at a lower rate over the next five years than over the previous three despite the increasing proportion of sales made online, which hit 40% of the total in the three months to June.

The group’s chief financial officer, Will Waggott, told investors last week: “In five years we will probably have 100 fewer shops [in the UK] and it might be as high as 150.”

That would give Tui Travel an average shop-closure rate over the five years of 20-30 outlets a year. The Thomson and First Choice group had 971 outlets in 2008 compared with about 850 today, giving an average closure rate over the past three years near to 40.

A Tui Travel spokesman said: “There is no reason for alarm bells. It is very much business as usual. There is a comparative increase in the share of sales online versus bricks and mortar. We don’t know the ceiling of that.”

He added: “It’s part of the natural fluidity of the retail estate. We don’t what the retail landscape will look like. There may be opportunities we just don’t know about yet.”

Between 20% and 25% of Tui Travel UK shop leases are due to expire over the next five years compared with 40% in January 2008.

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