Flight Centre is re-employing redundant travel agents as freelancers

Flight Centre says it is re-employing travel agents it let go during the pandemic, but on their terms, and is seeing a rise in demand for sales people setting up freelance gigs as the appetite for international travel returns.

The travel agency group dramatically cut its workforce through the Covid pandemic as the border closed and demand for travel dried up.

However, as airfares start to show signs of becoming more affordable and travel is largely back on the agenda for many, more travel agents are returning to the industry, says Jason Buckley, general manager of Flight Travel Group Independent.

Buckley said Flight Centre’s contracting model had been around since 2002, originally created as an alternative for travel agents who had young families and needed to leave its shops and work from home.

The traditional model was travel agents worked in the Flight Centre stores. But interest had been growing in more established agents contracting. They wanted more flexibility in location or hours, and had established client contact books they could draw on, he said.

“A lot of them have got other jobs, they might be working for banks or insurance companies. Some are working for tourist boards, and in then in their spare time they are travel professionals running their travel businesses.”

Buckley said a lot were in the regions and saw it as an alternative to having to come back into a 9 to 5 travel agency job to book flight and accommodation with the freedom to do “bits and pieces” around it.

“They’ve got customers they have already connected with and basically just work with those customers to nurture those relationships.

“The really successful ones have kept really well-connected with customers in their communities. It is not all branded Flight Centre either, we have different broker groups too, and you can also be your own brand.

“We get a lot of niche and bespoke operators, such as marathon specialists and ‘bum tums and mums’, a lady that does a lot of trips to Thailand for people who want to get their lips and bodies done.”

Flight Centre still saw value in its traditional bricks and mortar model, but the rise in contracting agents would eventually outstrip those in its stores, Buckley said.

“People in our industry after Covid were reluctant to rush back into it because they weren’t quite sure what was going to happen.

Flight Centre has shrunk its retail network from 135 stores pre-pandemic to just 35 stores.

Buckley said travel agents joining Flight Travel Group Independent were a mix of former Flight Centre agents and others from industry competitors and group.

It has about 250 contracting agents and staff on its books, versus about 267 staff directly employed in its stores. The agents make money from commission from booking volumes and charging fees for their time and there was no financial difference for Flight Centre if the staff were working from shops or not.

Buckley said the number of independent contractors had grown by 5% over the past year, meanwhile revenues have grown by 130%, attributed to the high prices for airfares and accommodation.

‘Airfares to become cheaper’

Appetite for travel has come back strongly in recent months, with more people taking trips to the Pacific Islands or Europe to escape winter as they typically would pre-Covid.

Prices for airfares and accommodation had started to “slide down”, Buckley said.

Consumers could expect to see fares to come down over the next few months and more inline with pre-pandemic rates as more airlines returned to New Zealand and more routes were reinstated.

Qantas has launched a direct Auckland to New York service and United Airlines was returning to Christchurch, he said.

He said Flight Centre had noticed a growing trend among retirees now “catch up playing” – booking multiple trips throughout the year, compared to previously booking one big trip in a year.