A total of 408 Romanian travel agencies and tour operators went bankrupt in 2016 and 2017, a survey by KeysFin reveals.
“Most companies that closed their doors were highly financially vulnerable. In most cases, business plans were not aligned with the market, the dynamic of revenues and payment obligations. That is why, as they overestimated their business, many entered financial block,” KeysFin experts said.
Seasonality plays a significant role in the financial dynamics of agencies. As a lot of them do not benefit from financial resources that they can allow to withstand economic challenges, lending, for instance, being at an extremely reduced level in this sector, most have difficulties in withstanding the strong competition of the big market players,” the experts said.
“Overall, Romanian tourism is witnessing a positive trend. The sector’s profitability is forecasted to exceed this year over RON 200 million, double compared to seven years ago,” KeyFin analysts say.
Some of the expenditures have evolved significantly, such as staff costs that were up by about 50 percent in the last five years, but this growth has been reflected positively in the net result – from RON 21.3 million in 2012 to RON 163.2 million, the estimated value for 2017.
The KeysFin analysis shows that the most profitable firm during the period surveyed was Charter Broker SRL, which reported a net profit of RON 6.38 million, followed by Business Travel Turism SRL (RON 5.68 million lei), Happy Tour SRL (RON 5. 61 million), Touring EuropaBus Romania SRL (RON 4.87 million) and Prestige Tours International SRL (RON 4.59 million). In the top 10 most lucrative tourism companies were Travel Time D & R SRL, Christian 76 Tour SRL, Creative Eye SRL, Masiro Travel SRL and Paralela 45 Turism SRL.