A peer-to-peer marketplace that gives holidaymakers a platform to sell unused and non-refundable holidays is testing the market ahead of its launch – planned for the end of the year.
UK start-up Transfertravel.com lists package holidays, flights, hotel rooms and train tickets that people want to sell because they can’t get a refund or amendment.
British founder Simon Powell stumbled upon the idea after he split from his ex-partner and couldn’t find a way to get any money back from his £2,500 Dubai holiday.
He told Travolution: “The fundamental thing to people booking a holiday is the face value price. You don’t book a holiday thinking you are going to cancel it.
“Seventy percent of people book the non-refundable option because it’s cheaper.”
Powell said most people looking to sell unwanted holidays have fallen ill, are short on cash having lost a job or – as he found out first-hand – been involved in a relationship breakdown.
“Circumstances change because people book months in advance,” he said. “And travel insurance doesn’t pay out in most of those cases. It’s not their fault.
“We even had a honeymoon go on sale because the couple weren’t together anymore.”
The site went online on July 1, but has not been making any money as the plan is to test the market and see if there’s an appetite for the platform.
Now Powell is confident of his place in a reported £17 billion marketplace, he’s going to start taking a seller’s fee – expected to be 10% – on transactions from the end of November alongside a re-launch of the site.
Transfertravel is not the only site to have identified this market as an opportunity. Roomer Travel and Cancelon are already offering a similar service in the US.
“Where we want to be different,” explained Powell, “is that we want to be involved in the validation process. In the same way you see with ticket listings sites. Otherwise we are just a travel Gumtree.”
Budget flights and cheap hotel rooms tend not to make an appearance on traveltransfer.com because the cost of changing name – paid for by the seller – is often too high.
“What we are finding is that pretty much every hotel is transferable in terms of names,” added Powell.
“There is existing travel regulation which stipulates that you have to, by law, allow someone to change bookings. Flights are sometimes more difficult because of security issues.”
The Isle of Man-registered site currently has over 600 active listings, upwards of 2,000 registered users and more than 1,000 visitors per day. Currently, 70% of listings come from the US.
Powell said the vast majority of listings have been in leisure travel but he wants to explore the business travel market and is currently speaking to travel insurance companies about putting customers in touch with him as a “last chance saloon” of recouping some of their cash.
In 2012, the BBC reported that £10 billion is “wasted” every year on unused pre-paid hotel room and a further £7 billion on unused seats on flights.
But Powell says they are not left empty, as airlines and hoteliers re-sell them.
“Airlines, hotels and holiday companies are not going to like us right now,” he said. “For every booking we sell, it’s one less new one in the marketplace.”
But on the flipside, he added, companies pocket the name change fee every time his site engineers a sale.
Powell’s vision for the future?
“We want to create a true last minute website. We are not flexible, but instead of going to Thomas Cook and booking a last minute holiday, you’ll be able to save a lot of money – up to 50% in cases.”