Simon Calder: The company remains a robust and going concern

Suppose, at the start of the year, you had 100 shares in Thomas Cook. At £2 each, you could have made enough for a package holiday to the Med. While there are still plenty of £199 deals, selling the shares at yesterday's price would not even buy a one-way ticket on the Gatwick Express.

Thomas Cook is the strongest brand in travel, with a tradition that stretches back 170 years. So how could it go so badly wrong? Partly misfortune, and partly mismanagement.

It is easy for fellow countrymen of Thomas Cook (the person) to imagine that Thomas Cook (the company) is composed only of high-street travel agencies selling mainstream package holidays with flights on Thomas Cook Airlines. In fact, Thomas Cook (the multinational business) is a lot more complicated – which could, ultimately, prove its salvation.

The move into Russia was, as they say, a good idea at the time. But key destinations for Russians are Egypt and Thailand. When the former overheated and the latter overflowed, bookings were hammered. Bad luck, but the one certainty in this industry of human happiness is that things will always go wrong – and holiday firms need deep pockets to respond. Mr Cook's pockets were once happily filled with earnings from the package holiday business.

Unfortunately, the internet bestowed anyone with a broadband connection the ability to assemble flights, hotels and a rental car. The past couple of years, from ash cloud to Arab Spring, have also been particularly cruel to Thomas Cook, but the firm should have moved away from commoditised two-star Mediterranean holidays much earlier.

The management failed to read its own brochure – at least the current Club 18-30 edition. It explains: "We're always changing. That's because you are always changing too. New fashions. New music. New attitudes." Arch-rival Tui realised much earlier that the future lies in differentiation, in specialist adventure and activity holidays, and in combining brand and brute force in the market place to deliver outstanding experiences at competitive prices. The collapse of the share price does not presage the biggest collapse in travel – unless fearful customers shy away from Thomas Cook in the post-Christmas sales surge. I'll be buying, knowing that my money is safe thanks to Atol protection, and confident the holiday will go ahead.

The firm remains a robust organisation and going concern, but five years from now will be a lot leaner and fitter. Which, sadly, means job losses. Thomas Cook's core strength is that it remains a trusted brand, which is just what travellers need when stepping out of the comfort zone.

Start your day with The Independent, sign up for daily news emails
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Evening Administrator

£8 per hour: Recruitment Genius: This Pension Specialist was established early...

Guru Careers: Executive Assistant / PA

£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...

Ashdown Group: Graduate Application Support Analyst

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Reach Volunteering: External Finance Trustee Needed!

Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...

Day In a Page

War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable
Living with Alzheimer's: What is it really like to be diagnosed with early-onset dementia?

What is it like to live with Alzheimer's?

Depicting early-onset Alzheimer's, the film 'Still Alice' had a profound effect on Joy Watson, who lives with the illness. She tells Kate Hilpern how she's coped with the diagnosis
The Internet of Things: Meet the British salesman who gave real-world items a virtual life

Setting in motion the Internet of Things

British salesman Kevin Ashton gave real-world items a virtual life
Election 2015: Latest polling reveals Tories and Labour on course to win the same number of seats - with the SNP holding the balance of power

Election 2015: A dead heat between Mr Bean and Dick Dastardly!

Lord Ashcroft reveals latest polling – and which character voters associate with each leader
Audiences queue up for 'true stories told live' as cult competition The Moth goes global

Cult competition The Moth goes global

The non-profit 'slam storytelling' competition was founded in 1997 by the novelist George Dawes Green and has seen Malcolm Gladwell, Salman Rushdie and Molly Ringwald all take their turn at the mic
Pakistani women come out fighting: A hard-hitting play focuses on female Muslim boxers

Pakistani women come out fighting

Hard-hitting new play 'No Guts, No Heart, No Glory' focuses on female Muslim boxers
Leonora Carrington transcended her stolid background to become an avant garde star

Surreal deal: Leonora Carrington

The artist transcended her stolid background to become an avant garde star
LGBT History Month: Pupils discuss topics from Sappho to same-sex marriage

Education: LGBT History Month

Pupils have been discussing topics from Sappho to same-sex marriage
11 best gel eyeliners

Go bold this season: 11 best gel eyeliners

Use an ink pot eyeliner to go bold on the eyes with this season's feline flicked winged liner
Cricket World Cup 2015: Tournament runs riot to make the event more hit than miss...

Cricket World Cup runs riot to make the event more hit than miss...

The tournament has reached its halfway mark and scores of 300 and amazing catches abound. One thing never changes, though – everyone loves beating England
Katarina Johnson-Thompson: Heptathlete ready to jump at first major title

Katarina Johnson-Thompson: Ready to jump at first major title

After her 2014 was ruined by injury, 21-year-old Briton is leading pentathlete going into this week’s European Indoors. Now she intends to turn form into gold
Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot