What role does Brexit play behind the bankruptcy of Thomas Cook, the originator of travel agencies?

Brexit has really become a hot topic in the world now. Who would have thought that the former British Empire, which never set in the sun, is now in such a mess? This is not the world's first travel agency, Thomas Cook (China branch named "Tommy Cooker"), a 178-year-old British travel company that experienced two world wars, has come to the end of bankruptcy. It is said that the impact of poor management and digital transformation of the industry is on the one hand, but Brexit is also hard to blame. The main reason is that after the referendum on Brexit in 216, the pound plummeted, making it even more difficult for Thomas Cook, which has been internationalized but heavily in debt, to breathe.

Branson, chairman of British Virgin Group, said that all costs in the tourism industry, such as fuel supply and aircraft leasing, are settled in US dollars, and once the pound weakens, corporate costs will inevitably rise. For Thomas Cook, this means the end point. In fact, since the British referendum decided to leave the European Union in 216, the pound has shrunk by nearly 2%. It is equivalent to a direct increase of 25% in the company's operating costs on the basis of maintaining the original operation.

and not only that, the chain effect has just begun, and the pound has shrunk, resulting in a sharp decline in the spending power of British overseas travelers. However, the company generally sells its own flights and hotel room services through physical stores, and the profit margin is not large. However, due to cost reasons, as an international enterprise, the cost performance ratio is definitely not as good as that of local hotels. In the case of shrinking pound, travelers have higher requirements for cost performance. Income is even more difficult to maintain.

In addition, the Brexit storm has also reduced the demand for travel in the UK, and the century-old tradition and service of the reform enterprise have also weakened the attraction to consumers. In addition, the continuous uncertainty brought by Brexit has also made many international tourists directly "scared away".

However, this enterprise had long accumulated disadvantages and struggled to operate before, and Brexit was the last straw to crush this enterprise.