Update from a recent trip to the Republic of South Africa

RSA store

New Hyde Park Shopping Centre Store

Chris Galanty from the UK, CFO Andrew Flannery and I visited RSA Head Office, Hyde Park shop and the Sandton Shopping Centre in South Africa last week. We were hosted by the Flight Centre Limited Managing Director, Janine Salame. My general impression is one of good feelings, good morale and a generally high level of competency. A very experienced senior team, well lead and getting good results in Rand.

One major and quite pleasing difference from my last visit is that our People are now 26% African compared with maybe 1% some years ago and this % is rising fast. The major secret seems to be an African recruiter who can recruit successfully not only for sales and business success but also for cultural alignment with our company.

Results

Generally good with Profit and Transfer well up overall, and Sales staff numbers have increased. Corporate Travel has enjoyed strong growth and the Flight Centre brand is currently growing more slowly.

Advertising in RSA

Premium airfares – interestingly there seems to be a reluctance to advertise and sell enough premium fares and mixed unique to FCL fares. Which makes a great opportunity for our special and unique Red Label fares in the Flight Centre Brand and Black Label in Student Flights. We also still seem to be fairly weak in Cruising and Touring. The Rand is weak but still a good market for these travel products.

Growth in South Africa for FCL

With the Flight Centre Brand in most Shopping centres throughout RSA and not much opportunity outside them there are some issues with growing Leisure. Corporate growth opportunity is unlimited.

We visited Standton Shopping Centre which is one of the largest in the Republic. A new Hyperstore is under construction there for us but I predict at least two more Flight Centre locations as well as a Student Flights and Cruisabout store over the next couple of years.

I’d like to thank Janine and her team for her hospitality and a great night at the Fish Restaurant with some good South African Shiraz and Pinot. Best of luck in 2014 and what is shaping up to be a very good profit result. Pity about the Rand being weak!! Skroo

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About Skroo Turner

Graham 'Skroo' Turner was raised near Stanthorpe, and trained as a veterinary surgeon. In 1973, he and two mates bought a couple of double-decker buses in England and began a holiday travel company, Top Deck Travel.

One thought on “Update from a recent trip to the Republic of South Africa

  1. Janine

    Thank you Skroo.
    The South African leadership team is extremely excited about our Brands growth strategy. We are confident in achieving great sales and profit growth inline with our expectations.
    This week it was announced that Flight Centre South Africa has been named the Best Medium Sized Company to work for in South Africa, voted by our staff in the Deloittes survey. We were also name the Best Company to Work for in the Travel and Tourism sector.
    We are proud of our work force and as a leadership team we remain committed to ensuring that Flight Centre South Africa remains the Best Company to work for in South Africa.

    Keep an eye out because South Africa will continue to grow from strength to strength.

    Ps: Even with our exchange rate, we are ready to go Global and dominate in Macau.

    Reply

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