Backpacker tour operator Wicked Travel has entered liquidation owing a reported $1 million to employees, customers and other businesses.
On April 29 Lawrence Fitzgerald of William Buck Chartered Accountants was appointed liquidator of three companies: Wicked Travel Pty Ltd, Indie Travel Pty Ltd and Out of Bounds Backpackers Pty Ltd.
The companies operated travel and tour sales shops along Australia’s east coast. Customers have been left in the lurch by the collapse and will be unable to secure refunds after paying thousands of dollars up front for tour bookings, according to the ABC.
Meanwhile, one former employee told the ABC he is owed $10,000 in entitlements, while several employees on 457 visas have lost their jobs.
Wicked Travel sold off its assets, business name and systems to another company, Greyhound Australia, at the end of April, reports The Northern Star.
However, a “new” company, Greyhound Wicked Travel, says on its website it is “in no way a part of the now liquidated Wicked Travel”.
“Greyhound Australia are promising that all coach travel previously purchased via Wicked Travel will be honoured and welcome every one with passes or tickets, aboard their luxury coaches. While we are encouraging all tour operators to do the same for tours or packages purchased prior to the 29th April 2017 it is not guaranteed,” a note on the company’s website says.
Greyhound Wicked Travel lists eight shopfronts along the East Coast, from Melbourne to Byron Bay.
Liquidator Lawrence Fitzgerald told The Northern Star liabilities for Wicked Travel sit at $1 million, which includes money owing to the tax office and individuals that had booked travel vouchers, who are owed around $100,000.
Liquidators say they are still reviewing the books of the businesses and the sale of assets to the new company, although there’s little hope creditors will get their money back. According to the ABC, Wicked Travel has approximately $60,000 in cash and assets remaining.
Backpackers and tourists have raised concerns about Wicked Travel’s services through travel forums including Lonely Planet and Fodor’s since 2011 and 2012, including complaints about a lack of refunds, cancelled tours and sub-standard tour products.
“Having been in Australia twice now I can speak from experience, you are far better off booking your tours through a hostel or hotel, or going directly to the tour company involved,” one tourist said in a warning to others in 2013.
SmartCompany contacted Greyhound Wicked Travel and William Buck for comment but did not receive a response prior to publication.
Tour sector dominated by established players
Australia’s travel agency and tour services sector is worth an estimated $6.5 billion annually, according to recent IbISWorld estimates.
While inbound tour booking services for businesses within Australia are considered a “low volatility” business sector, the industry continues to be dominated by big players and travel agents. Hello World Limited holds a 13% market share, while Flight Centre holds 20%.
The remaining 66% of the market is split between a number of smaller players, but other tourism businesses are also taking a big bite out of the tour booking sector, including Expedia, Qantas and Booking.com, reports IBISWorld.
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