WEB web travel group limited

Good point made by a travel magazine in response to Webjet's...

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    Good point made by a travel magazine in response to Webjet's stated intention of making WebBeds the "number 1" wholesale bed provider in the world.

    WebBeds is currently claiming 350,000 hotels and 44,000 customers in its network. Based on past Webjet ASX announcements, between 30,000 to 40,000 of these properties are directly contracted with WebBeds. The remaining 300,000 plus would therefore be supplied by third-party providers, who own the hotel relationship and take a commission cut along the way.

    Meanwhile, HotelBeds, the world’s leading bed bank based in Spain, says it has 180,000 hotels – an estimated 75% or 135,000 of which are contracted, three times more than WebBeds – and 66,000 customers. HotelBeds also has a much bigger contracting team than WebBeds, giving it a key advantage. The importance of having a direct relationship cannot be overstated – higher commissions per transaction, greater flexibility in terms of partner pricing and distribution, better data and ownership of the client.

    So the question (put to Webjet without answer): On what metric are they aiming to be #1? Or was it just an feelgood thing to say to inspire confidence in the company?

    As WebBeds is the growth driver for WEB, it's a reasonable question to ask. Especially since we can forget about any growth coming from the OTA segment in the foreseeable future.
 
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