With the evolved state of the travel industry that has arisen in 2022, it should come as no surprise that the hit taken from the rising dollar exchange rate has had far less impact on sales than anticipated.
Since the peak of the pandemic, the travel industry has been working hard to evolve and become more resilient to fluctuations in trends, prices, global and medical climates, and more. Though the travel industry is beginning to feel the effect of the rise in the dollar exchange rate and the rising living costs in the UK, the travel trade has reported that sales remain resilient.
In the middle of May this year, the value of the pound in dollars fell to $1.21, and though it has risen to $1.25 in the past week, this change has caused a significant change in some travel costs that many expected to affect sales greatly.
It was reported that the change in the dollar exchange rate has caused higher prices in flights and resorts and some travellers are changing course for cheaper getaways in the Indian Ocean and the Far East. However, though it was reported that the flight prices are increasing, and the strength of the dollar could be “very damaging”, the demand for travel has remained strong and the increase in prices hasn’t put most travellers off.
The first signs of consumers switching to cheaper holidays have only just been recorded for some businesses in the industry, but the demand post-covid is still pent-up, with some businesses seeing some of the greatest sales they’ve ever had.
The US has been reported as losing some momentum in comparison with the rate of sales in 2019, but in volume, it is still one of the top destinations for UK travellers this season.
Avoiding The Impact of Dollar Exchange Rates Rising
Despite the incredible and surprising news that sales are not being drastically affected by the increase in the dollar exchange rate, big changes in currency exchange rates can have a huge impact on travel businesses that sell holidays abroad, and the constant fluctuation of exchange rates can be damaging to a business’s profits.
But the dollar exchange rate increasing doesn’t have to be devastating for your business, no matter the travel demand from consumers. The continuous fluctuation of exchange rates can cause a lot of hassle and trying to combat it can feel impossible, but that’s where currency hedging comes into play.
Currency hedging allows you to set a fixed exchange rate for currencies at the start of every year so you can set prices for your packages abroad without any concern that the exchange rate will take a dent out of your profit.
Plus, when you become a trusted member of Protected Trust Services (PTS), our expert team provide currency hedging with a trusted provider, UPFX, so that you know you’re working with people you can trust.
PTS also hosts multiple currency trust accounts in our system, so you can provide some of the best financial protection to your consumers in whichever currency you choose. Between the trust account and our FX provider, currency exchange rates won’t be time-consuming or devastating to your business, all you need to do is set a fixed rate at the beginning of each year, and you can continue making the holidays you love.
PTS strive to provide all the tools our members could possibly need, from reconciling daily so our trust account is always up to date and secure for you and your clients, to currency hedging, ATOL support, friendly merchant services, and more. When you become a member of PTS, we provide everything you need to be the best business you can be without limiting your independent business.
So, if you’d like to learn more about how your consumers’ monies are protected with Protected Trust Services (PTS) and how we support excellent travel businesses, check out our pages. Or you can get in touch with the lovely PTS team by calling 0207 190 9988 or emailing us at ask@protectedtrustservices.com.
