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Thomas Cook aims for 'sustainable profit growth' with online systems investment

Matthew Finnegan | Dec. 2, 2013
Troubled travel giant Thomas Cook has invested £17m in a bid to drive online sales to 50 percent of turnover.

Troubled travel giant Thomas Cook has invested £17m in a bid to drive online sales to 50 percent of turnover.

The move is designed to create "sustainable profitable growth" and facilitate "structural transformation" the company said in its full year financial results out today.

The IT infrastructure and ecommerce spend is part of an additional £25 million "strategic operational investment" aimed at supporting its multichannel sales growth, such as offering improved online functionality for customers.

Thomas Cook indicated that it is seeking to increase the proportion of its business conducted online from 36 percent currently, to over 50 percent by 2015.

Thomas Cook, which came close to collapse in 2011, is currently attempting to overhaul its business operations, recording a profit of £13 million for the first time in three years, compared to a £170 million operating loss last year.

The shift to internet sales will help reduce costs as part of its ongoing efficiency drive, the company said, claiming that "cost out benefits are expected to arise from the migration of customers to online channels with lower associated distribution costs".

Last year Thomas Cook awarded a multi-year contract to Anite for the supply of an online reservation system, intended to improve internet services for customers.

The company's Western Europe e-commerce platform is hosted by UK-based web hosting firm CatN, migrating its systems from Accenture in 2012 in a bid to better manage costs. Thomas Cook also has a ten-year contract in place with Accenture for infrastructure and business process outsourcing, signed in 2011.

 

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