Political factors that could impact Thomas Cook plc include civil unrest, such as in Syria, which may result in diminished interest and profits from sales to that country. The introduction of terrorist attacks could also lead to decreased sales and disrupted flights for Thomas Cook. Additionally, health and safety regulations may require Thomas Cook to invest in further precautions, potentially leading to higher expenses. Government intervention, such as legislation on emissions from planes, could also impact the company. Finally, if taxation were to increase, Thomas Cook may receive less profit due to higher income tax.
The effects of an increase in Corporation tax may also impact Thomas Cook, potentially reducing their profit and available capital for business expansion. Inflationary factors, like the rising price of oil, may also have an economic impact on Thomas Cook. Despite the necessity of purchasing oil for their business operations, this expense could reduce the company’s capital and hinder growth opportunities. Additionally, the recession could significantly affect Thomas Cook, leading to job losses and fluctuations in income.
This could impact Thomas Cook as job losses may lead to reduced disposable income, causing people to prioritize necessities like bills rather than spending on holidays. Conversely, during a period of economic prosperity, Thomas Cook might see a surge in holiday sales and higher profits as consumers enjoy more disposable income. Social factors also come into play with the potential rise in demand for package holidays, which could greatly benefit Thomas Cook as a prominent provider in this market.
Evidently, Thomas Cook’s potential for higher profits and growth could be influenced by public attitudes on pollution, such as the formation of pressure groups. This could lead people to not want to be involved with activities that cause pollution, including the emissions produced from Thomas Cook’s planes. As a result, sales could decrease and less profit would be retained. Additionally, demographic changes could also impact Thomas Cook’s sales. For instance, if a country has a larger single status population, it may lower holiday sales as holidays are typically seen as a ‘couple’ or ‘family’ event. However, out of all the factors mentioned, the strongest and most impactful factor on Thomas Cook is the economic factor, specifically a recession. A recession has the potential to determine whether existing or new customers can even afford to purchase from Thomas Cook.
