Monday, July 22, 2013 Burn-off Customers and Suppliers

We've previously posted about Australian accommodation booking website

In 2011, we exposed Check-in's offhand treatment of a Christchurch motel" in their darkest hour" after the devastation and emotion of the earthquakes.

More recently, we posted about Check-in being placed in voluntary liquidation leaving thousands of Aussie and Kiwi accommodation operators along with hapless customers that prepaid accommodation exposed.

Check-in has a track record of performing well in terms of web-traffic with a 2010 media report claiming that the website attracted 450,000 unique visitors a month. Although these are impressive stats, it would appear that this popularity alone wasn't enough to sustain a profitable business model.

A quick search around the interwebs, reveals a lot of unhappiness about the demise of Check-in with questions being asked about why the previous owners, Accommodation Clearing House Pty Ltd were permitted to continue trading long after payments to operators ceased? Another common question is why didn't Check-in place funds received from customers in trust?

Last month, Allied Consolidated Ltd, that is listed on the Australian Stock Exchange purchased the failed Check-in business for a knock-down price of $35,000.

The sale price was reported as including, Check-in's e-commerce platform, a 350,000 customer database, supplier lists, domain names, logos, business names and other intellectual property.

Unfortionately, Allied Consolidated has not taken on any liabilities or obligations of Check-in's previous operating entity - In other words, suppliers and customers of Check-in (under previous ownership) have little or no chance of recovering outstanding funds.

After purchase, the new owners were quick to contact accommodation suppliers (many of whom still had outstanding accounts due from the previous owner) to sure-up continued support of the OTA that resumed trading after a brief pause. The "relaunch" of Check-in took place with little obvious change to the previous business operation:
From: []
Subject: Relaunch

We are pleased to announce has been acquired by ASX listed Allied Consolidated Limited (ASX: ABQ); click here to view further details of the acquisition.

With a new experienced leadership team in place Check-in has re-opened and will soon be processing new reservations.

Please feel most welcome to allocate rates and availability for your Property through the Supplier Extranet or via your Channel Manager and update the Check-in Booking Channel as normal to resume sale of your room inventory. If rates and availability were loaded previously please be aware this will activate automatically and will be bookable on Check-in as of 17:00 AEST Tuesday the 18th of June 2013.

Amended terms and conditions are available via the Supplier Site; by selling through Check-in you expressly acknowledge and agree to these terms.

If you have any questions please feel most welcome to drop us a line on 1300 47 22 22 from within Australia or email:

We look forward to your continued support and a prosperous future.

Supplier Support

P 1300 47 22 22 (within Australia) | E | W

Level 1 | 74 Castlereagh Street | Sydney, 2000 | Australia
A fellow motelier sent us the following email from Check-in's new owners in reply to an outstanding account chaser:
From: []

Thank you for your email.

Allied Consolidated Limited (ASX Code - ABQ) have taken on the Check-in assets only; any queries relating to prior debt for completed stays would need to be referred to the Liquidator for Accommodation Clearing House Holzman Associates:

ABQ are focused on delivering revenue moving forward.

Please feel most welcome to contact us for any other queries you may have.

Kind Regards,

Supplier Support
P 1300 47 22 22 | E
Level 1| 74 Castlereagh St| Sydney, 2000 |Australia
So, if a company is willing to take-on the "goodwill" and business operation of the Check-in, what are the consequences if that established brand under previous ownership burnt-off suppliers and customers?

Will customers be aware (or really care) about the consequences of Check-in's business failure under previous ownership?

After sustaining losses, how many accommodation providers are game enough to risk providing inventory to Check-in under new ownership?

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