It is a statement made often by clients “I thought you were paid a commission!”
Gone are the days where Travel Agents were paid commissions, by airlines to process air travel on their behalf.
In a white paper published by Amadeus , one of the reservation systems used by many airlines and travel agents, back in 2007, the demise of airline commissions had already fallen steadily from around 10% of the ticket price in the mid-1990s to zero in many markets.
The Amadeus survey found that thirty-four per cent of travel agencies said “reduced revenue from commissions was the number one challenge facing their business.” Fast forward 15 years since this survey, agents are now faced with zero commission from all airlines, the biggest competition being algorithms on various aggregator websites and popup travel booking tools. Not only do these sites offer rock bottom fares they offer almost to no back up support or infrastructure when things go wrong. Despite the effects on the industry due to the pandemic, and the need for an agents knowledge navigating travel documents, airport staff shortages and flight cancellations, 100% of airlines commissions are still set at 0% to agents.
With the majority of clients still believing these fees are paid to agencies, as well as competing with online booking tools it has become even harder to assist travellers and convert enquiries into reservations.
With overheads relating to licenses, reservations systems and keeping up with technology the experienced travel agent is becoming a difficult and sustainable profession, compounded by clients requesting quotations and then using the knowledge to book online.
Another misconception is that if you book a hotel direct, it will be cheaper, this is not the case, properties offer rack rates and will not discount the rates to travellers direct. High charges from aggregators like bookings.com, hotelbeds.com and airbnb.com means that these properties need to make up for lost revenue to recoup high charges paid to these sites.
The only way for the industry to keep the lights on and service travellers, is to charge a professional service fee.
So hat in-hand, I say support your travel agent, know that the knowledge required to navigate airfares, ticket issues, reservation systems, IATA Rules & Regulations take years of experience to build up and with a passion for travel and client service we keep fighting the good fight, for you the traveller.