For decades, agents’ costs have been covered by the commission built into the price of the ticket / hotel room etc.
Over the course of the last few years commissions have almost been entirely eliminated by the airlines as they have been competing with the Low Cost Airlines and aggressively cutting their cost of sale.
All agents now have to charge fees to cover their costs. Whilst this may have initially be a shock to the client, the fact is that the client is now paying for what they get, it is clearer to see the value added and in most cases average ticket prices have come down!
5 years ago an agent would have been earning over £300 in commission for booking a business class ticket to New York. Now a fee of £30 or £40 would typically be the case!
Whilst different agents charge different fees and compile them in many ways, some quite confusing, the reality is that all agents have a similar cost of sale and will therefore expect to earn a similar amount from each client.
One therefore needs to be sure about the total amount that is paid to a travel management company over any given period of time. The simpler the fee charging system the easier this is to determine. Be aware of complicated menus and ‘hidden’ charges. A low booking fee often means that there will be additional charges to change / ticket / issue, plus further fees for other travel related services, making it very difficult to determine the total cost of using that supplier.
At Millennium Corporate Travel we only charge for Air and Rail – one flat fee. Hotel and Car hire done in conjunction with Air and rail is free.
At the end of the day the cost of using the agent is minimal by comparison to the cost of travel itself. The savings generated by your agent should more than outweigh the cost of the fees being paid.
