travel agents perks

[pj woods]

Without mentioning which agency I received a email today saying that they will give double the onboard credit. I check prices of the cruise i would like to take and it is the same. So my question is how do they offer that kind of perk and if they offer it why can't royal offer the same.

[mollyeilis]

From how I understand it, they decrease their commission in order to offer it.

 

Royal doesn't do it because they don't want to, I suppose.

[waterbug123]

Perks offered by TA's will vary widely. Generally speaking, the pay for such perks out of the commission they get from Royal, i.e. for every perk the TA gives you, they keep less of their commission. Some TA's are willing to give up more money than others; hence, such offers vary.

[jamon]

Just curious if anyone has any idea what percent on average does a travel agency make on a cruise fare? Seems like if they can give double on board credit they must make in the hundreds if they are able to take a 100 dollar obc and make it 200..Something doesn't seem right..anyone????

[LovesCruising]

Just curious if anyone has any idea what percent on average does a travel agency make on a cruise fare? Seems like if they can give double on board credit they must make in the hundreds if they are able to take a 100 dollar obc and make it 200..Something doesn't seem right..anyone????

 

The percentage the ta receives depends on the amount of sales they have with the cruise line - ie: 13% 15% 18% etc. Every agency could receive a different commission depending on their sales leve. Taxes, port charges and Part of the fare is non commissionable as well.

 

Having said that - usually its the big on line agencies that can afford to give these kinds of perks because based on their volume they have a lot of sales.

 

Commission is based on the cost of the booking as well - so someone booking into a suite vs someone booking into an inside - suite commission obviously will be more

 

They are giving up a lot of commission unless we are talking about $100 out of their pocket - that they can afford to do - to give $300 out of their commission would be a stretch I would think

[MADflyer]

Travelmarket did a report on whether selling cruises still pays.

 

http://www.travelmarketreport.com/articles/Selling-Cruises-Does-It-Still-Pay

 

The comments following the article are very telling for the small agencies.

[LovesCruising]

Most small agencies don't receive what the large agencies do - especially the mom and pop type storefront - that's why they can't offer as many perks as the big on line agencies can.

 

Read the above article - very interesting

 

Found this especially so:

 

Let's say an agent has sold a four-night cruise on Royal Caribbean’s Enchantment of the Seas to a family of four with two children. The price for a large ocean view stateroom for a Bahamas cruise departing May 5 is $1,145.12 for the four cruisers.

 

Taxes, fees and port expenses account for $296.12 of the fare, according to Royal Caribbean's online booking engine. In other words, nearly 26% of the fare is non-commissionable.

 

This drops the commissionable fare to $849. Let's further assume an agent is making a 12% commission: He or she will earn $101.88 on the booking, barring any future re-pricing. This amounts to $25.47 per cruiser.

 

If he or she spent five hours on the sale from start to finish, walking the client through various cruise and vacation options, booking the Royal Caribbean cruise and printing out documentation, he or she will have earned $20.38 per hour.

 

So there is no way a small agency can kick back $100 obc from their commission on this type of booking - even $50 kick back would be painful

 

Can't necessarily agree with the $20.38 per hour remark - this may be the only booking for the agent in an 8 hour day.

Edited February 2, 2015 by LovesCruising

[Shekim]

Most small agencies don't receive what the large agencies do - especially the mom and pop type storefront - that's why they can't offer as many perks as the big on line agencies can.

but the smaller mom and pop type can offer service 24/7 if there is an emergency. Big online agencies usually don't

[LovesCruising]

Most small agencies don't receive what the large agencies do - especially the mom and pop type storefront - that's why they can't offer as many perks as the big on line agencies can.

 

Read the above article - very interesting

 

Found this especially so:

 

Let's say an agent has sold a four-night cruise on Royal Caribbean’s Enchantment of the Seas to a family of four with two children. The price for a large ocean view stateroom for a Bahamas cruise departing May 5 is $1,145.12 for the four cruisers.

 

Taxes, fees and port expenses account for $296.12 of the fare, according to Royal Caribbean's online booking engine. In other words, nearly 26% of the fare is non-commissionable.

 

This drops the commissionable fare to $849. Let's further assume an agent is making a 12% commission: He or she will earn $101.88 on the booking, barring any future re-pricing. This amounts to $25.47 per cruiser.

 

If he or she spent five hours on the sale from start to finish, walking the client through various cruise and vacation options, booking the Royal Caribbean cruise and printing out documentation, he or she will have earned $20.38 per hour.

 

So there is no way a small agency can kick back $100 obc from their commission on this type of booking - even $50 kick back would be painful

 

Can't necessarily agree with the $20.38 per hour remark - this may be the only booking for the agent in an 8 hour day.

 

And price drops will lower the agents commission even more

[LovesCruising]

Agree 100% about the small agency 24/7 service :)

[floatn]

In addition to taxes, fees, port expenses, there's also a line item for NCF, or non commissionable fare. So that 12% is on the BASE fare after all of those are deducted. Likely, the commission for that family of four is well under $100 after all is said and done.

[orville99]

Not sure what the norm is, but my TA gives us $25/$1000 of commissionable cost in OBC every time we book with them:)

[LovesCruising]

Not sure what the norm is, but my TA gives us $25/$1000 of commissionable cost in OBC every time we book with them:)

 

wonder what you are booking to get $1000 OBC please share

[jelayne]

but the smaller mom and pop type can offer service 24/7 if there is an emergency. Big online agencies usually don't

 

Previously used a mom & pop type - they weren't open on Sunday, only open till noon on Sat.

 

Now we use 2 big online agencies- one is open 12 hours Mon- Fri and 9.5 hrs Sat & Sunday. The other is open 6 days a week. We normally get OBC of 8-9% of the cruise fare excluding port fees & taxes. Latest booking was $8798. and we are getting $900.OBC.

[DragonOfTheSeas]

wonder what you are booking to get $1000 OBC please share

 

I think they were saying $25 for every $1000 they book. :o

[A2Mich]

wonder what you are booking to get $1000 OBC please share

 

 

They're not. They're getting $25 for every $1000 of commissionable fare that they spend.

 

 

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[toes_in_sand]

Please keep in mind that the travel agency may make 12-15 % commission off the base fare as a whole, but the selling agent, depending on their contract with the agency is only getting 30-40% of the total commission.

 

If the commission was $100, the agency head office/ owner keeps 60%, the agent will receive 40%. From that 40% they need to pay for marketing and website maintenance, advertising , etc which takes up about 6% of that 40%. At the end, the agent is only making 34% commission.

 

If you book on a online website, there is no agents to pay out, so the company keeps the total commission. This is how they make their money.

 

The cruise lines, at times are anti travel agent - Carnival for example received lots of backlash a few years back for trying to get the passengers to book directly through the cruise line, so the cruise line did not have to pay out commissions to agents. More money being kept in the the cruise lines deep pockets.

 

Please try to support the ma and pa agency. The agents live in your community, and the money they make goes back into the local economy. It keeps people employed.

Edited February 3, 2015 by Laurnat

[Shekim]

Please keep in mind that the travel agency may make 12-15 % commission off the base fare as a whole, but the selling agent, depending on their contract with the agency is only getting 30-40% of the total commission.

 

If the commission was $100, the agency head office/ owner keeps 60%, the agent will receive 40%. From that 40% they need to pay for marketing and website maintenance, advertising , etc which takes up about 6% of that 40%. At the end, the agent is only making 34% commission.

 

If you book on a online website, there is no agents to pay out, so the company keeps the total commission. This is how they make their money.

 

The cruise lines, at times are anti travel agent - Carnival for example received lots of backlash a few years back for trying to get the passengers to book directly through the cruise line, so the cruise line did not have to pay out commissions to agents. More money being kept in the the cruise lines deep pockets.

 

Please try to support the ma and pa agency. The agents live in your community, and the money they make goes back into the local economy. It keeps people employed.

It's generally the other way; the agent will keep 60-80% and the agency keeps the other %.

[A2Mich]

Part of the problem is the internet. The Internet makes it so easy to do so many things yourself. I think the days of travel agents are numbered, as they're not going to be able to stay in business with so many people booking nearly everything themselves.

 

 

Sent from my iPhone using Forums mobile app

[toes_in_sand]

It's generally the other way; the agent will keep 60-80% and the agency keeps the other %.

 

Unfortunately its not :-(

 

I left a well known agency specializing in cruises and our cut was 34% of the total commission. The agency I work for now, our agents get approx 30% on every booking. Their income is based on volume, we sell more all inclusive packages (same commission less work) then cruises.

 

It may be different in the USA and also depending on how the agency is set up. A company like TPI for example has higher commission rates, but the back office support is non existent. You need to work on your own client base, bring in your family and friends (the worst client) just to get an income going.

The company I work for now has an amazing lead generation and a strong online presence, so it makes selling for a new agent easier.

[LovesCruising]

Not sure what the norm is, but my TA gives us $25/$1000 of commissionable cost in OBC every time we book with them:)

 

I see

 

It's generally the other way; the agent will keep 60-80% and the agency keeps the other %.

 

not where I work nor the agents I know

[toes_in_sand]

Part of the problem is the internet. The Internet makes it so easy to do so many things yourself. I think the days of travel agents are numbered, as they're not going to be able to stay in business with so many people booking nearly everything themselves.

 

 

Sent from my iPhone using Forums mobile app

 

Not true at all. Just because you booked online does not mean that agents are not involved in the back end ensuring that your booking is correct and all the documents etc. all match up. You will be surprised how many online bookers do not know how to spell their name. No joke, happens daily.

If there is a schedule change/ cancellation/ flight number change who do you think is handling all of that? We call all our pax when there is a a sked change or any modification to their original flights.

 

Hotel relocations/ resort name changes/ hotel advisories/ agents are dealing with that as well. Not to mention hurricanes/ earthquakes/ terrorist attacks/ volcanic ash/ snowstorms/ weather delays/, Yes agents deal with that as well.

 

Your documents do not appear out of no where, Agents are ensuring all you docs match, names are correct and are matching your passport. your hotel is the correct hotel you booked and the room category is also correct. Agents are doing that as well.

 

There is also accounting/ marketing/ groups/social media/ tech support. And of course customer service who has to field every single complaint that comes their way.

 

Travel agents are still highly valued. Their experience and knowledge of the industry is something that can not be found on the internet. Yes, the internet does help when people are searching for a trip, but when it comes down to the booking process, many people still want to talk to someone that has experience. We have over 130 agents and every single one is busy right now.