Agents concerned ‘needlessly complicated’ pricing rules will confuse customers

By Juliet Dennis and Ella Sagar

 

Travel agents fear new pricing rules set by the Competition and Markets Authority (CMA) will confuse customers and could penalise those in compliance if prices appear higher than those of non-compliant rivals.

They also say many operators have yet to make the required changes to systems ahead of the three-month deadline for implementation.

The CMA issued guidance in November on requirements that all unavoidable fees and taxes payable in destination be included in total prices, and sent letters to about 100 businesses warning they had three months to comply or risk enforcement action.

 

More: The CMA’s new pricing rules ‘likely to cause confusion and complaint’

 

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As Travel Weekly has previously reported, the rules require firms to show a ‘total price’, with the amount to ‘pay now’ and the amount to ‘pay at the property’, plus an explanatory note to show the exchange rate used to calculate destination charges.

Agents report that complying with the new rules is time-consuming and “needlessly complicated”, and said very few customers had raised a complaint about fees in destination.

Some agents warn the changed regulations risk creating false price differences between companies adhering to the rules by presenting higher ‘all-in prices’ and those which don’t, particularly while firms adjust to the change.

Others say they have invested in new tools and training and redesigned advertising, while many operators have yet to adjust their pricing. 

Agents have also highlighted concerns about using ready-made deals from operators, the difficulties of dynamic packaging using bed banks, and complications of fluctuating exchange rates and city fees yet to be confirmed for 2027 and 2028.

The Travel Network Group and Advantage Travel Partnership confirmed they were preparing members for compliance, but TTNG chief operating officer Stephanie Slark warned differing speeds of adoption across the trade “may lead to short-term differences in how prices appear”.

 

"The biggest challenge for the industry is consistency. Some businesses will move quickly and others more slowly," she stressed, but insisted: "We believe a level playing field will emerge as the CMA’s enforcement continues. Ultimately, transparent total pricing is the right direction for customers - and we want our members to be on the front foot."

 

Advantage Travel Partnership commercial director John Sullivan also noted: “Consistency across the market will be important, and our focus is on helping members adopt the guidance in a way that is compliant, transparent and commercially workable.”

Agents urged all operators to adjust prices on booking systems and on promotional offers, with Fred Olsen Travel retail director Paul Hardwick adding: “The biggest complexity is in including any local taxes and how regularly these are repriced, including any exchange rate changes, but we are looking to take a lead from our supplier partners."

Idle Travel director Tony Mann said “the majority” of operators were yet to include full pricing in offers, noting: “I’m hoping for a quick change where they all come in line. We need everyone to do it at the same time (so we) don’t look more expensive and we are all singing from the same hymn sheet.”

 

His agency has plans in place to be compliant by February 23, but he admitted it could mean "a lot more work" if operators were not compliant.

 

Sutton Travel managing director Andy Tomlinson agreed, noting the need for offers to show the full all-in price, the cost of taxes or resort fees, and the currency exchange rate.

 

He said: “If operators calculate this, it saves us having to look up what the tax is, get out the calculator and work out what it’s going to be in euros."

 

Deben Travel owner Lee Hunt said multi-centre quotes were particularly difficult, and that the agency’s current window cards allowed room for only one price.

He added: “[In the past] we’d only find out taxes when people booked; now, we have to do it on all enquiries. 

It is starting to become more arduous putting quotes together and finding all the taxes. There are still operators that don’t put these taxes in the price which makes it really difficult."

 

Michelle Shone, Buckley Travel director, added there was a risk of customers being put off by more expensive ’all-in’ pricing. "It could be an issue," she said.

 

She warned agents might also decide to put less offers online if they were having to price up additional resort taxes each time.

 

“To have to work out and add all the different taxes for hotels or destinations every time we put an offer up on social media could result in less offers going online because of the time it takes; something would have to give,” she said.

Blue Bay Travel personal travel consultant David Coulter said there was a risk of “a two-tier system”, as customers would be drawn to non-compliant prices, especially online, and said customers could be confused about the upfront cost to pay.

 

“Adding an extra layer of pricing makes it look like we are charging the customer more than we actually are,” he said. “It is confusing for the customer as they may think they owe the travel agent more money than they actually do [as fees are payable in destination].”

Simon Clark-Jones, chief executive of Your Travel Consultant, said agencies risked being “caught out” and flagged the challenge of using bed banks and flight consolidators which would not ordinarily calculate additional costs.

 

“The costs of getting this wrong will catch a lot of agencies out, especially the smaller more local agents, and the more inexperienced agents which is where training and support comes first to stay on the right side of the guidance,” he said.

Henbury Travel managing director Richard Slater said agents needed clearer examples from the CMA of how pricing should look and said he had highlighted the issue to his consumer media contacts.

Daniele Broccoli, managing director of trade-only operator Typically Holidays, said local fees payable in destination had “never been a problem” during his 40 years in travel, with the changes creating a “needless complication”, particularly for multi-centre trips.

 

“I don’t know why the CMA want to make it an issue when it is not a tax that is payable here,” he said.

 

Broccoli said his business was working to provide “a best guideline” of total prices, citing difficulties with fluctuating exchange rates and city taxes only being set a year in advance, meaning pricing including fees for 2027 and 2028 are “a proper estimate”.

 

“I think if you show there is a tax and give customers an idea of what they are going to pay, the CMA has got to be a bit flexible if companies are showing this,” he said. “We will be monitoring if the taxes go up or down, and the exchange rates, but nobody can be 100% accurate.”