Journal: TWUKSection: Title: Issue Date: 18/09/00Author

Charging clients £25 per hour in service fees will sort out the time wasters from those who truly want to book a holiday. This is a necessary step – we need to move with the times in order to stay ahead of the game

Charging clients £25 per hour in service fees will sort out the time wasters from those who truly want to book a holiday. This is a necessary step – we need to move with the times in order to stay ahead of the game

Edwin Doran

Some in the industry were astounded at my plans to charge £25 an hour for the service I provide to clients.

Others thought it was a joke.But I am deadly serious. I have to be – I am a businessman.

My focus has always been on profit and not on commission. My concentration is added value. I have earned the right to make more money when I improve my customer’s holiday enjoyment.

British Airways’ timely strategic initiative is my opportunity to look at how we make our money. The less people pay you, the more time they waste. Price buyers are not really buying a holiday. They purchase an item totally decided by cost. Their priorities are wrong.

Travel agents’ earnings are decreasing. They will decline more rapidly when the majority of airlines follow BA’s lead. Carriers are following changes that took place in the computer industry distribution channel.

PCs became significantly cheaper when manufacturers reduced dealers’ commission rates from 45% to 5%. The dealers altered their business strategies to become valued added retailers. You pay a minimum 10% service charge in a restaurant. Accountants and solicitors base their earnings on fees. An accepted practice.

As I believed I wanted to be suitably remunerated for the excellent service I provide my clients, I set out to devise a reimbursement plan which reflected my costs and my service quality to my customer. The lowest salary I pay to a retail consultant is £16,000 with the opportunity to earn a minimum of £4,000 extra in monthly and annual bonuses. From this, it was not too difficult to justify £25 an hour.

When do we charge? Our travel staff can spot time wasters. The first few questions about a client’s holiday confirms your evaluation. We tell clients that we levy service charges to pay our costs.

Getting the message across? We did some research among our clients regarding service fees.

Most of them were very surprised when told the low level of commission we earn. Each one agreed that service fees were fair when a holiday was not booked or we did not receive a fair reward for our labour, eg airline bookings.

We have developed this further by researching whether our clients want to discuss their travel on an appointment basis. The responses are 100% in favour of this to a casual visit.

The future for retailers? The only alternative to service charges is going out of business. Change is never easy. However, it is amazing how quickly you get used to it.

“We tell clients that we levy service charges to pay our costs”