THE INDEPENDENT Travel Agents Alliance has fired a warning shot on the
trade’s biggest operators claiming it will boycott those which discount by over
5% to direct-sell customers.
The ITAA said evidence of operators breaking this “gentleman’s
agreement” would force it to urge its 1,500 agents in Worldchoice, Midconsort
Travel Group, the Travel Trust Association and Travelsavers to de-rack
operators responsible and put them on stop-sale.
It comes after Midconsort slammed the big four for jeopardising members’
commission by lowering online prices by 10% (Travel Weekly February 23).
Worldchoice chairman Colin
Heal said the ITAA wanted a level playing field for independent agents. “This
is not a threat – we are laying down some ground rules,” he said.
Direct-sell discounting is one of the
criteria being used to draw up a list of 100 suppliers for the ITAA and
ultimately ensure one level of commission to all its agents. The reaction is
directed mainly at the eight largest operators using tactical discounts,
sometimes of 10%, online and over the telephone.
Heal added: “If they discount on an uncompetitive basis many agents will
continue to suffer. If we do not take a strong line it could even put some out
of business.”
However, some operators called it “an empty threat” claiming the ITAA
has little power to control members’ sales. “I’d be interested to see if they
could switch an operator off,” said one.
Operators also argue they have invested large sums to develop Internet
technology, which bypasses distribution costs of agent commissions.
But others were sympathetic. “Anything above 10% makes agents lose money
on a booking,” admitted a major operator.
TUI head of sales Jeanne
Lally stressed all distribution channels were important. “The web is not the
new Teletext, it’s just another channel.”