Cadogan Holidays has reduced prices after agreeing with agents to cut commission by up to a third.
Managing director Tom Allen said agents agreed to the cuts, which has left them still earning commissions in the teens, providing the savings went into cutting prices.
He said the operator can now offer prices for 2007 between 5% and 10% less than this year.
He added: “We went to agents and said our prices are quite out of line with the market; many had complained to us that our prices were too high. Even after the commission cuts, we’re still one of the best payers in the market.”
Allen said further price cuts were possible following internal restructuring and the operator is now looking at new niche markets.
Already cruising in the Indian Ocean is under consideration although Allen would not say exactly when it could be introduced.