Complete Cruise Solution has announced a 1% cut in commission payments to travel agents on its 2009 programmes.
CCS – the trade arm for P&O Cruises, Cunard, Princess Cruises and Ocean Village – said the commission cut was instead of making certain parts of the fare, such as Government and port taxes, non-commissionable as other rival cruiselines have done.
Sales director Giles Hawke said the move followed a consultation of several months with key retailers on what their preferred option would be.
He said: “We looked at what our competitors were doing because of rising costs such as taxes and our inital thought was to do the same and make certain elements non-commissionable.
“But when we spoke to agent partners, the overwhelming response was they would prefer a base commission cut because having non-commissionable items causes back-office difficulties and it’s harder for staff to work out discounts.”
If the cruiselines had made items non-commissionable it would have represented slightly more than a 1% cut in agency payments, he added.
Hawke defended the decision despite the fact agents selling cruise often discount the majority of their commission to compete with rival retailers and could ultimately end up with less commission. He said it would be up to agents to ensure the drop did not impact on their own commissions by discounting less.
“Commissions will still average about 14% and there’s still a substantial amount of earning to be had relative to our competitors, who might have higher headline commissions but have sustantial elements of non-commissionables.
“Agents can choose what level to discount at. It’s not as if we are really dropping commissions as some operators and airlines have done in the past.”