Agents can earn higher margins by acting as a tour operator with their own an ATOL licence, according to Holiday Travel director Steve Allerston.
In a recorded interview screened at the conference, Allerston said acting as a tour operator had allowed him to build margins of 15% to 20% into package holidays.
By selling a package, there is no need to reveal profits to the customer, he added. “The thing about having an ATOL is that you don’t have to break down the costs for the public.
“You don’t have to be as transparent with all the commissions to the same degree (as you do with a dynamic package) and that allows us to make a bigger margin.”
Allerston added acting as a tour operator gives him access to product unavailable to travel agents and helps him compete against other operators.
As well as obtaining an ATOL licence to work as a tour operator, Allerston said the East Yorkshire-based company was protected by mandatory tour operators’ insurance and optional supplier failure insurance.