Two years ago, no-one would have predicted independent agents linking themselves to the vertically integrated companies.
But since then, both of the major independent agent consortiums ARTACWorldchoice and Advantage Travel Centres franchisees have aligned themselves with the major operators.
In an increasingly polarised marketplace, where does this leave the rest of the independent agent and operator sector?
Cadogan Holidays has recognised its distribution is threatened with the march of the multiples. It is now looking to form a group of 15 like-minded specialists that will work with a targeted 700 non-aligned agents. The retailers would be offered higher commission in exchange for guaranteed racking while both parties would embark on a joint marketing campaign, in-store training and educationals.
Cadogan managing director Gary David said: “My business through the multiples is declining as they push in-house operators. It’s the same for many specialist operators.”
A series of seminars with retailers will be held if the proposals receive support.
Another established independent travel agent grouping, the Campaign for Real Travel Agents believes it is set to play a bigger role in the future following the consolidation in the industry.
CARTA was formed by the Association of Independent Tour Operators in 1995 as the AITO 100 Club. It saw many traditionally direct-sell operators test the waters by selling through a select band of independent agents which they believed understood their products.
CARTA chairman and managing director of Kirker Holidays Chris Kirker said: “Specialist operators are finding it difficult to get their product racked and will promote through CARTA. As far as Kirker Holidays is concerned, we have no wish to sell through the multiples anyway because they do not understand our product or the service we offer. CARTA agents do.”
AITO executive manager Julia Hendry stressed the directional selling drive by the major operators is forcing more operators to review their distribution.
“For many the high street is out of play,” said Hendry. “Operators are having to be selective and forge close relationships with independents who will happily sell their product. CARTA members fall into this category. Operators are also asked to pay prohibitive premium rates of commission by the multiples where the volume of sales does not warrant it.”
Some 350 travel agent branches and 56 AITO tour operators are now involved in the scheme – all of which pay a one off joining fee and an annual subscription. For that, operators can promote through CARTA agents while retailers receive posters, window stickers and badges. Even predominantly direct-sell operators distribute their product through CARTA agents, including France specialist VFB.
Managing director Mike Bruce-Mitford said:”They are independent retailers who show a genuine interest in our product and have the clientele to match. Multiples just would not have the product knowledge to sell our tailor-made itineraries.”
In a bid to raise the profile of CARTA national advertising in the form of a mini-directory is soon to begin while a guide is being distributed to 300,000 consumers.
“We also are staging our first overseas conference this year in Gibraltar,” added Kirker.
Predictably, membership of CARTA is dependent on remaining independent of the mainstream tour operating companies. It is therefore surprising that Kirker is to recommend to CARTA’s 14-strong panel that members who have signed for the Advantage franchise can remain in CARTA.
“Commission is not the driving force,” said Carolyn Lodge, managing director of Carolyn Lodge Travel in Surrey. “We have a loyal client base and I will never sell them anything that is not right for them, no matter how much the override is.”
She admitted she switch sells away from mainstream operators to sell AITO products. “I know I can trust them,” she said.