United Kingdom
United States
Asia Pacific
Commission cuts the ‘most significant development for 15 years’
The raft of commission cuts sweeping the industry is the most significant development in the sector for the past 15 years, Libra Holidays sales director Paul Riches has said.
“In terms of the relationship between agents and operators and the future of travel agents, it has changed everything,” he told TravelMole. “It completely blows apart the traditional business model.
“It will put the cost-base of agents under even more pressure and if tour operators get it wrong, they too will be under pressure.”
The comments came as more operators began reviewing their commission terms and agreement with agents as the fall out continued from Thomson’s move last week.
Richies said Libra had no immediate plans to reduce commission but said there could be “tweaks” in the future.
“We have existing commercial terms with retailers and we have no intention of breaking those,” he said. “If our model works in today’s environment – which is very different from yesterday – than we will carry on as we are.”
Speculation was intensifying that MyTravel will follow the commission cuts of Thomson, Thomas Cook and First Choice. Observers said it was inconceivable that the operator will not head down the same path.
“As First Choice and Thomas Cook have already indicated, Thomson’s rivals simply cannot afford to seen as uncompetitively priced in what we all know is a price sensitive market,” said one source.
MyTravel, which is in a closed period, said it was “taking a step back” from the issue and declined to comment further.
Attention will now focus on the independent sector to see how they react to the cuts and whether they too will take a harder line.
However, observers said specialist operators are highly unlikely to follow suit, at least not to 7%.
“Unlike the mass market operators, independents need the distribution of the retail consortia,” said one.
Report by Steve Jones
Tony from Gatto’s Pizza on Columbus’s Unique Pizza Trail
Sophia Hyder Hock on Global Social Inclusion in Tourism
Sustainable Tourism: Don Welsh on Community Values and Global Collaboration
Jane Cunningham: Enhancing European Engagement in Tourism
Kristin Dunne: Navigating Destination Strategy
Revolutionizing Mobile Connectivity: Boris Bijlstra on HUBBY eSIM
Capturing Glasgow’s Vibrancy: An Interview with Susan Deighan, Chief Executive of Glasgow Life
Lebua Hotel & Resorts: Rajan Khurana on Hospitality and Bangkok’s Charms
Sustainable Tourism and Growth: Insights from Chiravadee Khunsub from Tourism Authority of Thailand
Revolutionizing Travel: SmartSIM USA’s Dale Takio Unveils the Power of E Sims
TravelMole Interview with Hishan Singhawansa, Deputy CEO of Cinnamon Hotels & Resorts, Sri Lanka
Unveiling the Essence of Magari Tours: A Dive into Authentic Italian Experiences
EU airports bring back 100ml liquid rule
British Airways passengers endure 11-hour 'flight to nowhere'
CLIA: Anti-cruise demos could cause itinerary changes in Europe
Co-pilot faints, easyJet flight issues ‘red alert’
Gatwick braces for strike