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TMCs suffer rail commission cut
Monday, 26 Feb, 2010
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A reduced commission structure agreed between the Guild of Travel Management Companies and the Association of Train Operating Companies will have another knock-on effect.
Independent online train ticket retailer Thetrainline.com is to further trim commission by passing on the cost of bonding to travel management companies.
Sales and distribution director Adrian Watts said: “One advantage of thetrainline.com business model is that our partner TMCs are already bonded under our umbrella agreement; however with this forthcoming commission restructure we will have to pass on the cost of bonding to them, effectively reducing their commission by a further 0.5%.
“However, I am pleased that all of our business customers will shortly benefit from a range of new product initiatives from thetrainline.com, which will help soften the blow.”
Commenting on the ATOC commission reduction, he said: “Whilst a reduction in commission for our own partner travel management companies and direct corporate business is disappointing, at least we now know our remuneration and can plan accordingly for the next three years.
“As a result of this agreement it’s inevitable that our corporate and government customers will be paying higher fees when booking rail travel to recover lost commission and cover bonding costs.”
News of the reduced commission structure came the day the GTMC announced an increased levels of rail business in the final quarter of 2009 (see separate TravelMole story).
by Phil Davies
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