March 25, 2022 | By Graeme Kemlo
With just over three months to go, travel agents in Australia are facing slashed commissions on international flights and the prospect of asking their clients to pay a fee for service.
Qantas announced in May 2021, that it would cut agent commissions from five per cent to one per cent from this July.
Already some shopfront agents are charging between $25 and $50 per ticket.
“On a $2,000 international economy face we were getting five per cent, which is $100 and probably worth it, but at one per cent commission it is $20….probably the taxi driver taking you to the airport is getting a better tip than that,” said one suburban agent who preferred not to be named, and is charging $50 a ticket.
micenet spoke to a Melbourne corporate agent who has been charging a fee for a number of years and he said this was acceptable to corporate and high yield leisure clients because they recognise the value in having an expert deal with airlines, hotels and ground transport. He believes the new model for his company will be both a service fee and a percentage of ticket value.
“What is not necessarily obvious to clients right now is how long it takes us to get a response from Qantas – where we used to hear back within 24 hours, it is now 72 hours. So just booking a simple flight can take 15-20 times as long,” he said.
A home-based travel agent micenet spoke to said the group she belonged to had not announced their strategy on fees for service. She said some agents who might work with SMEs on travel management as well as event management, might find it all too hard for little or no reward.
While Qantas said at the time they announced the commission cut last May that agents may enjoy other “broader revenue opportunities, particularly through technology”, this is believed to be a type of portal known as NCP which will not allow agents to work with multiple airlines, only Qantas. It impacts agents who have been using Sabre for many years as this is yet another commissionable element the airline has targeted.
And recently Qantas offered to waive change fees on frequent flyer tickets as long as the client dealt directly with the airline. Agents saw this as a slap in the face, given than many hotel groups are also effectively squeezing out agents by insisting the best price is only available for those who deal direct with the property.