Posts Tagged "Commissions"

Each year, it is my responsibility to solicit all four thousand plus of our hotels for each agency or third party we have relationships with, who have government lodging contracts. The rates must be at or below per diem, must be contracted January 1 through December 31 of program year, are preferably both commissionable and last room available. Also, the hotels offer their own non-contracted government rate that may or may not be at per diem. Although these are pretty simple requirements and standard for all participating properties, they do have challenges that corporatization may improve. First, per diems are issued in early August to be effective October of that year through September of the following year. Since we currently contract January to December, all...

Background: In the old days and before the 1978 Airlines Deregulation Act, the Civil Aeronautics Board (CAB) used to decide the fares between any two cities. They decided which airline flew from/to cities and how much they should charge. Well, the 1978Airline Deregulation Act changed the dynamics and working ways of the airline industry. It allowed airlines to decide where to fly and how much they can charge. Competition was the name of the game. What was the government reaction to the deregulation act? In 1980, the government using the sheer volume of business it controls was able to negotiate and establish “government fares or CITY PAIR PROGRAM”. “Fly America Act” requires the use of US flag carriers or US Code Share flights. These fares were to become...

For more than 20 years, travel agencies had a monopoly on two aspects of air travel: Information and Ticketing Now they have lost these monopolies due to deregulation; information is plentiful and tickets are more and more irrelevant. By cutting agents’ commission, airlines decrease their dependence on travel agencies as a distribution channel. The process started in the United States (U.S.) in 1995 when seven airlines, (American, Delta, US, Trans World, United, Northwest and Continental Airlines) joined forces to put a cap on commissions paid to travel agencies. They set an upper limit for travel agents’ commissions fixed at 50 USD for domestic flights, and at 100 USD in 1998 for international flights. In October 1999, airline commissions were reduced to 5%...

Travel agents are accredited by either ARC in North America or IATA in other parts of the world to sell airline tickets and other related travel services. ARC provides the airlines involved with services like accreditation of travel agents, uniform documents like air tickets, a computer system to report sales and remit the proceeds and finally a repository of information and data. On the other hand accredited Travel Agents have to follow ARC & Airlines rules in providing the services to the passengers. IATA by the way is the organization that established the 3 letter codes for airports that is used to identify to make bookings (PNRS) in GDS or facilitate bag connections. The FTR are accessible through the GDS. Those agents that wish to work with the Government...

Government travel management stems a long way back with initiatives lunched after the enactment of the “Airline Deregulation Act of 1978”. The main purpose of the act was to remove government control over fares, routes and market entry (of new airlines) from commercial aviation. The Civil Aeronautics Board’s (CAB) powers of regulation were to be phased out, eventually allowing passengers to be exposed to market forces in the airline industry. The act, however, did not remove or diminish the Federal Aviation Authority’s (FAA) regulatory powers over all aspects of airline safety. The stated goals of the act included: the maintenance of safety as the highest priority in air commerce; placing maximum reliance on competition in providing air...

Travel Management has grown with leaps and bounds.  It has grown from a struggling infant to a fully automated system capable of providing all your travel and travel payment needs. 1989 a survey conducted by American Express shows that corporate travel management is a career opportunity. 1993 the Clinton administration thought it could eliminate the entire White House travel office staff and replace it with a cousin of the president and the help of a midsized travel agency in Little Rock. Hal Rosenbluth of Rosenbluth International proclaims time is right for the automation of travel management. 2001, Sato began specializing in providing travel management services to government agencies. 2002 “The ETravel initiative was one of President Bush’s 24...