Two of the UK’s largest travel consortia – The Travel Network Group and Advantage Travel Centres – have rejected the planned commission cuts put forward by some of the UK’s leading cruise lines.
The two groups – who have a combined network of over 1,500 agents have clubbed together to make a stand against the decision to cut third party commissions to 10%.
In a joint statement, Gary Lewis, group managing director of The Travel Network Group said: “We have now discussed this issue in great depth with our members and with Advantage Travel Centres and we are all deeply dissatisfied with moves by certain companies to reduce commission.
“Our strategy is, and has always been, to work with operators who help our members satisfy the needs of their customers, and who at the same time support the trade and our members commercially. There are a number of great quality Cruise lines providing fantastic cruise product to us as a Group and therefore, with immediate effect, we will be looking to strengthen our relationships with those cruise operators who are more supportive of our members and the trade. This will inevitably lead to a reduction of business going through those suppliers that are not supportive of this strategy.
“It is disappointing that during these already difficult trading conditions that some are choosing to make these commercial decisions that will ultimately harm the relationship they have with the trade and independent agents in particular,” he added.
The Travel Network and Advantage combined sell around £350 million worth of cruise through their network of agents.
Julia Lo Bue-Said, leisure director of Advantage Travel Centres said: “Agents margins are constantly being penalised. Seven years ago they earned the base commission on every component, seven years on non commissionables can account for at least 2% of the holiday price. This means that agents’ margins have continued to diminish whilst their costs have continued to increase.”
“Members of Advantage Travel Centres and The Travel Network Group are not supportive of the latest round of commission cuts and this will have a detrimental impact to sales. We have already witnessed the impact commission cutting has achieved and it does not drive incremental sales.”