President's Podium: Optimize your earnings

Welcome to September. The month that represents the end of summer, back to school, and most importantly the return of the busy selling season!

As you set your goals and begin to dig in for a successful fall and winter booking period lets take a moment to review the ways an agency can optimize their commission earnings.

First and foremost, know who your preferreds are. Understand what it is they can offer and do your best to become experts in their products. The most lucrative commissions and reliable support tend to be through your valued preferred partners. Your chains and consortia have worked hard on these agreements. Let them work in your favor.

Second, When searching through the booking engines make sure you take advantage of the sorting tools that are available. Keep in mind the best commission for the agent is not necessarily at the top of the search results. For example, when using Softvoyage to run your searches sort on "total price", you will find booking opportunities that may be much more rewarding on commission.

And finally, we have recently witnessed a large tour operator revamp their commission structure and the results are quite dramatic. Have a look at the following example that shows how this Tour Operator's move to all-in commission makes a huge difference in commission earned by the agent.

2 Adults, Base $983.47
2 Children, Base $563.47
Taxes on the 4 travellers, $354.05

Total Base= $3093.88

Previous 8% of Base = 247.51
New Commission = 354.04
Difference in commission 43%
Effective rate in the new method:  11.44%

With the above in mind, It would be wise to do your research, and not just look at the lowest price, sometimes as little as $20. It's really time for members to step up to the plate and reward the suppliers that change their approach, or else, it will turn back to a downward pressure on commissions again. 

Sincerely, 

David McCaig
President and COO
dmccaig@acta.ca