Fee Structures...to bundle or not to bundle...

Meet Mae Are you still running analog?

Summary of Findings – Agent Fees

Summary of Findings – Online Fees

Summary of Findings – Management

Summary of Findings – Implementation

Fee Models Client has a better understanding (apples to apples)? Specific pricing Pros Too easy to compare – commodity pricing? Additional services are provided free of charge where they could be charged? Cons Transaction Fee (most Account Management services included)

Fee Models Client has a better understanding (apples to apples)? Specific pricing Pros Too easy to compare – commodity pricing? Additional services could be viewed as overcharging when winning business Cons Transaction Fee / Management Fee – (Account Management additional)

Fee Models Simple – no nickel and diming Comprehensive model Pros Difficult to compare within the RFP? Sticker shock with one monthly bill? Cons Percentage of Sales (Most Account Management services included)

Quick Facts 3 possibly 4 of the responses charge extra for Account Management services. 1 agency charges a percentage of sales where Account Management services are inclusive All other agencies include Account Management services within the transaction fee. 9 out of 21 agencies charge for Car and Hotel only transactions Only 1 company charges for hotels when not in the GDS 2 agencies bundle 24/7 fees where others charge additional or are unclear in their response 2 agencies specifically charge extra for paper tickets and/or delivery 2 agencies specifically charge extra for refunds/exchanges On-line transaction fees range from $5-$20, while the percentage/sales model includes these. 9 out of 21 agencies charge for on-line implementation/setup, charges range from $200- $ agencies charge annual fees for on-line support/licenses 2 Companies charged for on-line shortfalls 1 company charges for Travel GPA reporting 6 agencies charge for vendor management/negotiating 5 charged extra for some type of reporting (most case included but charged for custom reports)

Things to Think About More of us are moving to unbundled menu-style pricing Questions to Ask: For those charging extra for Account management – how are you getting $20k/year? For tiered agencies: How do Account Management tiers affect service? Are clients willing to purchase the higher tiers? If a customer pays for one of the lower tiers, how does the agency handle denying requests for items included in the higher tiers? For agencies with multiple fees: How often do you field questions from travelers who are confused by multiple fee schedules? For all of us: ―Has anyone successfully collected the per hour project/consultation fee ―Who has a clear idea about the actual cost of Account Management? How do you determine your fee? ―Has anyone else attempted the Percentage of Sales model? ―Only 9 agencies charge for on-line implementation?

Open Discussion