Local travel agents say they will survive cuts from airlines
The past six months have not been the best of times for Cathy Arter, owner of Travel Trams, a local travel agency. The events of Sept. 11 all but halted her business and just as business was picking up again, last week most major U.S. airlines announced they will no longer give commissions to travel agents who sell tickets on their routes.
“The airlines have us at their mercy and they know it,” said Arter, who estimates 30 percent of her business is comprised of booking flights for local customers.
She noted the discontinuance of commissions by the airlines came as no shock. For the past five years, she said, the airlines have been steadily decreasing the amount they pay travel agents, from a 10 percent base fee of a ticket price to a cap of just $20 per ticket. When the latter cap took effect Arter said she was forced to begin charging people to book tickets.
“The airlines know we can’t operate without income. All they’re doing is passing the costs on to consumers,” she said, adding she seriously doubts airlines will cut their fares.
Ruth Sparkman, who owns Sparkman Travel with her husband, Edward, said it has always been her company’s position never to charge a fee to consumers, but that the recent announcement of the airlines is forcing her to look at all options to make up for lost income. “We’re currently in the process of trying to decide what to do,” she said.
The catalyst for the airlines’ decision to eliminate commissions, many travel agents and travel analysts believe, has been the rise of the Internet, which has allowed many airlines to reach and sell tickets, often at a discount, to consumers directly, thus cutting out travel agents.
Nevertheless, both Arter and Sparkman are not terribly worried about the effects of the Internet on their respective businesses. Most people, they explained, do not have the time or the inclination to spend hours upon hours online or on the phone trying to search for the best fare and would prefer it be done by a travel agent in a matter of minutes. Also, Sparkman said, travel agents can beat any price found online 95 percent of the time if they have advance notice.
Travel agents also offer a personal customer service the Internet and airlines do not. “Most people want someone they can talk to and the Internet won’t talk to you,” said Sparkman. “I don’t think there will ever be a time when people won’t want travel agents. We give a service the Internet and the airlines can’t give and that’s why I’ve been in business for 33 years.”