SERVICE fees are fast
becoming the main
source of income for
travel agents, who need to be
confident in charging clients
what they’re worth.
Owner of ITC Travel Essence
SA, Shani Erasmus’s post
on a recent experience
regarding service fees
instigated a flood
of passionate
responses
from travel
agents on
Open Jaw.
Over a
period of
eight days,
Shani quoted
a client 22
options for seven
people from six to 14
nights to two international
destinations for the Easter
holidays. Despite her
efforts, which included
her willingness to cut her
commission by R22 000, the
client still booked online. He
then requested an invoice
(for her trouble) which he
refused to pay because he
was being “ripped off”.
Agents who commented
on Shani’s post agreed that
agents should charge service
fees, even for providing a
quote, just as any other
professional would.
A recent eTNW survey
on service fees supports
this sentiment: 93% of
respondents said they
charged service fees for
corporate clients and 92% for
leisure clients.
“If you understand and
can quantify the value you
can add to a traveller’s
life, whether it is leisure or
corporate, you should feel
comfortable in ensuring you
are earning an income for
your time, professionalism
and expertise,” says
Garth Wolff, ceo of
eTravel.
Fear of
losing a client
or doubt
regarding
appropriate
amounts have
seen many
consultants
undercharging.
According to
eTNW’s survey, 32%
of agents worry that their
service fee will either
be rejected by the
client or that
other agents
will undercut
them.
Travel
Counsellor,
Gail FarmerBezencon,
says: “I am
one of the
lowest chargers
in my ITC group! We
have a minimum charge,
and I seldom go over this. I
try daily to value myself and
what I offer, but am not very
successful.”
An agent who prefers to
remain anonymous told TNW
he charged a fee based on
the amount of work done.
Service fees make up more
than 80% of his income.
Garth James, owner of
Buchanan Execu Travel, says
he charges a “very fair”
fee, which depends on the
price of the product, to all
customers.
“I like to work along a
percentage but also add on
a little if I feel I did a lot or
felt I was being bugged,” he
adds.
Garth Wolff says eTravel
has a guideline on fees
for its ITCs and a breakeven
recommendation
that ensures they remain
profitable and “do not end
up working for nothing, as
ITCs’ first thought is that
customer service is usually
at the expense of their own
earnings”.
Gail says her ITC
group also offers
guidelines, but
that it would
be helpful
to know
what other
agencies
charge.
Bronwyn
Pienaar, owner
of Travessentials,
agrees. For now,
she has negotiated fees
depending on the volume
of business for some
corporates, while she has set
fees for leisure clients.
Results of the survey
showed that, for corporate
clients, 38% of respondents
charged per transaction, 32%
as a lump sum (comprising
taxes, fees and product),
and 30% said their service
fee was separate from the
product they sold. Whereas
for leisure clients, over 50%
said they showed their fees
as part of a lump sum.
Gail says in the past she
lost clients because of her
comparative fees when she
gave a breakdown of the
fares, taxes and fees, so
now she offers a lump sum
inclusive of her fee.
While Bronwyn opts not
to disclose her service fee
when quoting unless she is
specifically asked to do so,
she says she makes it clear
when the time comes to pay,
which most clients are happy
to do.
The anonymous agent
says some clients do moan
about the service fee, but
that generally fees are
“warmly welcomed” when
accompanied by exceptional
service. “Definitely be up
front with the airline nett
cost and your own cost; we
don’t need to hide things.
That makes people worried,”
he says.
Asata had been
conducting a study on what
a ‘fair service fee’ would
constitute, but has since
postponed the research as
it was currently deemed
unnecessary.
