One thing I’ve noticed in a lot of responses to posts is that many travelers have no idea of exactly when and why travel agents charge service fees. It doesn’t help that there is no consistency in the industry.
Here’s a little background to perhaps make the fees more understandable and palatable.
Years ago, most travel agents worked for free from a consumer’s point of view. Airlines paid agents about 10 percent of the booking price to issue their tickets and, in exchange, they didn’t have to hire as many reservations staff. Plus agents could bring airlines additional business.
Then all that changed. Airlines, starting with Delta, first capped, and then basically eliminated commissions. Now, to be fair, some agents were “rebating” commissions back to their clients, which means they were undercutting the carriers, but overall it was a cost-cutting move.
Also, as the internet grew more popular, airlines figured they could easily sell tickets cheaper themselves. While travel agents could usually at least match online prices, they started charging fees.
Since the sites have limitations (to put it mildly) and because some people will pay for advice and the opportunity to sometimes save money, travel agents are not nearly as extinct as some people thought.
The fee structure, however, is confusing to many travelers. There isn’t a lot of consistency. Here’s a bit of background and general information based on my experience.
Some travel agents charge flat fees per ticket, others charge a percentage. The problem with the flat fee at times is that it can seem like a high percentage of the fare. On the other hand, many agents agree that some of the cheapest tickets can be the most work.
Charging percentages may give a prospective client the idea the agent will choose a higher priced ticket to make more money. (The defense against that is that any agent who works that way will lose clients.)
With international travel, some agents have contracts with specific airlines, or can work through consolidators where they get paid a form of commission for issuing a ticket. So, a travel agent may reduce or eliminate a fee in those circumstances. (Although for the most part there are no commissions on the very lowest fares.)
What happens with a ticket change? There isn’t consistency here. Some agents will charge a flat fee per trip (which includes any changes booked). Others will charge to reissue a ticket. (If it’s a problem with a canceled or delayed flight, that’s generally covered under the initial fee, even if it takes hours to fix. In fact, one of my favorite clients says he considers our fee “travel insurance.” )
With a change in advance, I can understand a traveler’s frustration with paying a second fee on top of an airline fee, especially when those fees start at $150 and up.
But the truth of it is, that changing tickets is generally a lot more work than issuing the ticket in the first place. No matter how high the airline fee, travel agents don’t get any of it; even when agents have commission contracts with the airlines involved. Even with the change fees of $400-$500 fees now charged on many international tickets.
Some agencies charge a planning or advice fee. This is not for issuing tickets, but for what the name implies. Again, it’s not consistent across the industry. Some agents charge a flat planning fee up front. Others charge a “plan to go” fee, which can be applied to the trip if clients actually travel.
While some clients question the “plan to go” fee, but more and more agents are charging it. The reason behind it is simple. While many if not most travelers are honorable, others consider that anything is fair in pursuit of the best price, so they will try to get as much information as possible out of a travel agent, and then contact the hotels involved to see if they can get a better non-commissionable rate direct. Or they will take the same flight itinerary an agent finds and book it direct without a service fee.
And “friends” can be the worst. One woman who remembered me from our children being in after school day care called me last year after “researching fares for weeks,” and told me the best price she had found. I beat it by $150 per person counting a $40 service fee. But when I sent her the itinerary she thanked me, then went to the US Air website, and found the same fare.
So she asked if I would reduce or eliminate the fee. I told her no, and that it was still a $600 savings from her fare. She said okay, but later left me a message saying, “I hate to do this, but that money will buy us a nice dinner in Europe. Suffice it to say I declined to give her free advice next time.
Travel agents have many such stories, which is why the “plan-to-go” fee is becoming more common, especially for new clients.
A planning fee also is almost a requirement for certain kinds of trips, particularly clients looking for individualized itineraries. Travelers who want to book small hotels and inns that may not pay any commission will have to pay this kind of fee. It may or may not seem worth paying a fee for an agent to book a tour, but if that agent figures out a day by day itinerary, with suggested sightseeing etc., then that’s time that doesn’t otherwise get rewarded.
Admittedly, not all agents know what they are doing, so this post isn’t saying that travelers should blindly pay for bad service. Note: If it’s a complicated trip with a significant fees, most agents who weren’t referred specifically should be able to either provide references or offer an initial meeting for free (if they are still taking new clients).
On the other hand, an initial consultation has limits.A “friend of a friend” called last year because his friend had “raved” about my knowledge of England. He had airline tickets already, but when I mentioned a fee, he asked if I could you just do a simple hotel reservation in London for a week or so for his family? While most London hotels will not allow four people in a room, I agreed to do this if he would book through me, which he agreed to do. So I sent him a long email with details on a number of properties that were family appropriate.
His response was to send me a proposed ten-day itinerary in a spreadsheet, asking for details on trains and/or buses for his day trips, asking which cities might be combined in a day, and also asking for sightseeing suggestions and restaurants in each city (including which attractions were open on which days, with hours, etc. to maximize his time). I told him I would have to charge something for that level of detailed planning, and he sent an annoyed email saying that he would just book one of the hotels I had recommended himself.
The short version of all this, the travel agents who were in this business for fun or as a hobby are MOSTLY gone. But the ones that remain, like other professionals, need to be paid somehow to stay in business.