The Telegraph
Since 1st March, 1999
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Travel agents fear cut in ticket sales earnings

Calcutta, May 18: Travel agents across the country are bracing up for a sharp reduction in earnings from ticket sales — the principal source of revenue for most.

Following a cut in commissions by domestic carriers last year, foreign airlines are planning to introduce a new system of paying travel agents a fixed fee for tickets sold.

This fee, travel agents fear, would be significantly lower than the commission they have been receiving from the foreign carriers. At present, travel agents receive around 5 per cent of the ticket value in commissions.

The practice of paying a commission has been phased out in the rest of the world, including the Asia-Pacific region, and replaced by a flat fee. But for the war in Iraq, foreign carriers would have already introduced the new system in India as well.

“They are now waiting for the SARS fear to subside. Once the industry emerges from the shadow of SARS, the new system is going to be introduced which could to lead a sharp fall in travel agents’ earnings,” say industry sources.

Another threat to travel agents’ revenues is airlines — particularly the ones from overseas — negotiating directly with corporate clients bypassing the intermediaries.

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