Evaluating the effectiveness of your travel agency.
Every day businesspeople fly on scores of airplanes in thousands of seats at dozens of prices determined by hundreds of travel firms. The gap between how a corporate-travel agency could perform and how it does can be wide -- and costly. Here are eight questions to evaluate how your agency stacks up.
1. What is the agency's revenue? Agencies grossing less than $10 million a year don't wield enough clout to wheedle favorable treatment from airlines; agencies that bring in more than $60 million don't bother to. The willingness and ability of a middle-ground agency to forge special deals can save clients as much as 40% beyond everyday discounts.
2. What support do the agency's up-front people receive? Negotiating favorable seat prices is a constant-vigilance mission that requires backup staff, a non-revenue-producing expense many agencies are loath to assume. An acceptable ratio is one support person behind each selling agent.
3. Where's our free ticket? To interest agencies in out-of-the-mainstream flights that otherwise would be chronically underbooked, carriers tender rewards for booking them. Often the favor is complimentary tickets -- for the agency, not the flier. A responsible agency passes them along.
4. Is the agency biased toward certain carriers? Agencies can earn lucrative overrides (percentage points added to the standard 10% commission) by funneling business through only one or two airlines. A responsible agent should spread business among several carriers.
5. Does the agency have an automatic low-fare finder? If it doesn't, you aren't automatically being quoted the best available price. A diligent agency electronically scours the system for price breaks half a dozen times a day.
6. How does the agency's average discount compare with retail? Against list prices, every agency appears a discounting genius. The better measure is against Lowest Logical Business Fare -- the three-to seven-day advance-purchase price that even you could obtain.
7. How carefully does the agency monitor its individual sellers? Computer surveillance to prevent innocent overpricing is a minimum safeguard. An agency ought to employ a quality-control manager as well.
8. What quid pro quos can a business expect for volume purchasing? More than a million dollars' worth of air travel a year ought to bring you your own agent-in-residence; several hundred thousand dollars' worth should entitle you to a satellite ticket printer on the premises. -- Robert A. Mamis