29 July 2010

ATOC cuts agent commission

Agents booking rail travel have had their commissions cut by the Association of Train Operating Companies this week.

ATOC has cut commissions from 5% to 4% and is also forcing agents to take out bonding.

In March 2011, it is going to reduce commission even further to 3%.

Corporate online rail specialist RailGo said the move will hit its bottom line, but has pledged not to increase its customer transaction fees.

"ATOC’s decision to cut commission rates and enforce us to take out a bond will affect our bottom line quite considerably", said Nathan Cousins, business development director, RailGo.

"However we have resolved not to pass on any increase to our customers. By reviewing our own costs and negotiating various processing fees we have been able to hold our fees at the current rates for the rest of this year and throughout 2011."

RailGo charges corporate account holders a card handling fee, plus £2.00 per transaction if the ticket is issued online or sent by post, or £4.50 if the traveller collects their ticket at the station, as train companies charge agents for tickets on departure.

By Bev Fearis

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• Disintermediation
  
  

  Travel agents do a good job of representing consumer interests. By disintermediating agents the consumer is forced to go direct to airlines, carriers, tour operators. Once there the consumer can be treated to dumbed down and simplified service at lower cost to provider

  By Edwin Snood, Friday, July 30, 2010
• Shooting themselves in the foot
  
  

  This does not make sense. Don't the train operators want more business? They should be doubling commission, making rail an attractive product that agents want to sell!

  By Ken welsby, Thursday, July 29, 2010