Missing, believed lost: US$20 million in commission
SINGAPORE – Travel agents in the Asia-Pacific region may be losing an estimated US$20 million of revenue every year through failing to chase unpaid commission from hotels.
Analysis by Net Trans, the world’s leading commission recovery operation, indicates that around 50 per cent of commission owed by hotels is never handed over to the agencies which have earned it.
Net Trans says most agencies fail to chase commission because it is time-consuming and sometimes the expense of banking commission cheques is prohibitive.
Net Trans, a global commission recovery service based in Norway, solves the problem by tracking and collecting commission on behalf of agents.
It says it keeps costs low through a mixture of automation and economies of scale. Founded in 1999, Net Trans processes commission for 15 million room nights each year on behalf of 9,000 agency locations in more than 80 countries.
Research by the company has revealed that most travel agencies in the region have no processes in place to chase unpaid commissions.
Net Trans, which is opening an Asia-Pacific office so it can help agencies to overcome this problem, said that even without having local representation, it has experienced strong growth in client numbers in the region over the past year.
“Our analysis shows Asia-Pacific agencies book around 2.5 million commissionable room nights through global distribution systems alone each year, generating $400 million of commissionable hotel bookings,†said Stuart Wines, Net Trans’ director of sales for Asia-Pacific.
“That figure should earn agents $40 million in commission but only 50 per cent of it is getting through. Recovering the money through Net Trans is an absolute no-lose choice for any agency.â€
Each month, Net Trans collects agents’ hotel bookings and commission receipts and makes a full reconciliation between the two sets of data. Missing payments are followed up with hotel suppliers on behalf of the agent.
All commission received is then forwarded to the client in a single monthly payment.
Net Trans has had an operations centre for back-office data processing in Manila since 2000.
Ian Jarrett
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