How Much Commission Should Tour Operators Give Tour Agents for Bookings?
3 Steps to Being Export-Ready: A Guide for Tour Operators
distribution, export ready, tour operator, tourism business strategy, travel agentsOne word: distribution. Without an “export-ready” product, there’s no way international distributors will even consider reselling your tour or activity.
So how can tour operators export-readify their businesses? Destination NSW provides some excellent information on what’s involved.
1. Identify the gaps
First you have to assess where you are in relation to being export-ready. Are you:
- Established in the domestic market?
- Executing a successful domestic marketing strategy?
- Offering instant online booking confirmation (or at least a 24-hour turnaround time via email)?
- Aware of how your tour product fits into international markets?
- Well-versed on the needs of international markets compared with domestic markets?
- Familiar with the concept of commissions and nett rates?
- Offering commissionable rates to your trade partners (ITOs, OTAs, wholesalers, retail travel agents)?
- Using a quality assurance program to make sure that your tours are consistently delivered at a high standard?
If so, then you’re already there! If not, then keep reading.
2. Plan your approach
It all boils down to your approach when it comes to the following:
Product development
Do your research! Think about where most of your customers are from, look at local market updates for information on emerging inbound markets, and extensively research your potential distributors.
If your product does not satisfy the needs of the international market (pricing or product itself), then you will have to make necessary adjustments to make it more appealing.
Administration
Decide what booking system you’ll use, how you’ll train your staff to use it, and how you will pay your trade partners.
Booking management with your trade partners can turn into a disorganized nightmare if you don’t put in the right systems from the outset.
Marketing plan
Budget for new efforts – like sales calls, trade events & famils, staff training, conferences, and industry association memberships. Decide how international promotions will contribute to your mix of marketing channels.
3. Create collateral
To be export-ready, you need to have 3 pieces of collateral to hand over to trade partners:
Sales kit
How else do you expect your partners to sell for you? This will be used to train their staff, so make sure it looks professional and is very informative.
Include:
- Fact sheets (per product)
- Fact sheets (per type of customer – group travel, conference products, and leisure free independent travel should be separated)
- Brochure
- Map
- Photographs
- Videos
You will want to provide these as hard copies for the meeting and soft copies after the meeting.
Rate sheet
They’ll definitely want to see this, because it tells them how much you’re willing to pay them for their services.
Remember to
- Offer industry-standard commission (up to 30%).
- Include age groups for child and concession rates.
- Include minimum and maximum numbers for group rates.
- Include seasonal rates at different times of the year.
You’ll need separate rate sheets for each type of agent, with nett rates.
Terms of trade
Put a lot of thought into this one, because it tells your distributor how you are prepared to work with them. You need to clearly define both of your roles – who’s responsible for what, and when.
Include your:
- Cancellation policy
- Blackout dates
- Payment terms
- Booking deadlines
- Payment details
We strongly recommend that you seek legal counsel before this is finalised.
If you would like help in automating the admin work that’s involved with your distributors, feel free to contact our sales team. Rezdy’s online booking software can manage your agent bookings for you.
You can also download our free ebook to keep learning about distributing your tourism products:
One word: distribution. Without an “export-ready” product, there’s no way international distributors will even consider reselling your tour or activity.
So how can tour operators export-readify their businesses? Destination NSW provides some excellent information on what’s involved.
1. Identify the gaps
First you have to assess where you are in relation to being export-ready. Are you:
- Established in the domestic market?
- Executing a successful domestic marketing strategy?
- Offering instant online booking confirmation (or at least a 24-hour turnaround time via email)?
- Aware of how your tour product fits into international markets?
- Well-versed on the needs of international markets compared with domestic markets?
- Familiar with the concept of commissions and nett rates?
- Offering commissionable rates to your trade partners (ITOs, OTAs, wholesalers, retail travel agents)?
- Using a quality assurance program to make sure that your tours are consistently delivered at a high standard?
If so, then you’re already there! If not, then keep reading.
2. Plan your approach
It all boils down to your approach when it comes to the following:
Product development
Do your research! Think about where most of your customers are from, look at local market updates for information on emerging inbound markets, and extensively research your potential distributors.
If your product does not satisfy the needs of the international market (pricing or product itself), then you will have to make necessary adjustments to make it more appealing.
Administration
Decide what booking system you’ll use, how you’ll train your staff to use it, and how you will pay your trade partners.
Booking management with your trade partners can turn into a disorganized nightmare if you don’t put in the right systems from the outset.
Marketing plan
Budget for new efforts – like sales calls, trade events & famils, staff training, conferences, and industry association memberships. Decide how international promotions will contribute to your mix of marketing channels.
3. Create collateral
To be export-ready, you need to have 3 pieces of collateral to hand over to trade partners:
Sales kit
How else do you expect your partners to sell for you? This will be used to train their staff, so make sure it looks professional and is very informative.
Include:
- Fact sheets (per product)
- Fact sheets (per type of customer – group travel, conference products, and leisure free independent travel should be separated)
- Brochure
- Map
- Photographs
- Videos
You will want to provide these as hard copies for the meeting and soft copies after the meeting.
Rate sheet
They’ll definitely want to see this, because it tells them how much you’re willing to pay them for their services.
Remember to
- Offer industry-standard commission (up to 30%).
- Include age groups for child and concession rates.
- Include minimum and maximum numbers for group rates.
- Include seasonal rates at different times of the year.
You’ll need separate rate sheets for each type of agent, with nett rates.
Terms of trade
Put a lot of thought into this one, because it tells your distributor how you are prepared to work with them. You need to clearly define both of your roles – who’s responsible for what, and when.
Include your:
- Cancellation policy
- Blackout dates
- Payment terms
- Booking deadlines
- Payment details
We strongly recommend that you seek legal counsel before this is finalised.
If you would like help in automating the admin work that’s involved with your distributors, feel free to contact our sales team. Rezdy’s online booking software can manage your agent bookings for you.
You can also download our free ebook to keep learning about distributing your tourism products: