What future for travel agencies?

Last year, at the annual meeting of Buon Viaggio Network, I had listened to an interesting discussion on the prospects of travel agencies’ commissions. I had been particularly impressed by the words of Gerard Letailleur, director of French giant Selectour, who said: “Our network receives commissions about 4% higher than individual agents, and at any rate we will continue working on a commission basis; we are far too important – airlines cannot do without us,”. A few days ago I participated in a meeting with Michelle Desreux, Senior Vice President of Global Operations for Uniglobe Travel in Irvine, California, who illustrated the situation in the U.S.A., where a zero-commission system has been almost universally introduced, thereby contributing to a significant reduction in the number of travel agencies (from 25,000 to 17,500). Michelle Desreux is convinced of the inevitability of the zero commission in Italy as well, though at a later stage than in other European countries, and therefore invites his franchisees to develop value-added services which, together with fees applicable to customer services, will constitute the agencies’ future revenues. Michelle Desreux maintains that in the U.S.A. – after a period of disorientation – customers have willingly accepted paying for services rendered by agencies, and in many cases the development of additional services and the relevant fees have in fact improved profitability. It may all well be true, but we also hear from the U.S.A. that – on the topic of commissions – Congressman Foley from Florida has asked the antitrust authorities to investigate on the behaviour of airlines which – by abolishing the commission system – are pushing U.S.A. and Canadian travel agencies towards bankruptcy. Folley believes there is ground to suspect a concerted action on the part of the major national airlines, and criticises the fact that commissions are denied within the Country, but continue to be paid abroad. This game is certainly very far from being over, and the Internet will likely play a decisive role.