Commissions are your agent’s slice of the pie and main source of income, so it’s a big motivator for them to sell your tours. It can be tricky when setting commission rates to find the right balance between what motivates them and what keeps you earning a profit.

Here’s how you can determine your travel agent commission percentage.

1. Look to the industry standard for tourism products

What type of agent are you working with? There are 3 types of agents in the booking process: retail travel agents, tour wholesalers, and inbound tour operators.

According to SmallBusiness NSW, the industry rates are:

  • 10%-20% of retail price for retail agents;
  • 25%-30% of retail price for tour wholesalers;
  • 25%-30% of retail price for inbound tour operators.

If you’re unclear on the role of each of these agents, read this post first.

You don’t need to pay commission to each of these distributors separately – if you use an ITO and the commission is 30%, they will then pass 10% on to the wholesaler and 10% on to the retail agent.

2. Use this formula when setting commission rates

SmallBusiness WA have provided a great formula that you can use.

small business wa calculate setting commission

It’s important to note that some operators offer additional “over-ride” commission to encourage sales, which is generally 2-3% on top of existing commission rates.

3. Setting commission rates in your tour booking system

Ok, so now that you’re done setting commission rates, it’s time to implement them into your booking system. In Rezdy, you do this via your Catalog, which is created in the Inventory > Catalogs menu.

The Partners Catalog defines commission rates and the access and restrictions you give to this agent:

setting commission rates in your tour booking system

When you add an agent, Rezdy will ask you to select a Catalog. Once you have completed all the steps to add your agent, your agent will receive an email inviting them to use Rezdy to book with you and receive a commission percentage.

When they accept, they will have a clear view of what products and commission rates you have assigned to them.

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