2011 Service Fee Report

The Service Fee report assists both corporate and leisure agencies in benchmarking their service fees. The report looks at trends in fees charged, how fees are collected, and how much revenue is related to service fees.

Additional Information

Changes in market forces have resulted in more agencies charging service fees compared to the early 2000’s. Many leisure agencies expanded their usage of service fees to offset revenue loss related to commission cuts. Corporate agencies already had a service fee-based model when the air commission cuts were enacted, however the loss of revenue from commissions did put more pressure on fee revenue.

The majority of all ASTA agencies (88%) charge service fees. The percentage of agencies charging service fees peaked in the mid-2000’s and then decreased gradually. The decrease reflects several factors including the movement of some leisure agencies away from selling air and the recent economic slowdown.

Fees for air bookings (96%), rail (61%) and trip planning (56%) are the most likely for an agency to have. Fee amounts have been increasing over time in all categories. Average fees for air bookings did decrease a small amount between 2008 and 2010 before recovering in 2011. Trip Planning has seen the strongest increase in average fee amount charged (+35%). Those agencies charging fees reported that an average of 19% of their revenue comes from service fees in 2010.

Potential cost cutting by travel suppliers means that the remaining commission revenue remains at risk. Agencies should review their revenue sources and make sure they are not overly dependent on any one source of income.

This 40-page report covers average service fees for air, cruise, tours, car, hotel, rail and other bookings. It also looks at fees for other services such as assisting with visa applications. Included in the report is revenue from service fees as a percent of total revenue and the percentage of agencies that also have consultation fees.