How Travel Agents Make Money From Hotel Bookings

The rise of the internet means that businesses have more choice than ever before when it comes to booking their travel, but an increased number of options means that it is harder than ever for companies to know if they are getting the very best deal.

This situation has led to many firms deciding to use the services of a travel management company (TMC), which often have the right connections with various hotels around the world, working to offer their customers the best value for money.

The level of commission that an agency earns on the booking of certain hotels is of
ten a great source of their income. Travel agencies sell rooms per night on behalf of the hotels in their business portfolio, while also providing a valuable service to their hospitality partners. Commission is then made through the use of manual invoicing, before the payment is then processed by the bank and placed into company accounts.

This approach to making money is not exactly foolproof as, due to the fact that commission payments are made individually and manually, they can often be inconsistent, a situation that can cause great stress and worry for a TMC, especially when the global financial crisis has left many businesses across a number of industries becoming less financially secure.

This situation is made all the more serious given the fact that payments from hotels have become more of a priority to many agencies, due to the fact that other areas, including airline and car rental commissions, have started to dwindle.