5 HOT STORIES NEWS YOU NEED TO KNOW THIS WEEK


This week’s top stories: 1. Cook cuts commission 2. Royal boosts sales team 3. PTD tipped for delay 4. Hays sales surge 29% 5. Cosmos website woes


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Thomas Cook cuts commission by up to 2% for indie agents Juliet Dennis


Thomas Cook is believed to be paying 1% to 2% less in commission to third- party agents in a move described by some as “misguided and shortsighted”. The operator would not disclose commission levels but said agents that drive volumes would be rewarded. Industry sources suggested commission has been reduced on average by between 1% and 2%, which one claimed would encourage agents to book with Cook’s rivals. A Cook spokesman confirmed the new


terms represented an “overall reduction” after a period of significant change at the operator, with non-core brands taken out of the business. Individual performance-related deals


are currently being struck with consortia and agency groups and are due to be completed by May 1. Stefanie Berk, product and yield


director at Thomas Cook UK and Ireland, said: “We recognise the importance of third-party distribution, which forms part of our plans for the foreseeable future. “However, we have made significant


4 • travelweekly.co.uk — 23 April 2015


changes to our business in recent times, such as the realignment of our principal brands and introduction of a new city breaks programme.


“In line with this, the time is now right to adjust commission rates for third-party agents and place a new emphasis on driving up retail partners’ performance and rewarding them for volume.” But one of the UK’s largest agency


groups criticised the cuts as a way to slash costs, adding: “They are saying this is to do with risk and performance but it is not: they want to drop commissions.” Attempts by the vertically integrated


operators to reduce commission have seen limited success in recent years. Tui famously reduced commission to


7% for low-volume partners at Abta’s Travel Convention in 2005, but over the years the level returned to more than 10% for most third-party agents. Cook has boosted its popularity in


recent years with third-party agents by adopting a price-parity policy, which means it does not undercut retailers on its own website, unlike rival Tui Travel. ❯ Cook launches City Escapes, page 8 ❯ Letters, page 38


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