How do travel agents make profit?
For the past few months, I've been checking online rates and comparing them to the rates of one travel agent.
Of course, there are some travel agents who charge much higher than when you'll just book the flights yourself, but there's this one case where they always seem to offer a slightly cheaper flight.
How is this possible? Do they have some kind of partnership with the airlines?
How do they make profit when they always offer cheaper flights?
Best Answer
Some travel agents have negotiated fares with airlines, which means that they get specific prices at which they sell the tickets, these prices can be much lower than the prices online. As for your questions as to how flight agents make profit - there are two common ways. Firstly the airline gives flight agents commission on the tickets you sell, which is usually very low (0.1%) if anything at all, however some airlines do give more (5%). These percentages are calculated on the base fare of the ticket, thus excluding the vat. The other way that flight agent make profit is they add an amount of money on to the negotiated fare from the airline, which is then the commission they make on the sale. Usually flight agents will check online to see what flight prices are and adjust their commission accordingly, so that they are not more expensive than online prices.
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