Net rates (article)

Susana Moleón Moya
Susana Moleón Moya
  • Updated

Net rates enable you to work with travel agents & other distributors in a different way to working with travel agent commission. Net rates are a fairly advanced concept. Start using travel agent commission first, then if commercial circumstances require it, then move to using net rates for some or all travel agents. 

Please, note some agents may require to receive net rates over API = Trip.com, for example.

Example

With travel agent commission, if you have a 100 USD tour and give 10% travel agent commission, the travel agent will pay a net balance of 90 USD.

With net rates, you will distribute the tour at 90 USD and the booking will come into TourCMS at 0% commission.

Differences

  • Net rates can be applied to date bands AND rate types (e.g. just adults) AND to specific trips (e.g. just afternoon tours). Travel agent commission is applied at the tour level and applies to all dates for that tour
  • To adjust an individual booking with net rates, you adjust the sale price in a booking to give a different price to a travel agent. With travel agent commission setup, you adjust the travel agent commission (on the marketing tab)
  • Travel agent commission MAY be taxable in your locality
  • Travel agent commission can be set to be per person (e.g. 5 USD per person). Net rates does not have this capability.

How net rates work with sale (retail) prices

Travel agent commission ALWAYS applies to the sale (retail) price for a tour.

Net rates CAN work either from the sale (retail) price (e.g. 20% off) OR you can hard set a net rate

We suggest net rates are a % off the sale (retail) price. For example if next wednedsay you have a large group booking and they cancel at the last minute. You now want to promote that date to drive demand. You would do this by creating a special offer on the sale (retail) price in tours departures. IF you have created net rates anchored off your sale prices then the net rate for next wednesday will also reduce. Distributors therefore will also be incentivised to promote that date

You would use fixed net rates for seasonal contracts that you have in place prior to using TourCMS

If your TourCMS account has a base currency that is NOT USD then you can also add net rates at fixed rates in USD. These will only be distributed USD sales channels. This enables fixed price net rate distribution to some of the larger US based travel websites.

Initial setup

1. Homepage -> Configuration -> System & setup -> Agent general settings - turn on net rates (By default they are off for new accounts and it is set to use travel agent commission instead)

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2. Users - set user permission for each user you want to be able to edit / create net rates

From Homepage -> Configuration -> Users, then click on  mceclip3.png "PERMISSIONS & MAIN SETUP" for the User that you wish to set up Net rates. Scroll down to Products & Services and tick the box "View & edit net rates".

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3. Configuration - > System & setup -> Net rates - Create several tiers depending on the type of net rates you have agreed with agents. You can create a Net rate tier per agent / a Net rate tier per percentage / Group agents as it fits your business requirements - Regular agents / Top level agents for example.

Tiers

Tiers enable you to group travel agents into different levels. You can have unlimited tiers however we suggest at least initially you keep the number of tears to a minimum (e.g. maximum 5)

e.g. You could have one tier for top-level travel websites and one for regular companies.

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4. Optional: Configuration - > System & setup -> Agent general settings - Set a default net rate tier (for new travel agents). That way each new agent connected would automatically be assigned a default net rate tier.

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Probably you want to choose between using travel agent commission or net rates. It is possible to run both.

 

5. Partners - > Marketplace agents -> Find the agent by name or agent ID

Click on Manager and then the wheel icon next to the envelope, scroll down and allocate a Net rate tier applicable for that agent.

 

Here is the section where you can assign the chosen tier to a travel agent. You can change this setting at any time. 

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If an agent has a specific deal, we suggest you set up their own tier.

Tour set up

Once you have turned on net rates and setup net rate tiers you will now see, a new section called Net rates on tour level. 

 

 

First, you will see a default (GREEN) net rate. This will be the % that you have setup when you created that net rate tier. i.e. if you created the net rate tier at 20%, the default net rate will be a 20% reduction

If you are happy with the default NO OTHER configuration is required.

However, if the net rate percentage is different on some tours, you can manually change it here making sure the correct net rate tier is chosen at the top.

 

 

Individual date bands can be added with new rules. These MAY overlap. This enables you to do a special net rate promotion for a certain month.

Within the NET RATES page you can create new rules for a specific date band:

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Please note that the default rule is always the lowest priority.

Applying the net rate to the booking

  1. Staff booking engine - net rates will be applied automatically if an agent is selected (at the start of the booking process) that is set to net rates

IF several net rate rules are applicable on a tour then date specific will take precedence over the default net rate.

Net rates apply to tour departures, options & tour freesale

Frequently asked questions

When we set up a new tier will the default percentage apply to all tours?
YES - but only after a few minutes (there has to be some recalculation behind the scenes)

If we modify a default from within a tour, it only applies to that tour?
YES

If we modify a default for an existing tier in configuration and setup (rather than in a tour) what happens - does it modify all defaults for all tours?
If the update tick is selected, all existing tours will update to the new default (overwriting any tour specific default settings that may have been configured). If the update tick is left unticked, the new default will only apply to newly created tours.