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Misleading with only half the story...
February 19, 2010 | 01:06 PM
Hotels have always paid more than 10% for a travel agency booking...additional fee's they pay are to the credit card companies (1.5 - 3%), gds & switch fee's (flat fee or variable, up to 5%), plus other costs to participate and market through these channels (i.e. American Express, AAA, AAA discounts, consortium, etc). Hotels also discount 20% - 30% to groups of 10 or more, as well as negotiate 'special rates' with corporations and tour wholesaler's that will agree to direct 100+ room nights in a given year. OTA's certainly direct this quantity to a hotel in a given year. Why shouldn't they get the same rates a hotel is already offering to somebody else?
If you check your math, hotels are NOT thin margin-ed business - and if they are the GM is doing something wrong.
Kenneth
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