Travel Agents protest with sweets and smile

July 14, 2008

rtr1sgpx.jpgTaking a cue from a popular 2006 Bollywood film, where the hero follows the path of non-violence to protest against injustice,  hundreds of travel agents in India sent sweets to airline offices on Monday to protest against a cut in their commission.

Come October, and most airlines in India will stop paying commissions to travel agents, citing rising operational costs.

This will effectively seal the fate of hundreds of agents who will have to close shop for good.

In India, travel agents get a five percent commission on basic fare from airlines and most of them do not charge passengers any extra money.

On Monday, about 1000 agents of the Travel Agents Federation of India (TAFI) dispatched boxes of sweets and flowers to offices of various airlines across the country.

An airline official admitted he was initially clueless to receive so many sweets for taking such a tough decision.

“We decided to follow the path of Mahatma Gandhi, as depicted in a Hindi film and tell the airlines that this is how we will protest everyday,” Anil Punjabi, chairman of TAFI says.

The film Punjabi is taking about is “Lage Raho Munnabhai” or “Carry on Munnabhai” which stars popular actor Sanjay Dutt.  He follows Gandhian values and the path of non-violence as preached by Mahatma Gandhi to protest when some aged people are thrown out of an old-age home.

The film won rave reviews and won four national awards, and people began emulating the Gandhian way briefly.

Now that it is back, I wonder whether this could be the new way of resolving corporate wars and disputes ?

15 comments

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Travel agents are the extended arm of the airlines. More than 85% of the airline inventory is sold through travel agents. We agents are also responsible for timely collection and reimbursement of money to airlines. By moving to remove agencies, the airlines will in effect cut their arms. Thousands of agents work round the clock to support the airlines. Today, the airlines neither have any infrastructure nor the work force to service customers. If the agencies were to close down, the customers will have a harrowing time. Secondly, world over, if any product is sold through an agent / intermediary, a fair remuneration is given by the principle. The airlines ought to respect this fact.

Thanks & regards

Posted by Rajesh K. Rateria | Report as abusive

India is still a service oriented (and service dependant) country in many respects especially travel. Airlines do not have the infrastructure in place to go to each customer direcly as the travel agent does. The web is a long way off from penetrating into the bulk of the Indian consumer base. The travel agent does the groundwork for the airline and thus has to be renumerated for the business it gets for them.

Technology is helping the aviation and hotel industry to make services easily accessible to the end user at sharper prices; in most cases agents play a role that adds no real value to the service;
It makes better sense in today’s context to offer incentives directly to passengers and generate loyalty, than go through agents who represent several competing airlines;

Posted by JAGDISH PAI | Report as abusive

I guess, it is indeed a good move from airlines. With online booking facility and etickets, agents are redundant. Agents still can charge service charges if passenger prefer to book through them. I only hope that airlies pass on the cost cut benefit to the users.

Posted by Nagesh | Report as abusive

Good move from airlines. All Brokers/Middle men/Agents should be abandoned in INDIA..

Posted by Ankur Kaushik | Report as abusive

Airlines should look into their passenger’s profile before they come with a major decision like this. May be their statistics might be correct but the reality check will prove 80% or over passengers in India is still service depended and Airlines can’t simply say that they do not want agents. It is like cutting the branch they are sitting. More than that by playing many different class in all most all English alphabets to give different pricing for normal economy tickets by the airline, how come a passenger can believe the airline is truly giving is five percent discount directly to the passenger! At least the travel agent shares the discount with passengers who pay at the time of booking.

It is a good decision . It has come aafter a long way.
Company as well as the passenger will benefit.

Posted by Kamlesh | Report as abusive

Hi
I these Guy’s Who want to do away with a travel agent have never ever flown before or have never had a a full service agent who offers all services like visas – cheap airfares , parts commission out of his income making travel more cheaper , the agent is available at every beck n call eg when you are stuck abroad with departed flight , sends you ticket when you dont have cash or or have surpased the credit limit on card .lost your bag any emergency like you pay him after you come back simply becoz you are out of cash .

All the best in case we become Extinct. Which i seriously doubt !

Posted by Sunil Bijlani | Report as abusive

first of all,you have to understand the roles of these easily accessible travel agents to know the impact of the decision.but on the other hand we can’t run away from the fact that the airline are facing financial crisis.so,an reduction in the commission rates can be a mutually beneficial solution.

Posted by hitesh | Report as abusive

My Friend ! I spent 26 Years in this Industry .i can site several ways how airlines are mis-managed and are responsible for their own losses Agents 5 % is a miniscule ammount .Are you aware corporate are paid incentives upto 15% and they are after our 5 % . Most of the airlines fly 35 % seats empty but are not ready to sell at reasonable prices, but want to extract maximum fare from pax . If Japan . Hongkong Australia can survive with 7-9 % commission why not India . Plus Anylize are you making those Billion $ losses ex India NO . american airlines have ridiculous prices wherby cost of travel from home to Airport is 80 $ but you can fly to a lot of destinations for 50 $ , you make losses in US and want to claim in India .

Posted by Sunil Bijlani | Report as abusive

Travel Agents are the backbone of the Aviation Industry. Stopping the payment of commission by the airlines is sure to the put the last nail on the airlines coffin.

Posted by Suresh Joshi | Report as abusive

Travel Agents are the backbone of the Aviation Industry. Stopping the payment of commission by the airlines is sure to put the last nail on the airlines coffin.

Posted by Suresh Joshi | Report as abusive

Air India one of the major Airline who had started this issue and later many Airlines followed Air India. I think Air India spending lot of money on their staff which is unneccissary. They should cut their expenses like they have appointed sales person for the travel agency and we all knows most of the sales person are useless. Airlines should think about of cut cost instead of 0% commission to travel agents. Travel agents gives 85% business to airlines and do really hard work. Airlines just gives 5% commission on basic fare most of the time travel agents passes this commission to the passenger. these days when the ticket is issued we can see taxes and fuel surcharge amount is more than the basic fare. I don’t know how the airlines will be benifited with this 5% reduce move.

Posted by ASHUTOSH | Report as abusive

I have witness the sea change in travel pattern in India in past 10 years.

First it is not ONLY 5% commission but airlines offers 30 days credit to agents (No body in above comments want to reveal) but THE End User has to settle account immediately except big clients/accounts. Mind it earlier big accounts were amounting 80% of air-travel now it is merely 30%. An individual travel has grown a lot.
This individual is well informed, tech savvy and has net access all the time from office and home via laptop, mobile etc. and uses credit card almost daily.

Coming back to credit from airlines when individual book the ticket he pays immediately but if he approach for cancellation agents always buy one month time.

I am fed up with these agents casualness with temporary recruited Front Desk eXecutives, frequently I have to tell them short mnemonics to retrieval/insertion of data to airlines database.

The move to cut commission and pass it to pax will increase the profitability of airlines; that are also responsible for their stock holders.

Posted by Rajiv | Report as abusive

Hats off to travel Agents India.Despite of obtaining such a low comission they did marvellous job because I my self realise whenever I pan for trip, I always use to hire travel agents and they always satisfies me with their good work.Really appreciable work.

Posted by Acrossocean | Report as abusive