Commtrak Recovery Benchmarks

Estimating Recoverable Hotel Commissions

Unless your agency currently performs a comprehensive hotel commission reconciliation effort, it is extremely difficult to estimate potential hotel commission recovery based on gross hotel sales. Recovery is based on a number of agency variables. Factors which can serve to increase or diminish the potential recovery include:

• a high percentage of non-commercial, leisure business

• a high percentage of very large corporate accounts with net-rate programs

• average usage of major hotel chain properties versus independent products

• high percentage (over 10%) of hotel bookings not recorded in CRS or accounting systems

Generally, larger travel agencies tend to serve larger commercial accounts who often negotiate significant levels of non-commissionable hotel rates. As a result, larger agencies can expect a lower proportion of legitimately commissionable bookings than that experienced by smaller agencies. It is not unusual for the larger agencies to book 50% of their commercial hotel reservations at net, non-commissionable rates.

For agencies who do not currently reconcile and pursue unpaid hotel commissions the most accurate means of identifying hotel recovery potential is to start from your known hotel commsision revenue:

1. Determine your agency's Annual Hotel Commission income derived solely from hotel suppliers (include only individual hotel bookings, as opposed to groups and tour packages)
2. Multiply your Annual Hotel Commission income by 5%
3. The resulting number is a reasonable dollar estimate of your Recovery Potential

( AHC x .05= RP )