or anybody who's counting, this week
will mark the sixth anniversary of Delta's decision to cap domestic
commissions at $50 per roundtrip. For the record, the move took
effect Feb. 10, 1995. It changed forever the way travel agents
regard the airlines, and the way airlines regard agents.
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At the time, ARC counted about 45,200 accredited agency
locations, including 33,100 retail locations and about 12,100 STP
ticket delivery locations.
Today, the ARC list includes nearly 38,900 locations. In round
numbers, that includes about 30,100 retail establishments and 8,800
ticket delivery sites.
In the six years since Delta invented the caps, the number of
retail locations has dropped a mere 10% -- a fact that might be of
some comfort to those who like to regard their glasses as half
However, a true assessment of the impact of the commission caps
and cuts has to look beyond the numbers. For one thing, today's
numbers were inflated by the 1999 conversion of SatoTravel from an
airline-owned sales outlet into an independent travel management
company with 1,400 U.S. locations.
And the numbers were deflated by the decisions of thousands of
travel professionals to stay in the business but to opt out of an
We were speaking with an agency owner the other day whose agency
started de-emphasizing airline sales on Feb. 10, 1995.
Service fees became a fact of life. The words "and cruises"
found their way into the company name.
The agency's air sales now account for about 15% of its total
volume, just enough to justify keeping the CRS. And the agency's
more profitable today.
That may have been an exceptional agency. We suspect that many
agents believe they are not better off than they were in 1994.
But maybe the real question is this: Are you better off than you
thought you were going to be?