Q: Our agencys GDS contract runs
out at the end of next month. Am I correct to assume that I have
waited so long that it is now too late to negotiate a favorable new
contract by obtaining competing offers from other vendors and
playing one off against another? Wont I
be forced to take what my current vendor is coming in to offer next
week? Am I out of time to get advice from colleagues and advisers
about what the best deals look like? In other words, by not
starting the contracting process earlier, havent I backed myself
into a corner?
The answer to all of your questions is, Hell, no. Never assume that
it is too late to negotiate a top-notch GDS deal. Never assume that
you need to act before your current contract runs out. You can
still take all the time you need.
In 22 years of
advising about GDS deals, I have never known a vendor to cut off a
travel agency at the end of its three or five-year
While the sales rep
may threaten a cutoff, the threat is just a high-pressure sales
tactic, and you would make a mistake by falling for it.
Even if your
present GDS contract does not provide for month-to-month
continuation after the end of the term, you can count on your
vendors cooperation in keeping your present arrangement in effect
for many more months, as long as your vendor has any hope of
getting a new contract eventually.
So remember that
when vendors remind you about how soon your contract is going to
end, they are reminding you about a business opportunity, not
threatening your business.
high-pressure sales tactic that I have heard about lately is this:
This offer expires at the end of this month, and after that we will
not be making any more offers until the major airlines have all
renewed their contracts with us.
Actually, just the
opposite has been true: GDS offers continue to improve because the
vendors want to tie you up to long-term contracts now more than
So just ignore the
supposed expiration date, even if it is written right on the cover
of the offer package.
time-related tactic is one used by incoming vendors when you are
leaning toward conversion: You need to sign today because I need to
order all the equipment, which takes at least six weeks to install,
and then well need to schedule training classes, which we will need
to finish before your high season (or before your current vendor
shuts you off).
The truth is that
what little equipment you need can be installed in a few days, if
you insist on it as a condition to signing the new contract. And
what little training is needed can be finished a few weeks after
When you get time
pressure from a GDS vendor, you can just turn the tables and tell
the vendor that you will not consider any offer with any deadline
associated with it. I guarantee that the sales reps will back
In fact, go
further. Give all vendors a deadline by which they must respond in
writing with their original as well as follow-up offers.
Make the GDS
vendors scramble for your business.
is a Washington-based attorney specializing in travel law. To
contact Pestronk directly, e-mail him at [email protected].