Trade's competitive edge blunted by outdated payment methods

RESEARCH has found that the travel industry has yet to fully embrace newer payment systems, which has made travel consultants, wholesalers and tour operators less competitive as a result.

The finding is part of a series of white papers commissioned by eNett International and MasterCard and undertaken by PhoCusWright under the theme The Future of Travel Payments.

The study reported that 40 per cent of respondents said they faced the problem of losing out on unpaid commissions, which many recover via settlement services at a cost of 10-15 per cent.

Agencies turning over US$1 million and US$5 million hire one part-time staff member to handle reconciliation, fraud, chargebacks and related functions, while the task requires an average of 16 full-time employees in a company with over US$1 billion in bookings.

It said that travel industry players needed to take a wider view of the costs involved including manual processing, reconciliation and reporting, foreign exchange, delayed cashflow, fraud and supplier default.

Such hidden costs saddle travel companies with unnecessary burdens “at a time when travel suppliers are already under relentless pressure to cut costs and increase margins”.

Anthony Hynes, managing director and CEO of eNett International, said: “The travel industry continues to face a tough climate. A business’s ability to deliver and succeed in this environment will be dictated by how well-placed it is to control costs, minimise risk, utilise its data and ultimately enhance revenue.

“Deploying innovative new technology can help deliver the changes needed in a simple and straightforward way, meaning consultants and tour operators can focus on doing what they do best – meeting and exceeding the expectations of your customer.”

The study represents the views of over 1,500 respondents from the travel industry internationally.

Full results and how travel consultants can tackle the problem of inefficient payment systems will be discussed in a webinar on May 7, which interested parties can sign up for at www.enett.com/insights.

Sourced: ttgasia