Agent to Peers: Don’t Let Fear Keep You From Charging Fees

by Marilee Crocker

Trish Gastineau, CTC, remembers well the day in the mid-1990s when the agents at her former travel agency were told they had to start charging service fees. “We were just trembling. We were terrified,” recalls Gastineau, who today is owner of Simply Europe Travel, a Virtuoso agency in Montgomery, Ala.

Fast forward 20 years and fees are still a hot button topic, one that can inspire fear in the uninitiated. “Fees are really scary to a lot of people. We as an industry have a hang-up about service fees and professional fees,” says Gastineau, who is an occasional speaker on the topic.

Travel Market Report asked Gastineau to share her views and advice on fees.

Why should agents charge for their services?
Gastineau: First of all, if we are going to be professionals and not hobbyists we need to run our business as a business. This is not you trying to be greedy. This is about you trying to run a profitable business.

You will take yourself and your business so much more seriously if you’re charging a service fee. It’s going to help you pay more attention to your numbers.

I was astounded by the amount of profit it added to my bottom line. Having the positive cash flow helped me reinvest in my business. And it made paying the monthly bills easier.

Finally they need to be charging because they really are worth it.

How did you set your prices when you started charging fees?
Gastineau: I always had a commission number in my brain and said that if I made XYZ in commissions on a total package then that was a good sell for me. So that went into how long does it take me to do an FIT, and if they walked away [without booking] would I make that number I had in my head? I used that as part of my indicator of what I was going to charge.

What are your fees today?
Gastineau: For air tickets, I charge $150 for international and $75 for domestic. If I’m doing something else in conjunction, I give a little bit of a discount. For customized FITs, my planning fee starts at $250 per person for trips up to 14 days. For 14 to 21 days, I add an additional $250 total, not per person. I charge a $75 per person professional consulting fee to manage cruises and escorted tours.

What percentage of your revenues do fees bring in?
Gastineau: 26%.

How do you talk to first-time customers about fees?
Gastineau: Before I work with a client, I do a complimentary 30-minute consultation. Then, if I feel like it’s going to be a win-win for us to work together, I’ll say, ‘Let me tell you about the way I work.’ I tell them some of the things I’ll be doing for them. Then I say, ‘If you’d like to move forward, I will take a professional consulting fee of . . . ’ And then I give them the price.

The fee is based on what they’re looking for, and I adjust it as needed. If it’s something that’s not going to cause a lot of research or work, then maybe it’s on the lower end.

What about current clients? How should agents introduce fees to them?
Gastineau: Prepare them. Send a letter saying: ‘Starting this date we’re going to begin charging XYZ.’ Then tell them, ‘Because you’ve been such a great client, on your next trip we’re going to waive the fee.’

You can start putting the fee on your invoices now, and mark it ‘service fee waived’ to get them used to seeing it.

What does it take to be successful charging fees?
Gastineau: The people that are most successful implementing fees are the people that have a mindset shift about it. They value their time. They know they’re worth it.

They’re’ confident in what they bring to the table. And they’re okay if someone says, ‘No thank you, that’s not for me.’

You will lose some sales if you have a service fee. But that’s okay because that’s weeding out clients that are not your ideal clients.

How do you feel about plan-to-go fees?
Gastineau: I’m not a fan. People will tell clients, ‘We have a plan-to-go fee, and it’s $150 per person, but don’t worry because if you go, it goes toward the balance of your trip, but if you don’t go then it’s nonrefundable and we’re keeping it.’ That is not a fee. That is a deposit.

You’re going through all that emotional anguish to get the fee, but then you don’t get anything from it if they take the trip. So go that extra step and keep it. You deserve it.

  42
  2
Tip of the Day

I do think there are possibilities for traveler advisors to make money doing domestic trips. I charge a planning fee for my time and expertise, and then book commissionable hotels and activities that meet the client’s needs.

Terri Weeks

Daily Top List

Best Resorts in Montana

1. The Resort at Paws Up

2. Blue Damsel Lodge on Rock Creek

3. Triple Creek Ranch

4. The Ranch at Rock Creek

5. Rainbow Ranch Lodge

Source: The Crazy Tourist

TMR THIS WEEK
http://services.travelsavers.com/AMGService.svc/REST/GetImage?ImageID=46d9854c-8d33-e911-b4aa-782bcb66a2f2

Give a Heads-Up, Get a Leg-Up in Business

Harness your knowledge, share your tips, and leave your clients wondering what else you know that they don’t.

TMR Recommendations
Top Stories
What Should Travel Agents Post on Social Media?
What Should Travel Agents Post on Social Media?

One company has studied what engages travelers the most on social media platforms, and offers its advice.

Travel Agents Assess Department of Labor’s Current Review of Overtime Pay Rules
Travel Agents Assess Department of Labor’s Current Review of Overtime Pay Rules

Department moves to increase annual salary threshold where employers have to pay overtime to $35,300.

Comprehensive Operations Help Allianz Build Comprehensive Coverage
Comprehensive Operations Help Allianz Build Comprehensive Coverage

At its vast Richmond, Virginia campus, Allianz Global Assistance finds that owning and managing travel insurance operations end-to-end helps it to consistently deliver value to customers.

How Can Travel Advisors Handle the Boeing 737 MAX Problem?
How Can Travel Advisors Handle the Boeing 737 MAX Problem?

The situation serves as a useful, though tragic, vehicle for reminding advisors of their responsibilities related to the safety of aircraft.

How to Sprinkle the Oprah Genius into Your Marketing Plan
How to Sprinkle the Oprah Genius into Your Marketing Plan

From finding your purpose to leveraging trends and refining selling strategies, Oprah laid out a roadmap for successful marketing.

How the Best Group Travel Advisors Keep Calm and Stay Efficient
How the Best Group Travel Advisors Keep Calm and Stay Efficient

Think getting into group travel will better maximize your time and your profits? Tread carefully, because more people, all traveling at the same time, requires efficiencies to be successful.

News Briefs
TMR Report Cards & Outlooks