Air Consolidators Thriving in Canada

Airline consolidators are something airlines don’t like to talk about, but all signs suggest that in Canada consolidators remain a vital distribution channel for the airlines – and a valuable supplier partner for travel agents.

One indicator is the number of Canadian airline consolidators that enjoy healthy sales volumes.

In addition to the handful of consolidators that have operated in Canada for years, in the past decade Canada has seen a proliferation of new consolidators, and there are now dozens in the field. Some are small and specialize in specific ethnic markets, while others sell to all destinations, with or without land products.

Cost effective
Not surprisingly, the airlines won’t divulge the extent to which they rely on the consolidator channel, but consolidators say the nature of the Canadian market makes their distribution role pivotal for the airlines.

“Canada is a large country geographically, with big distribution differences, so the cost is too high for airlines to service all regions cost-effectively,” said Craig Kijek, senior vice president, independent travel, for Travelbrands, the parent company of Intair & Network, two of Canada’s well-known consolidators.  

“Unlike the U.S., where consolidators are mostly serving ethnic markets, in Canada, consolidators are in all markets,” Kijek said.
 
Bruce Slade, business development manager at airline consolidator Huntington Travel in Mississauga, Ontario, said that consolidators “become the airlines’ sales force, call center and customer service departments.”

Advantages for agents
For their part, Canadian agents like working with consolidators for two key reasons – better fares for their clients and better compensation for themselves.

Slade explained that smart agents know how to find the best price through consolidators, often better than anything available on the web, so agents can make some money on air sales by marking up consolidator fares to the market price.

Slade also pointed to the level of service consolidators provide. He said that working with consolidators give agents a recourse when problems arise, “whereas when they are dealing direct with the airline, finding personal service quickly can be difficult.”

One aspect of selling consolidator tickets that agents and their clients need to be aware of is the fact that consolidator fares typically have more stringent restrictions than tickets purchased through the airlines.

Long-term partners
Travel agents tend to be loyal to the consolidators they deal with.

Jennifer Perry of The Travel Agent Next Door in Thunder Bay, Ontario, said she has been using the same consolidator, Network, for 19 years. “I use them a lot. I prefer consolidator fares for trans-border and transatlantic [travel]. I get a better fare than I can get online, and I have control over my commission.”

Mary Mlinaric of Connection Key Travel in Stoney Creek, Ontario, said her agency also works with consolidators a lot.

“We use Huntington for Europe. They have some great contracts, and we are able to match the airline fares and add a markup, so we don’t have to service fee the client,” she said.

“We get great service and good prices, so we’re happy and the client is happy.”

Forces in play
One reason some Canadian agents turn to consolidators for air ticketing is because they have dropped their IATA appointments. “In the old days, every agency was IATA – not so anymore. So those agents use consolidators,” Slade said.

Kijek said he has seen a change in the type of agents who use consolidators. “Some of the larger agency groups go after their own deals with airlines, while the midsize and smaller agents have gravitated to consolidators.”

Today’s complex technology landscape also prompts agents to use consolidators, Kijeck said.

“There’s not just one GDS or portal where an agent can see all fares. An agent wants to go to one place and find the best price and best option for their customers and that’s what we provide.”

In terms of which air travel routes are dominant for Canada’s consolidators, Europe is tops for both Huntington and Intair & Network. But consolidators also do a healthy business to other destinations around the globe, including the U.S., Asia, Africa and the South Pacific.

Both Kijek and Slade are confident that consolidators are here to stay. “The ones who have invested in technology will be here; the airlines need us,” said Slade.