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Travel agencies say BA move to axe commissions was expected

C-Travel is coming out fighting but other large travel agencies in Bermuda said last week that British Airways? decision to eliminate commissions was not a surprise.

While not pleased with the decision to cut the commission structure from $30 per ticket to nothing, Meyer-Franklin Travel said it understands the rationale behind the move and that it is the responsibility of any competent corporate entity to position itself with the appropriate business model.

Adventure Travel agreed with Meyer?s assessment ? travel agencies performed a service function regardless of specific products or vendors. Both agencies said they will continue to sell British Airways (BA) tickets, though Adventure Travel said service fees will be increased and Meyer-Franklin said service fees may have to be revisited. C-Travel CEO Carl Paiva declared on Thursday that his agency will no longer sell BA tickets, but will send their customers on other routes to Europe.

Two years ago BA announced they were reducing their commission from a percentage system to $30 per ticket. Mr. Paiva said on Thursday that while some agencies simply increased their fees, others had to close, unable to stay in business without the additional commission.

When BA announced on Thursday that even that $30 will be taken away, Mr. Paiva said he was furious and told the airline he does not work for free.

Though BA declared this was the way the system works everywhere else in the world, Mr. Paiva said in countries such as Barbados travel agencies battled against the proposition ? and BA backed down.

However: ?Global trends indicate that the entire industry will eventually follow BA?s lead and most forward-thinking travel agencies have started to prepare for this occurrence by positioning themselves to offer service vs. a specific product or vendor,? Meyer-Franklin vice president of corporate development and travel Cheryl Hayward-Chew said on Friday.

?Clients need to be confident that they will receive the best travel options and pricing based on their needs, not by how much commission is earned.

?We have a responsibility to our clients both corporate and leisure that we are not prepared to abdicate and that is to provide the highest possible levels of service. If we have to revisit the service charges assessed on BA then we will, but Meyer-Franklin Travel will never tell a customer we won?t send you this product. This is, after all, a service industry, is it not??

Adventure Travel manager Judy Knight agreed the decision was a blow. ?But,? she added, ?it?s only $30 a ticket.?

Nevertheless, ?we can?t survive on love alone ... We are still dealing with BA but we will raise our service fees.

?We hope the good service we give will convince people to stay with us, even though we?ve raised the fees on the BA flights only.?

Mr. Paiva is planning to meet with Transport and Tourism Minister Ewart Brown in the near future. He said he was unsure how much money he would lose after the decision is enacted on June 1, 2005.

He said C-Travel specialised in premium leisure cruise business and they supported other airlines so he has enough business to stay in business, but other companies will be affected by the decision.