Subhash Motwani enumerates the advantages of being a sub agent as he rules out the option of acquiring an IATA accreditation for his newly founded travel agency.

I have been in the training industry for almost 15 years now and on the event of our parent organisation RBCS completing 50 years, I always wanted to start a travel company and decided to take the plunge this year. I started preparing a check list as to how I should go about setting a travel company. I love travelling and I have seen several of my students who learnt the ABCs of travel under me become successful travel agents and continue to grow and do well. The focus was to be on promoting leisure travel which would include offbeat destinations.

Besides the bare essentials such as staff including sales team, computer, CRS connectivity, etc one thing that was missing from my check list was seeking an IATA accreditation and howsoever big an agency it may turn out to be, I had decided that I will not look for an IATA accreditation. This may be a surprise to many as I head an institute which is authorised to teach seven different IATA qualifications – the maximum number of IATA qualifications offered by any authorised training centre anywhere in the world. And when I see the team of people who work with me, getting the minimum two candidates who should be IATA qualified should not be a serious task as in my organisation I have as many as 30 IATA certifications of which I have completed 20 of them (meaning what? elaborate a little). This does not mean that I don’t recommend an IATA qualified person. In fact it is a qualification which will hold you in good stead to compete with other IATA agents.

The travel agent has undergone a major shift from the mere ticketing agent to more service oriented marketing and areas of niche marketing.

Last year I was in London, pursuing a British Airways certified instructor course and amongst the several participants many were with a travel agency background. They told me that in the UK, British Airways offers no commissions to travel agents at all. Until the time commission was the main source of revenue for a travel agent, IATA accreditation was a must. But today there are several sources of revenue for a travel agent and this includes a management fee, a concept which has not really caught up in India but is widely practiced in the western world.

A management fee is basically a charge billed to your client for your expertise on planning an itinerary to suit his time, budget and places he intends visiting. I am sure many non IATA agents too should start working on the principle of charging a management fee; the sooner the better.

The travel industry has changed phenomenally since the last three years or so – commission capping, “no-frills” airlines, Internet selling, etc. And it will not be the survival of the fittest but the survival of the specialist which I foresee will be the key to success for any travel company. You could specialise in leisure or business travel or cater to either of the clientele. However, in each of these segments there are various other sub-segments that one can specialise in such as a particular destination or a particular kind of travel package such as promoting shopping destinations, adventure destinations, religious destinations, etc. You could also specialise only in hotel booking or rail booking or fly-n-drive packages.

Today a large number of ticket sales are done online in most countries and before it catches up in India we should all gear up to alternative sources of revenue. Coming back to our main subject of why an IATA accreditation is not as important today, well here it is – all sub-agents will agree that the travel industry is not always a level playing field. Hence, if you are trying to book a passenger on X airline and if seats aren’t available on X airline, you will try to contact another agency who enjoys a better rapport with airline X or rather gets an incentive on selling airline X and are hence given preferential seat priority. No doubt the CRS has changed all this to a great extent, but even today during the peak season, some IATA agents rule the roost with certain selective carriers. As a sub-agent, you are at an advantage of dealing with whichever agent you feel like and IATA agents will continue encouraging sub-agents as it is an extra source of revenue that they get to meet their targets without spending extra on the sales and marketing effort and if you do give business you too will enjoy most benefits that an IATA accredited agent gets.

Let us look at the three key benefits that an IATA accredited agent enjoys over a sub-agent – credit facility, stock of tickets and commissions. As a sub-agent you enjoy almost the same commission as the IATA accredited agent keeps one per cent to two per cent margin and with that the responsibility of keeping the accounting transactions, filing sales reports with the airlines, etc. Stock of tickets too has to be kept with an element of extreme security and today if a person wants to buy a ticket on a short notice, in most cases with the changed scenario, he will directly contact the airline, do online booking or surf the net to go on a site where tickets are being auctioned. He/she may not necessarily contact the travel agent. And to enjoy the credit facility, I know of several sub-agents who have established a relationship with IATA accredited agents and have received credit but have always dealt in cash as far as the client is concerned and that is one of the huge advantages. Today’s passenger is better informed and most frequent flyers are aware that all IATA accredited travel agents avail of a credit facility from the airlines and thus expect the same payment facility to be extended to them. And if you are not an IATA accredited agent, you can use it to your advantage – remember the saying – the smart one is he who creates an opportunity of a problem, and you can encash your sub-agent title to demand for immediate cash settlement and avoid the risk of closing shop in the whirlpool of credit transactions.

Service is the key and if you give high quality service and do innovative marketing you should be able to do as much and in fact more business than the IATA agent. Ask any IATA agent and you will realise that more than 30 per cent of his time is spent in recovering monies or sorting out ADMs and trying to meet deadlines with BSPs, airlines, etc. As a sub-agent you have no such hassle and you can utilise this valuable time in sales, marketing and expanding your business to take it to a new high.

There are pros and cons to anything and that holds good also in becoming an IATA accredited agent and in today’s changing scenario it is much better to work as a sub-agent, expand your business. At any given time once you have got the volumes increasing, you will have the IATA accredited agent coming to you and wanting to do business with you to meet his targets with various airlines.

Before concluding it is important to remember that you should be knowledgeable, qualified and adaptable to frequent changes and that only can help you grow and be a successful travel agent. It is important to get the right kind of qualifications which covers areas of marketing, customer service and being extremely knowledgeable about the products and services that you are offering to your customers.

About the writer: Subhash Motwani is Director of IHCTM (Institute of Hotel, Cargo and Tourism Management) which is currently the only IATA/UFTAA authorised training centre in India to offer all the four levels of the IATA/UFTAA programme. Subhash has completed 20 IATA qualifications and was one of the 14 expert trainers who was invited by IATA in 1999 to Geneva for the Pilot Testing and development of the new IATA/UFTAA programme. Subhash also is Director of COMPACT TRAVELS PVT LTD. – an organisation which explores places like never before.