The 3 Problems

Travel is an opaque and classically conflicted supply chain. It needs the audit torch shone onto the right places.

Travel is an opaque and classically conflicted supply chain. It needs the audit torch shone onto the right places.

 

It all started when…

One … Airfare Mark-ups

TMCs all use “mid-office systems” to create their quotes and manage their bookings. The problem is that these travel agency systems enable manual inputs in the quotation building process. That is, airfares can be marked up from the amount provided by the airline. A mark-up to an international fare of several hundred dollars would far outweigh all other cost factors combined.

Until now, fare mark-ups have been under-discussed because they are practically undetectable. That is because you need the settlement data that shows the price paid by the TMC to the airline. Our proprietary HotDamn software decodes this data and makes it available as the irrefutable data-of-truth. Our sophisticated Airocheck audit process then checks for mark-ups across large data sets.

Two … Non-Availability

There is little point in using the size of your travel spend to negotiate discounted airfares and hotel rates if those discounts are then too often unavailable. You have wasted your leverage. There are several causes of unavailability of negotiated fares and rates. Only one of them is actual unavoidable unavailability with the airline or hotel. The other causes should be checked for and addressed.

Are your travellers booking non-preferred suppliers? Are your hotels and airlines over-restricting through aggressive yield management? Might the TMC prioritise a different fare or rate that carries a commission? Might the booking system or process be set to prefer other suppliers to maximise commissions? Our Dealcheck audit tests your data for percentage availability by discounted fare and rate. We then analyse for causes so that they may be addressed.

Three … Fee Confusion

To mitigate their revenue risks, TMC have understandably unbundled their service fees into many fee types. A typical TMC deal can now have twenty or more fee types. The problem is that with many bookings various fees can be applied manually and errors can occur. This works both ways. Our Feecheck audit checks for correct fee application using detailed booking data. We also check the quality and manageability of your fee arrangement.

Warrants Attention

We do not suggest that the cost-increasing practices referred to are pervasive. But we do believe that they are common enough to warrant serious attention as a necessary part of good travel procurement.

For more information please contact audits@airocheck.com or +61 0409 944 911

Airocheck Audit Pty Ltd ACN 631 714 200