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Mon 11 Aug 2008 04:00 AM

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Agents require regulation for their own good

Emirates' move to slash commission to zero in the UAE will radically change the travel agency landscape.

News that Emirates Airline will slash commission to zero in the UAE from October will radically change the travel agency landscape across the country, nowhere more so than in Dubai.

Most carriers look set to follow Emirate's lead, meaning that by the end of the year, agents operating in the UAE will no longer earn a crust from selling airline tickets unless they charge a service or transaction fee.

We will therefore embark on an era where only the fittest will survive and I believe that Dubai could suffer the most agent casualties, for many reasons.

First of all there are just too many travel agents operating in this market, or rather, too many agencies offering the same product.

A sizeable percentage of the 300 or so Dubai agents in operation rely on selling airline tickets alone and survive by discounting and undercutting other agents.

In the new zero commission environment I really do not know how they will make a crust given that there will be no margin to discount. They surely will be forced to susbsidise these discounts?

If Dubai boasted 300 agents who each offered a point of difference, then fair enough, but as we know, travel ‘experts' are all too thin on the ground at present.

But what Dubai really lacks during these times of trouble is agent solidarity.

The reluctancy of many agencies to join the Dubai Travel and Tour Agents Group (DTTAG), which aims to represent the interests of the emirate's agency community, has proved that.

The group, which despite making great strides in its mission to subsidise training and enter discussions with industry partners over pressing issues, still faces scepticism from experienced agency managers who should know better than to shun the opportunity to create a force to be reckoned with.

If more agencies joined DTTAG they would have more bargaining power with airlines and other travel suppliers and they would also have more clout to stamp out rogue agencies that give the travel agent community a bad name - those that undercut, discount and often, are on the brink of bankruptancy.

The success rate of such agency groups has been proven - you only have to look at the accomplishments of the ATTAC in Abu Dhabi, and importantly, the camaraderie amongst its travel agent members who realise that there's strength in numbers.

What is needed is for DTTAG membership to become mandatory.

It the Dubai Department of Tourism and Commerce Marketing (DTCM) made it compulsory to join DTTAG before agents were given a license, this would make agencies conform to some sensible rules and regulations designed to boost the success of the travel trade industry in Dubai.

The time is ripe for such a move to be implemented given that the DTCM is currently rolling out rigorous licensing laws anyway.

If DTTAG membership became mandatory it would raise standards and like it or not, weed out the bad eggs.

The result would be a band of united travel ‘professionals' who were well equipped to succeed.

Gemma Greenwood is the senior group editor of ITP Business' hospitality magazines.

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