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To: crusty old prospector

FYI- they were the reason Braniff went bankrupt in the 80’s. All the travel agents used Sabre. AA flights preferentially showed up first on their queue. The bums got away with it.


7 posted on 05/06/2023 12:23:16 PM PDT by crusty old prospector
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To: crusty old prospector

That’s not entirely true, I owned a travel agency for nearly 10 years when agencies sold the overwhelming majority of all airline tickets.

We did not use Sabre, we started out using System One from Eastern/Continental Airlines, then switched to Amadeus.

Showing up first in the reservation system was not an overwhelming choice of traveling public.

The first choice almost always was price, followed by direct versus flights requiring a change of planes.

The standard commission on airlines for travel agencies was 10% of the base ticket price.

What airlines would do is pay an override commission back to dollar one if you exceeded their market share in a given market, especially if you could move real volume to the airline.

For example in the market we operated in Delta had a 27% market share, if you sold 28% you got a 1% override commission back to dollar one, and if you sold more you got a progressively larger commission, if you sold more 32% or more you might get upwards of 6% extra commission paid out quarterly.

The agency we owned was small and we sold around 1.2 million in airline tickets annually, if we sold $300,000 in Delta a year and got the full 6% in extra commission or $18,000 that was a nice bonus during the year.

What did the airlines in was poor management, cut throat competition and union troubles, which is what happened to Eastern Airlines.


11 posted on 05/06/2023 1:16:34 PM PDT by srmanuel
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