The American Society of Travel Agents (ASTA) is urging agencies heavily dependent on selling cruises to look at their revenue data and make a determination of the role Non-Commissionable Fares (NCFs) play in their cruise sales and revenues.
ASTA noted the growing concern of agents with NCF's and has released a new white paper on the history and current state of NCFs. ASTA said the white paper is an effort to help agency members understand the role NCF's play.
"We know many of our leisure-focused agencies have great concerns about NCFs,” said Zane Kerby, ASTA president and CEO.
“Clearly, travel agents should be fairly compensated for creating demand for the cruise lines. At the same time, those companies have the right to price their product as they see fit. That’s why ASTA recommends that each agency take a close look at their revenue data to determine the right product mix and business model for them," Kerby said.
ASTA said it conducted a series of interviews with agency members and cruise line executives to produce the document. The process included reviewing historical records on NCFs, including fare lawsuits in the late 1990s that precipitated the change in how NCFs are presented.
A large selection of cruise line invoices also were analyzed to look for patterns in how NCFs are applied to specific types of cruises, ASTA said. The paper describes changes travel agents are making to mitigate revenue losses, and also reviews average NCF/gross fare ratios.
“Ultimately, ASTA urges those agencies heavily dependent on selling cruise to take a few hours and look at their revenue data and make their own determination of whether the NCF is reasonable and if profitability is sustainable,” said Kerby, and if not, adjustments in product mix or agency business model should be considered.
Members can access the white paper for free. Non-members may purchase the paper for $49.