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  • Greta Smith

Why I work with “vetted” suppliers

Part of my job is to introduce you to vendors you might not otherwise find, but another part is risk management. Many times, clients expect me to pull some obscure, best-kept-secret vendor out of my back pocket. Sometimes I do, but they are often surprised when I recommend well-known travel companies.

Recently, a travel supplier closed its doors and filed for bankruptcy.   At a cursory glance, you would do business with this company (before the bankruptcy, of course). This supplier had been in business for over 20 years and was planning itineraries with travel agents all over the world… Until last month, when the company sent an email that it was closing its doors and no longer doing business. There are a couple of bad things that happen when this occurs:

  1. There are reservations for which guests have paid the supplier, but the payment was never made to the end travel provider. I am referring to air, tours, accommodations, transfers, etc- the small pieces that make up the larger puzzle of a trip. Someone has to foot the bill for the travel components that were paid for but never confirmed (by payment) with the end provider.

  2. Travel agents won’t get paid. This company still owes thousands of dollars in commissions to agents whose clients have already traveled with them. Even though this is the lesser of the 2 negatives, it’s still a pretty big deal.

So, how do I avoid BOTH of these baddies?

  1. I am SUPER picky about working with smaller suppliers.  If I’ve not worked with them personally, I check with other agents to find out their experiences. If their rates are coming in significantly lower than others, I want to know why.

  2. I keep an eye on my favorite travel insurance provider’s list of covered supplier default companies.  This is a good way to gauge whether other businesses in the industry consider the supplier to be stable.

  3. If other agents or members of my network are saying that a supplier is taking a long time to pay commissions, I steer clear.  This is the biggest red flag that there’s something rotten in Denmark. No matter how big online booking gets, suppliers rely on agents for a large percentage of their business. If they are not nurturing that relationship, something is up.

Honestly, it’s pretty darn uncommon for a travel supplier to close its doors. While no process is foolproof, by having a vetting process in place for new and small suppliers I can mitigate most of this small risk.

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