When I think about how long we have been doing our auditing services, it kind of blows me away. I was a sophomore in High School when Topaz was started. 37 years is a long time - and trust me when I tell you I have lost a ton of hair since then. However, more importantly, we will all agree the airline deal has gotten more and more complex.
We know this at Topaz because our team has to dissect and understand all these deals - all the nuances of how they are calculated - and applied each and every day. We do not rely on contract loading to determine lowest airfares. We check and validate each and every calculation to make sure these deals are working for you.
The contracts today are massive. Far gone are those days when two and three page contracts exist. I remember a good friend John McGhee who worked at Japan Airlines, pitching me and a client for a secondary deal. At the end of the meeting we agreed to his terms and offers. He then delivered a three page deal with a simple discount of x percent off of all airfares. Wow. Anyone have those anymore? Three pages!
But give the airlines credit for discounting what they can and balancing discounts with performance. How many times have you agreed to contract terms with multiple airlines that result in you delivering market share of 150%? Today you put yourself and your entire program at risk. Further, the airlines have determined those really low airfares do not need any more discounts - just the expensive airfares.
In the end there may not be much a customer can do to simplify contracting with the airlines. They are massive today - many over 100 pages in length - with complex terms that require hours of understanding just to use them. Today, these contracts are a price to do business with any airline. But think about these suggestions as you navigate through the contracting process:
* Understand the terms offered not just by looking at what is offered, but also what is not offered.
* Professional assistance may be necessary to not only analyze your deals and performance but to be a sounding board for negotiating leverage.
* Competitiveness between airlines in a certain market may result in wide variances in prices for what you consider to be similar products; pay attention!
* Just because you think your deals are loaded correctly, they may not be and should be tested to ensure they are utilized correctly.
* Even if they are loaded correctly, are the discounts that you have worked so hard to contract being utilized? Many times they are ignored and not used.
Airline contracting is complex - but in the end - the discounts should prove to be valuable to you, your company and your travelers.