Travel agents ask govt to review productivity-linked bonus system

Jays Jacob
10 May 2003

Kochi: The IATA Agents Association of India (IAAI) has urged the central government to review the prevailing productivity-linked bonus (PLB) system, which will ruin and eliminate the ordinary travel agents all over India.

IAAI national president Biji Eapen says the incentives introduced by airlines should be applicable to all IATA agents, irrespective of targets. "Based on the adopted market strategy, an airline has the option to introduce such incentives, but the same should be common to all agents, equal and transparent."

The ultimate beneficiaries are the airlines, as its productivity can be doubled by selling and promoting the products through all the IATA agents in India rather than concentrating and channelling through a couple of consolidators, he says.

The transparency will facilitate all the IATA agents in India to participate in selling Air-India products and in turn the disparity and discrimination between high- and low-yield productivity agents can be avoided, he adds. A recent survey conducted by IAAI revealed that most of the agents are doing business in a very competitive market with a very thin-profit margin.

A-I continues to offer special deals and bonus schemes to certain agents without any adequate understanding and transparency, he says. The bonus, which the airlines is offering to these few agencies based on high productivity, is not supposed to be invested again in the market."

But, in practice, these agents with their wide network all over India, are harming the market by diluting this bonus commission along with their normal commission of 7 per cent to provide incentives which an ordinary agent cannot even dream of, he alleges. "A-I is accruing a heavy revenue loss by promoting a monopolistic set-up."