Tour Operators and Travel agents negotiate contracts with suppliers of various travel services, such as hotels, activities, transfers, car rentals, and also visas and insurance to be able to sell these services to their customers (tour operators generally sell to travel agents who sell these services in turn to their end-customers).
After the travel company signs a contract with a specific service provider (for example a hotel or visa supplier), the tour operator or travel agent will need to enter the contract terms into the system to be able to sell the product to the customer through the Reservations System. This is done by creating a Contract in the Administration Tools.
Contracts allow tour operators to negotiate agreements with suppliers who do not use content interfaces. These can be direct contracts with the supplier who owns and operates the travel product (the hotel owner), or they can be with third parties who are selling you travel services purchased from suppliers (for example, packages operated by third parties).
Contracts allow the tour operator to sell the travel product online, and receive instant confirmation because of built-in allocations. The travel products sold through contracts can be sold as stand-alone services or they can be combined with other products to create a package or escorted tour.
The tour operator can use the contract to offer quotes to customers, reserve services from suppliers, handle operational details, and of course also price the service being sold through the Reservations System.
There are a number of advantages for using the Contracts module to sell Visa and insurance products through the system. These products tend to have standard contracts, which are slow to change, and are fairly simple to maintain.
Each contract represents a single travel product being sold. If you negotiated an agreement to sell rooms in 5 different hotels from a supplier - you will need to create and maintain a separate contract for each hotel. If you negotiated an agreement for visas for 5 different countries - you will need to create a separate contract for each visa. You need to create a separate contract even if the selling price and terms are the same for all the products. However, this is easily accomplished using the Copy function.
Contracts usually include the net price from the supplier (supplier prices). To this amount, the travel company can add markup, if relevant, to create the selling price to the customer, or apply the commissions that were negotiated with the supplier. Markup and commissions can be added inside the contract or applied separately through the business rules.
A contract with a supplier is going to need to include all or part of the following information:
Standard pricing for all markets, or sub-pricing categories for each market for when the tour operator has preferential buying options for the different markets.
Validity dates (seasons) and their effect on pricing
Price levels, such as different room types in a hotel, standard, superior or deluxe, or one entry, multiple entry, six months with visas.
Price components, such as price per adult, price per child, person in double, and person in single.
Allocations or freesale, such as room allocations in a hotel, or ticket allocations for an activity.
Before creating a contract in the Contracts module, you are going to need to open an account for the supplier and enter into it the service types sold by the supplier and the work conditions you negotiated.
Contracts in the system can be divided into three categories:
Contracts built around leg services (flight, transfer, ferry, and train).
Insurance contracts in which you can define add-ons to the price (such as extreme sports) for some of the passengers, and some of the days in which the policy is valid.
Contracts for the rest of the service types
The structure of the contracts is largely the same for most services.
Each contract includes the following two tabs:
<service type>: Used for entering the general details of the product, such as the product name, supplier, destination, address, phone number, and images.
Price List: Used for defining the pricing of the product according to markets, seasons, price levels and price components.
Some contracts may also include additional tabs:
Price List - Group Rate: Used for defining special rates for operating tours, packages and groups. Appears in hotel, activity and transfer contracts.
Allocation: Used for adding allocations and freesale to the contract. Allocations allow the travel company to sell the product as confirmed, until an agreed upon cut-off date.
The <service type> tab is the tab in which you enter the general details of the contract. The tab is usually divided into 3 expanders:
General: In this expander, you can enter the general details of the product. The information that needs to be entered (both mandatory and optional) is different for each service type. For example, with a visa you are required to enter the Embassy name, the Service Provider and the Supplier Paid, and with a transfer, you are required to enter a Destination, Category, Service Provider, and the Supplier Paid. You can choose to enter the service Location and product Attribute.
Description: In this expander you can enter an HTML file containing a description of the service, and thumbnail images of the service which are displayed in the Reservations system. This can change with other service types. For example, with visas you can upload a PDF file of the visa application.
Advanced definitions: In this expander, you can edit the voucher and transaction definitions. By default this information is the same as what is defined in the supplier's account, but can be customized for each contract. Also, in this tab you can choose whether to calculate selling prices according to the price list definitions or according to the markup business rules. Additional information can be defined for different service types, such as the booking channel, and automatic confirmation of reservations.
The Price List tab is where you define the selling prices of the contract. These prices are structured hierarchically from general to specific definitions.
Market: This is the market to which the price applies. For example, a hotel supplier may offer one price to the American market and a separate price to the Russian market. Both prices can be managed in the same price list using separate markets. In the Reservations System, you can define which market the reservation is being made for, which determines the prices that are displayed. With travel agent accounts that are attached to only one market, the market is automatically detected by the system. With visas and insurance only one market (All) is required.
Season: The season is the date range in which the prices are valid. Each price list can contain multiple seasons, and each season can include multiple periods (which do not have to be consecutive) in which the price is valid. With some products the seasons change on a monthly and sometimes weekly basis, such as hotels and activities that have peak seasons and off-peak seasons that are frequently updated. With visas and insurance, the season rarely changes, as the price can remain unchanged for several years.
Price level: Price levels are used for creating the different prices in the price list. For example, with a hotel contract, the price levels represent the different room types, such as, standard room, or sea view room and with visas, the price levels can be one entry, multiple entry, six months, etc.
Price component: The price components are the detailed breakdown of the price level. There are fourtwo types of price components: Main and Supplement (for all services), and Family Plan and Board Base (for hotels).
The main price component is the base price around which the selling price is built, for example Per Adult per day.
Supplements are additional components that can be added onto the main price. For example, Service Fee.
The Family Plan is a special price component for hotels that want to create a special price for families that share a room.
The Board Base is the meal plan the hotel offers. For example, Bed and breakfast, Half board, Full board, or Room only.
Markets, seasons, price levels and price components can be defined in the system before building the price list. If these components have not been defined in advance you can also define them when creating the contract, and they can then be used when creating future contracts.
Each level of the price list can be copied. When constructing a price list it is recommended to build one market, one season, and one price level. After these are defined you can copy them multiple times and update the information for each one. For example after defining all the price components in the first price level, instead of starting over with the second price level, you can copy the entire price level and change the prices as necessary.
The negotiations with the supplier on the selling terms often include a number of allocations. Allocations allow the tour operator to sell the travel product as confirmed until an agreed upon cut off date. The most common type of allocation is for hotels where suppliers will offer a number of room allocations which can be sold immediately as available. Allocation terms usually include conditions regarding a release date for when the allocation is not used so that the hotel supplier will have the option of filling the rooms independently. Suppliers can also offer unlimited allocations (freesale) with release conditions allowing the travel company to sell as many rooms as possible.
Services that offer allocations or freesale include: hotel, car, activities, cruise, restaurant, guide, package and escorted Tour.
The track changes mechanism allows you to view recent changes to contracts according to date, type of change, and user who made the change. This is useful for updating contracts, allowing the user to know when the contract was last updated, and what was updated.
Check price list is a tool used for validating the price list. The tool lists in a separate window all occurrences in the price list of missing or invalid information.
When price list seasons expire, they are automatically transferred to the price lists history, leaving only the current seasons in the price list. The Show History mechanism allows you to view the price list for seasons in the past, which is useful in comparing prices and terms.
Price lists have an Update Prices mechanism, which can be used to periodically update the prices in the price list, which is useful when renewing the contract, or updating the prices for new seasons. The mechanism is very flexible with different options available. You can update the prices, update the exchange rates, selling and supplier prices, apply a rounding policy, or choose to update specific price components only.