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Are you prepared for another supplier default?


Pressure to cut costs, increase margins and improve efficiencies has never been greater. Add to this the unique risks associated with the travel industry and it’s no wonder agencies are concerned about how they protect their clients and their businesses.

We’ve all read the stories of recent collapses in Australia and awaited news of refunds, only to find payouts are a mere proportion of the costs. IATA has confirmed a refund of 21.88% for Air Australia’s demise, meaning agents and their clients will lose almost 80%. Kumuka’s collapse only months later left agents again filing claims to recover their costs.

The way in which an agent deals with these crises can make the difference between receiving the rebook when the consumer is refunded or losing them and all their future bookings forever. Managing the situation well will generate positive word-of-mouth which when everything else is failing; will elevate a brand and cement customer loyalty. But being able to do this requires a well thought-out action plan that covers everything from customer service through to financial risk management.

There’s also no substitute for peace of mind - knowing that even if insurance or membership coverage fails, you still can recover your costs. The solution is simple – pay by credit card and you’re automatically covered.

An even smarter solution is a new technology called eNett Virtual Account Numbers (VANs). eNett VANs are accepted through the MasterCard network, guaranteeing all payments and securing them from risks such as supplier default. However, unlike physical credit cards, VANs are integrated with travel booking processes, reducing handling times and making real-time reconciliation a breeze. Agents can even earn revenue on every payment made with a VAN. To find out more, visit www.transformingpayments.com

 

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Written by: Anthony Hynes
Published: 31 August 2012

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