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COMMTRAK CORPORATION

COMMTRAK CORPORATION Hotel Commissions... Managing for Maximum Yield Roger Miersch GlobalWare Big League Users Conference January 30, 2002. COMMTRAK CORPORATION. Overview - since 1987. Specializing in hotel commission billing and recovery services.

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COMMTRAK CORPORATION

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  1. COMMTRAK CORPORATIONHotel Commissions... Managing for Maximum YieldRoger MierschGlobalWare Big League Users Conference January 30, 2002

  2. COMMTRAK CORPORATION Overview - since 1987... • Specializing in hotel commission billing and recovery services • Delivering missing and unpaid hotel commissions to travel agencies • The only outsource firm concentrating on “after-market” collections

  3. Managing for Maximum Hotel Yield • The Current Marketplace • Commtrak Services • Issues…Overcoming Objections • The Message

  4. The Current Marketplace • The hotel industry’s existing commission payment formula to agencies is likely to continue in the near term due to a number of factors... The Good News...

  5. Factors… 1. Absence of hotel oligopoly…manyownership, franchise, management groups 2. Agency distribution costs for hotel firms are a smaller % than for the airlines 3. Pre-existing commercial net rate programs already permeate the industry

  6. The Current Marketplace The Bad News... • Don’t assume a 10% commission yield on hotel sales The Better News... • Realistic hotel commission yields* of 5% to 8.5% are still way ahead of current airline yields of about 3.76% (ARC , June 2001) *Gross commission divided by recorded hotel sales

  7. Hotel Commission Yield Variables... 1. Number of unrecorded cancels / no-shows 2. Number of duplicate records & agent errors 3. Number of net rate bookings 4. Difference between “actual” and “recorded” bookings… inflates yield perception 5. Effectiveness of reconciliation and recovery efforts

  8. Commtrak Services • Supplemental billing services…not primary reconciliation • Data extract from GlobalWare • Over 60,000 properties in data base / QC utility • Professionally printed, mailed invoice documents

  9. Commtrak Services • Accurate posting to your file of all hotel responses • Repetitive pursuit of unanswered bills for up to 24 months • Delivery of quarterly reconciliation file and $ check for recovery share

  10. Commtrak - Benefits • Financial arrangement is contingency based, and incurs no direct cost to your agency • Revenue to your agency is incremental sincewe only pursue records that you or others have closed • Insures the maximum level of hotel income

  11. Overcoming Objections “There’s not enough uncollected hotel commission for me to worry about.” • The return is in real dollars, and can add significantly to your annual hotel income • Can any agency today afford to overlook existing, legitimate income sources?

  12. Overcoming Objections “My agency manages commissions and bills unpaid hotel records. I don’t need a 3rd party billing service.” • If you bill any item more than once or twice, your costs will probably exceed your potential income • Using aggregate customer invoices, our per item costs are significantly less than any agency program, and we will deliver revenue missed by your system

  13. Overcoming Objections “I’m too busy putting out fires and managing other issues to address hotel recovery right now. Contact me in 60 days.” • In 60 days there will just be another crisis, but the overdue commission items will now be that much older, and with diminished value • A Commtrak program is easy to implement, and easier to maintain

  14. Overcoming Objections “My agency uses a 3rd party reconciliation firm that also bills unpaid hotel records. We don’t need a separate recovery firm.” • Other 3rd party firms focus more on primary reconciliation, and usually stop billing after 180 days • Many of our customers first use other third party firms for the primary reconciliation • We will invoice well beyond their normal billing cycles, and will generate additional hotel income

  15. The Message • You have an untapped pool of hotel income • Tapping that resource costs nothing • Program implementation is simple • Additional hotel revenue will be delivered

  16. Commtrak... For more information • Roger Miersch at: 610-586-6359 rmiersch@bellatlantic.net • www.commtrak.com GlobalWare data extract steps: www.commtrak.com/gw_v31.htm www.commtrak.com/gw_v32.htm Scofield Management Systems www.smsglobal.com

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