How to reduce the cost (or pay nothing!) of a booking system.Jun 16, 2022
The number one reason we hear from tourism businesses on why they don’t install a booking system is money. They don’t have it.
If this is you, then don’t we have a handy little article for you then!
There are 3 main ways where you can reduce the cost of a booking system that are simple to implement.
1. Choose a system where they charge a commission fee on online booking only.
This means that the fee is passed onto the customer and they pay for it as a “booking fee” at checkout and you pay nothing! A few things to consider if you are looking at this path and that includes:
- Calculate what the fee would look like for the customer, know the % being charged. If you are a high ticket item, this might make you cost prohibitive. If it looks like a reasonable amount, then go fo it.
- Make sure you state ahead of the booking process that you charge a booking fee. You don’t want customers surprised by the fee AFTER they have gone through the process of booking. It is also annoying for the customer and can cause trust issues at the start of the relationship. You also want to make sure you comply to ACCC.
- If you work heavily in distribution and trade and are looking to grow your direct business, then this might not be the best option for you as it then makes your direct bookings the highest price in the marketplace, and potentially move more bookings back into distribution.
- This option usually means that you have to use their native payment gateway, so be prepared for this (which in itself can be super handy and saves a LOT of payment gateway paperwork).
2. Lift your rates.
If you choose a subscription option and you don’t want your customer to pay (i.e. you absorb the fee), then you can figure out how much the booking system costs on average per person regardless of where they book (direct online or via trade/distribution). Often it can work out to be 50c-$1 per person. You can potentially lift your prices by the amount and allocate those funds to paying the booking system bill. While technically you are still passing it onto the customer, it is distributed more evenly across the board and more cost effective for everyone. If you do decide to do this, remember that your prices and rates that a re contacted have to remain as is for the contractual period/year.
3. Set and Charge a Booking Fee.
Another option for subscription fee systems is that you can often set a “Booking Fee” in the back-end of the system. This usually can be a % or a set fee. While it may not cover the entire booking system fee, it can cover a vast portion of it. Again, be sure to check that the fee you set complies to the ACCC rules (you don’t want to be caught out!).
Beyond the bookings, be sure to look at what else you get from a booking system. They are designed to help streamline operations, simplify communications with visitors and guests, allocate work and resources and gather data. There is so much value that a Booking System can give beyond the actual booking and it will soon become the backbone of your business.
Not sure about Pricing works? Be sure to download our online tours Booking System Pricing Template here.
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