There has been much discussion recently about agency relationships for niche tour operators both here and on Alex's blog. I'm interested to understand the pros and cons of structuring commissions transactions and payments.
As I understand it there are broadly three ways of working:
1. Agent collects commission and full payment and passes the money onto the supplier less their commission (I'm not sure exactly when the money changes hands in this instance?)
2. Agent collects deposit only (of which part or all is their commission, with the balance of the deposit passed on to the operator) and customer is responsible for paying the balance of the total to the supplier
3. Agent facilitates payment of deposit directly to a tour operator either by passing the credit card details on (which strikes me as a little dodgy) or by storing the tour operators merchant number in their system.
From a tour operator's point of view and a travel agents point of view I'd be interested to hear the favoured option and the pros and cons. (I'm not using the term 'agent' in its strictest legal sense), just as a term to cover somebody promoting a niche tour operators products.