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Online commission 'makes hotels more expensive'

07 | 10 | 13

Guests are often unknowingly paying more at hotels when they book online.

This is according to the 2014 edition of the Good Hotel Guide (GHG), released today (October 7th).

Editors Adam Raphael and Desmond Balmer claim visitors can end up contributing to millions spent in commission fees. Hotels also have to pay an extra 15 per cent - in addition to VAT - for each reservation made this way.

The news is relevant to the hospitality sector, as the costs could turn away other guests and affect the larger business.

According to the editors, this could have the biggest impact on smaller businesses - often managed by the owners - as the inflated prices will harm customers which are not aware it is often cheaper to book directly.

Mr Raphael said: "Many hotels claim that they have to use booking agents to fill empty rooms, but few analyse whether they really bring additional guests or merely cream off revenue. Some hotels are now providing incentives for guests who book directly."

Additionally, online travel agents often enforce other conditions, such as promotional prices. He argues this is part of the reason why UK hotels are more expensive in comparison to Europe.

The guide also claims many now advertise promotions for those who book directly - it highlights the Queensberry in Bath as an example, which offers ten per cent deductions on dinner and a 20 per cent price slash on its cocktails.

GHG's views coincide with a report released from BDO on Friday. The accountancy firm's monthly hotel survey found hotel rooms in Scotland had the biggest revenue increase of 16.8 per in July, with England (2.4 per cent) and Wales (0.2 per cent) also growing.

Aside from suggesting particularly strong growth in Scotland, it shows increased yield and profits are being made, arguably at the expense of the customer. The country's hotels had an occupancy upturn of 7.3 per cent in July, under half the increase made in revenue.ADNFCR-16001031-ID-801646459-ADNFCR


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