Contents Introduction chapter 1

Figure 3. 
types of tour operators.
 
Source: 
by author
 

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2.2 
Evaluating alternative methods of tour distribution and recognize the 
importance of new forms of electronic reservations
TAXES, INSURANCE FEES, SERVICE CHARGE 
Contracted rates must indicate whether fees, taxes, and any other charged are 
included. The commonly used term for a rate that includes all charges is “net 
inclusive.” Contracted rates that do not include these charges are commonly referred 
to as “plus-plus” (Net ++), the first “plus” being the taxes due, and the second “plus” 
being the service charge. These are normally a percentage of the base rate. 
BOOKING AND RESERVATION PROCEDURES AND CONDITIONS 
Each supplier has its own reservations policies and procedures. These musts be and 
are usually clearly spelled out in the contract agreement. The conditions to keep in 
mind are: option dates, cancellation penalties, amendment policies, cut-off period, 
deposit payments and revisions. An option date is a date preset by the supplier, by 
which time the tour operator must firm up or cancel a confirmed reservation. 
Cancellation penalties are levied by the supplier when confirmed reservations are 
cancelled. Amendments refer to a change of dates for a specific reservation. Some 
suppliers consider amendments as cancellations and levy penalties accordingly, 
CUT-OFF PERIOD 
Some suppliers grant tour operators free sale facilities. Free sale means that a number 
of seats, beds, rooms and the like are allocated to a particular tour operator to sell 
within a period of time leading to a cut-off date. Upon reaching the cut-off date, the 
unsold seats, beds, rooms and the like automatically revert to the control of the 
supplier. The tour operator may no longer sell these after the cut-off date. Unlike an 
option date/time which is given at the time of booking, the cut-off date is preset when 
the negotiations for allocations are undertaken. 
DEPOSIT PAYMENTS 

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Most suppliers will require a deposit payment to confirm reservations. If no credit 
facilities exist between the supplier and the operator, the contract agreement must 
specify this, including the refund policy and conditions in case of non-utilization of 
confirmed reservations, subject to cut-off period agreements. Revisions refer to 
changes in number of seats, beds, rooms reserved or changes in passenger’s names. 
Unlike amendments which refer to change of date(s) for the delivery of a particular 
product or service, revisions maintain the basic date(s) but the number of names of