A look at exclusivity clauses in corporate travel contracts: Travel Weekly

Mark Pestronk

Mark Pestronk

Q: Our company has received the business of a midsize company whose journey finances was about $1 million right before the pandemic. In our company account contract, we have a clause stating that we will be the unique supplier of journey arrangements for the phrase of the agreement and that the account will not use any other travel company. The account refuses to indicator the deal mainly because it cannot completely assure that we will get all the business. Is there an different method that might be acceptable to the two get-togethers?

A: There are quite a few alternate formulation that I have designed more than the previous several many years of creating and editing corporate contracts. Listed here, I current them in a hierarchy of exclusivity, likely from most exceptional to minimally exceptional.

I realize the client’s position, for the reason that there are normally rogue tourists who refuse to use journey organizations in general or the selected agency in individual. Even so, as a standard rule, the tighter the exclusivity clause, the less the leakage you will suffer.

1st, the ideal clause, which I realize your consumer has previously turned down, would condition a little something these kinds of as this: “Customer shall chorus from working with any other travel agency or journey administration organization for the business enterprise travel of client’s workers and from bypassing agency by building travel arrangements instantly with any airline, resort or car rental company or by moving into into a GDS deal right with any GDS seller.”

Take note that the clause not only prohibits the shopper from working with a different company but also prohibits booking instantly with a provider. In conditions the place the GDS segments are pretty vital to the economics of the offer, you could also want to prohibit the shopper from acquiring its individual GDS contract, thus depriving you of GDS incentives.

Second, you could concede an exception for at-airport variations and emergencies where the traveler desires to have the airline reissue a ticket or exactly where a stranded traveler calls an airport resort late at evening. Even though these preparations could be created by contacting your soon after-hrs service, some travelers feel the require to do the job with the provider specifically in an unexpected emergency.

So you could incorporate this to the conclusion of the exclusivity clause: “The foregoing shall not implement to tourists at airports who desire to deal directly with airways, accommodations or vehicle rental corporations for final-minute variations.”

3rd, if none of the above-famous clauses are acceptable, you could offer that the account have to amend its journey plan to need that all travel bookings go by means of your agency. The issues is that travel policies are often whole of exceptions or present no enforcement mechanism, but the greater part of employees will absolutely abide by the journey coverage.

Fourth, alternatively of an exclusivity mandate, you could supply that the journey coverage be amended so that your company is selected as the “desired travel company,” “primary journey agency” or “most popular system of booking journey” for employees. Although “favored” and “key” have no clear indicating, they do at minimum are inclined to make personnel think that they ought to be using your agency.

Linda W. Davis

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