Travelers Using Agents Have Entered a Brave New World of Service Fees : Bookings: Those days of always getting something for nothing from agents is changing. Charges for some services are becoming more commonplace.

Some consumers are discovering that a growing number of travel agencies are likely to charge for some types of services that were once “free.”

Travel agents derive their income from commissions--usually from airlines, cruise lines, hotels and car-rental companies.

But they don’t make money from reissuing airline tickets, handling frequent-flier coupons and delivering tickets. Since these activities represent no income or low earnings, agents may assess service fees to cover the time spent in performing such work.

In some cases, service fees are applied to the cost of the travel arrangements booked. Agents may also waive service fees in various situations and for good clients.

The subject of service fees is a controversial one among agencies. And as agents clash over marketing philosophy, consumers can expect to face a service fee for assorted agency activities.

“Travel agencies with street-front locations are the ones most likely to assess service fees because of the tremendous amount of walk-in traffic they get,” said Linda Hutson, owner of Ferguson Gates Travel in Los Angeles.

“The key to a service charge is to compensate ourselves for labor on nonprofitable items,” Martha Scott, manager of Glendale Travel, said. “While travel agencies are in a service business, we’re not nonprofit organizations.”

Los Angeles-based Larchmont Travel is an agency that has held off levying fees in the past, but has now instituted a service fee of $5 for processing airline promotional coupons that clients bring in.

“Handling these coupons is time-consuming and they mean less income for the agency since the value of the ticket is less and so is our commission from the airline,” said general manager Sam Gentz.

Gentz predicted more travel agencies will likely institute some service fees in the future. “It’s basic economics. This is one business in which the harder you work the less you make. You can spend hours looking for the lowest fares, which then mean less income. Agencies are taking a realistic look at imposing more service fees.”

All About Travel in Northridge has just instituted a $25-per-hour nonrefundable service fee for arranging customized itineraries.

“In the past we had a nonrefundable $100 deposit that could be applied to the trip,” said Pat Campbell, manager of the agency and former chairperson of the Association of Retail Travel Agencies, a major trade group. “But too much time can be taken with these arrangements and we have to cover our costs.”

Potential clients are advised up front of the hourly charge for this service, and given an estimate of the likely amount of time needed.

Campbell, for one, doesn’t believe in assessing a service fee for handling promotional coupons. “The fee is insignificant and it could scare people away,” he said.

Campbell also predicted that more travel agencies would implement some kind of service fees in the future.

“Travel agents are more business-oriented today than in the past, and they tend to look more at the bottom line. If they don’t get paid enough by the suppliers to cover their costs, they’ll pass the cost on to the consumer. It’s a natural evolution.”

Glendale Travel has a brochure on each desk explaining its fees. Some examples: $10 for handling frequent-flier and other promotional coupons, and reissuing airline tickets.

“We might sell someone a ticket for $300, the fare goes down to $200 and the client comes back to us to reissue the ticket,” Scott said. “Whether we reissue the ticket or the airline does it, we still lose some of our commission from the airline. But if we do the work, we may charge a $10 service fee to cover our time.”

Similarly, Glendale Travel may assess $10 for a hotel booking, if there is no airline booking with it.

“That’s because the chance of our getting a commission from some hotels is slim,” Scott said.

“If we book a cruise or a tour, we ask for a nonrefundable service fee of $25. This amount is applied to the final payment of the client. Then if the person changes their mind, we still have something to show for our work.”

Sometimes the delivery of tickets, visas or other documents to the client’s home or office will incur a fee. “We have free delivery within our normal marketing area, but we might charge $25 to $50 for a staff member to drive farther afield,” Scott said.

A $50 fee is also charged for hard-to-make holiday bookings and reservations for special bargain offerings that require a good deal of phone calls and staff time. “Of this amount, $25 is applied to the cost of the arrangements and we keep $25 as our fee for the special work,” she said.

On the upper end of the scale, for clients seeking a customized tour, Glendale Travel charges a $100 nonrefundable service fee that is applied to the trip. Clients are charged the actual cost of any telexes and other communications, with no mark-up.

Glendale Travel also charges service fees of $10 for all air fares sold for under $100, and for any record search in agency files. “It’s very seldom that we actually ask for the air-fare fee,” she said. “We figure if the fare is that low, we’ll get lots of business through it.”

Sounds like plenty of potential service fees, but when it comes down to it, Scott says, the agency generally waives fees for repeat clients.

“It’s always a judgment call,” she said. “We’re much more likely to charge a fee to someone who walks in off the street who we haven’t dealt with before. We can also tell when someone is just shopping around and not really ready to go ahead with specific travel arrangements.”

Does the agency lose business by charging such service fees?

“We debated this issue but decided that while we might lose some people, they were the kind worth losing,” Scott said.

“Our experience is that people tend to respect our professionalism more when they understand that our time represents money, too. I think travel agents who are afraid to charge service fees don’t respect their own professionalism.”

Meanwhile, consumers should understand that not all agencies are the same. Some agencies are full-service, others may specialize in low-cost travel and not offer a full range of services. And some are cruise-only agencies.

Don’t assume that you’ll get every service just because you give your business to an agency. For example, a full-service agency is much more likely to contact you about changes in flight schedules after you’ve purchased a ticket than will a “low-frill” agency.

Agencies should alert you right away about any service fees they might charge, either verbally or in writing. Make sure that you understand when such fees are applied to the bookings you actually make.