Working with wholesale distributors is a great way to distribute your hotels inventory and rates to a variety of online travel agencies, retail agencies, tour operators and airlines through a single interface.
Wholesalers normally request to receive NET contract rates (Static Rates), although in recent years this has changed to also include BAR contract rates (Dynamic Rates) which are distributed via the channel manager.
Key ingredients to consider when working with wholesalers:
Accept that rate parity does not exist! Working with a NET rate or a BAR rate, wholesaler systems will deduct commission and offers, and then run their distribution algorithms. Their clients will receive various prices that will inevitably end up on popular shopping websites.
‘Everyone buys from everyone!’, but not everyone is stable when it comes to payments! Limit the number of wholesalers you work with to the largest and most trustworthy of your choice. This will greatly simplify administration related to distribution, reservations and financials.
Identify reputable wholesalers by the numerous source markets and destination countries they work with. This means a better quality and wider distribution for your property.
If you use a channel manager, make sure your chosen wholesalers are supported. Most of the well-known wholesalers will already be supported, however less known wholesalers are likely to need to develop new connections, which means time and costs are involved.
Working only with BAR contract rates (Dynamic Rates) limits your exposure within the wholesaler’s distribution. Keep in mind that not all wholesaler clients have the ability to accept dynamic rates, a large proportion still operate in a traditional sense, i.e. static brochures and set prices.
Wholesalers also offer additional exposure to their network, in the form of featured hotels or special campaigns supported by extra marketing and sales efforts. These extra services can have tremendous positive effects on your production levels, but they are normally charged as extra. You may be able to ask that such services are implemented and then deducted from upcoming service invoices. Most wholesalers are open-minded to driving business and are always open to discussion and negotiation.
It is important to take the time and consider working with wholesalers, since it opens up your hotel to new and exciting markets.