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Calculation and usage of mark-ups

Inside the Effective Tours, there is two models of prices: Net Rates & Rack Rates

Depending of which rate is used, the Markups works in different way. Let’s start with the scenario, that you have a hotel with the Net rate

It is a very important part. This is needed to avoid confusion with rates, when the agents are connected to your account, you will manage markups for each agent individually. Selected mark ups automatically added on top of the rates in ET for Net rates, or deducted from Rack rates.

So let’s say your lowest rate/base rate/travel agent rate/NET rate (however you want to name it) for the room is 100$/night.
As an example there are 3 agent’s connected to the property:

Agent A (big tour operator); Agent B (travel agency); Agent C (your friend’s agency)

This price of 100$, is the minimal price you can afford to sell the rooms. Later, when you start connecting your agents (we will discuss it after) you will provide them the markups rates accordingly.

For Agent A (Tour Operator) you want to provide with a best markup of 2.5%.
For Agent B (Travel Agent) you want to provide with a competitive markup of 5%.
For Agent C (Friend Agent) you want to give the best rate possible and put a markup of 0%.

Each time, when you will update any of the rates for the rooms or supplements, your agents will automatically receive the prices according to markups assigned by you.

So it means for the example above:
For Agent A (Tour Operator) 100$+2.5% = 102.50$. Means you are selling to this agent for the price of 102.50$
For Agent B (Travel Agent) 100$+5% = 105$. Means you are selling to this agent for the price of 105$
For Agent C (Friend Agent) 100$+0% = 100$. Means you are selling to this agent for the price of 100$

IMPORTANT: In case if your hotel operating with Rack Rates then all of the Markups will be removed, from the price. So it you have a 100$ rack rate, an a markup of 5%, then the final price will be 100$-5% = 95$

Check the following diagram for better understanding the flow

File:ET Rates Flow.jpg