I read with interest the remarks of Doug Rhymes in 'The Market Makers' in the February issue of Airline Business. While I share most of Mr Rhymes' opinions, I am under the impression that 'outsourcing' is a new, better word for the old concept of 'airline representation'.
We feel that in order to arrive at a real process of outsourcing, we should first create a different environment. Specifically, the industry needs a change in the terms of reference which are still governing the legal aspects of the relationship between service providers (the general sales agents) and the airlines.
The Iata standard contract, which was drawn up almost 50 years ago, still seems to be the sole legal instrument in that respect. Some of its clauses are clearly obsolete.
The benchmark for remuneration remains a meagre 3 per cent, which can hardly be described as appealing.
At Air Promotion Group we have been fostering a new concept and a different approach. We feel that airline representation, as it was known, is something from the past and we should create different terms of reference under the auspices of Iata.
I would call it more appropriately a 'contract of partnership', in which the relationship between airline and service provider is put into a different focus, and where costs and benefits can be shared appropriately.
We do not want to 'represent' airlines. We should like to create a mature and managerial relationship in which risks are shared equally, and the investment made in equipment, software development, locations and personnel can be recognised.
We believe that this profession is evolving very rapidly, and feel that Air Promotion Group can make a substantial contribution to this change.
APG is actively lobbying for this approach. We are sponsoring for the fifth time an annual industry conference in Cannes in November, at which we call on industry executives and 'market makers' to debate the problem of airline distribution.
We have invested time, money and effort to develop new software packages capable of reducing airlines' costs substantially. We have made innovations, with a degree of success, in accounting and ticketing and can provide airlines with a complete range of services at flexible costs.
I cannot find more appropriate words than those of British Airways' Peter Brass to describe the need for change. Yet the experience we have acquired so far is that airlines, despite their need for reducing fixed costs, remain reluctant to change. The old ghosts are still present.
We remain attached to the idea that outsourcing of sales, marketing and reservation activities has a strong future; we will continue to work in this direction.
Paolo Sani
Development manager
Air Promotion Group
Paris, France.
Source: Airline Business
