What a net rate is, and why it decides your margin
A net rate is the wholesale price with no commission built in. You add your own markup on top — which is what makes selling travel B2B profitable rather than merely busy.
The basics
Net, gross and commissionable
Three prices get used loosely in travel, and confusing them is expensive.
The public price is what a consumer sees on an airline or hotel website. A commissionable rate is that price with an agreed percentage returned to you after the booking — the supplier decides how much you earn. A net rate is the wholesale price with no commission inside it at all: you buy at that number and you choose what to sell it for.
The practical difference is control. On a commissionable rate your margin is set by someone else and moves when they change their programme. On a net rate your margin is the gap between what you paid and what you charged, which is a decision you make per booking, per client, per season.
Net rates are normally lower than the public price, because the supplier is selling through a channel that carries its own distribution and servicing cost. That gap is the room you are working in.
Worked example
The same hotel, three ways
Four nights, one room, a mid-market European city property. Illustrative figures to show the mechanics, not a quoted rate.
In practice
What to watch when you buy net
Net pricing is better, not automatically simpler. These are the things that separate a good net rate from a headline one.
What is included
Taxes, city levies, resort fees and board basis. A cheaper net rate that excludes a €4-per-night city tax is not cheaper.
Cancellation terms
A non-refundable net rate and a flexible one are different products. Compare like with like before claiming a saving.
Currency and timing
Net rates are often contracted in the supplier's currency. Know when conversion happens and who carries the movement.
Rate parity rules
Net rates generally must not be displayed publicly at the net figure. Marking up before display is a contractual requirement, not a preference.
Markup strategy
Flat markups are simple but leave money on high-value bookings and price you out of cheap ones. Rules by value band work better.
Payment timing
Who pays the property, and when, changes your working capital. Merchant-of-record matters more than most agencies expect.
Net rate FAQs
Straight answers
- Amadeus
- Travelport
- Sabre
- Expedia
- WebBeds
- Hotelbeds
- TBO
- Restel
- Mystifly
- Duffel
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