Prior to the CTD program, the financial model between travel agencies and corporations was in the form of a rebate, whereby the agency returned a percentage of commissions back to the
corporation, usually on a quarterly or semi-annual basis. Over the past several years, commissions have been consistently reduced by the airlines, to the point that travel agencies are now assessing management fees which are deducted from any collected commissions, and the end result is usually a quarterly invoice, or a minimal return of total commissions earned. There is no reliable audit trail for the commission income in the agency environment.
In 1998, Republic New York Corporation (Republic National Bank) became the first corporation to receive accreditation as a corporate travel department (CTD). Andrew Menkes, CEO of PTC, was the creator of this program when he was Vice President of Global Travel at Republic. Currently, there are 150 approved CTD locations, ranging from $100 million in airline sales to under $1 million.
The CTD program allows corporations to receive all commissions directly from the suppliers airlines/hotels/car rental companies (hotels are the most viable revenue stream), and outsource any and all services to one or more travel agencies or travel suppliers. The difference between a CTD and a travel agency is that a CTD is a purchaser of travel; a travel agency is a seller of travel.
For more information on the CTD program visit the ARC website.
If you would like to learn about the CTDA (Corporate Travel Department Association).