By: David J. Wardell

© 1994 By: David J. Wardell.  Reproduction or redistribution in any form without written permission is strictly prohibited.

Does travel distribution need a CRS? Products and service delivery options, it is said, have evolved in recent years, and CRS service costs are frequently disproportionate to results delivered. if alternative channels are available, why not use them in order to achieve lower distribution costs?

I do not believe we are anywhere near the end of the CRS era, nor do I believe that the CRSs fail to deliver real value.

But non-CRS distribution systems are under consideration by several major technology providers, and there have been efforts to avoid CRS participation and fees by travel vendors, pointing to some difficult questions that a CRS must answer.

Vendors bypassing the industry’s only basic distribution tool may achieve lower costs by avoiding fees, but they are also largely without an effective distribution infrastructure.

This situation leads to several possible conclusions:

• Agencies will continue to sell some products at a loss, which is unrealistic and unsustainable — eventually economic reality makes less-efficient businesses disappear.

• The distribution system that agencies represent is not of sufficient value to justify participation in the tools required to reach them efficiently.

If true, it is unclear what alternate distribution system delivers equivalent value and over what period of time it might become available.

It may well be that widespread access to the so-called "information superhighway" will allow vendors to communicate with their customers for a fraction of what is now paid to a CRS.

That day, however, is much more distant than many believe, and the nature of future products and services it will bring are wholly undefined.

• The access tools that the CRS represent do not themselves deliver adequate value.

We must recognize, however, that even if this is true, the alternative tools frequently advocated as agency access methods for vendors that choose not to participate in a CRS are weak and contrived substitutes at best, delivering far less value to the agency than the CRS they replace.

The question yet to be resolved is how a CRS can continue to increase efficiency and add growing value for all its customers, vendor and agent.

Current efforts are inadequate and frequently degrade productivity instead of increasing it.

There is no way that CRSs will remain the fundamental industry tools they are without moving rapidly to the next level of sophistication in terms of benefits delivered.

No CRS has made either the planning or development in-vestment to produce a satisfactory answer.

Although their demise will not be immediate and today’s alternatives are ill-conceived, it is simply a question of time —absent new strategies and productivity increases — until technology passes them by.