The two rates, defined
| Rack rate | Net rate | |
|---|---|---|
| What it is | The public asking price any traveller sees | The trade price granted to a tour operator |
| Who sees it | Everyone | Only the operator’s trade relationship |
| Who sells at it | The lodge itself (direct/OTA presence) | The operator adds their margin on top |
| Why it exists | Anchor and benchmark — the price the market knows | The operator’s commission, structured into the price |
Why the system works (when it’s respected)
- The operator’s margin lives inside the price — the client sees one professional number, not a fee line.
- The lodge stays in control: operators must still contact the property to confirm — availability, minimum stays, single-supplement rules are the lodge’s call.
- Rack protects everyone: if an operator undercuts the lodge’s rack rate, they’re not making margin — they’re burning the relationship.
- Season and residency rate structures apply to net rates too — a low-season net rate is not a year-round net rate.
What goes wrong today
- Rate chaos: net rates live in PDFs and WhatsApp threads — operators quote from the last price they remember.
- The enquiry-middleman tax: a client who finds a lodge through an operator’s site often emails the lodge direct, cutting the operator out.
- Lodge discovery is broken: small camps depend on a handful of operators knowing they exist.
Where this is heading (and why we care)
The fix is boring infrastructure: lodges publish their properties and rate structures once; operators see those properties — with their negotiated net rates — while planning trips; every booking still goes to the lodge for confirmation. The lodge multiplies its distribution across many operator websites without losing control, and the operator sells confidently from live, correct rates. That is exactly the network we are building into TravelBookingWidgets: lodges list once, operators plan with real rates, the lodge confirms every booking the same way they always have.
Should a tour operator ever quote the rack rate?
Only by mistake. Quoting rack means the operator either shows the lodge’s own price (and the client books direct) or charges the client more than the lodge would (and looks like a rip-off). The operator’s price is net + margin — always.
Does the lodge have to accept every operator booking?
No — and that is the point. In a healthy rate relationship the operator requests, the lodge confirms. Availability, overbooking protection and house rules remain the property’s decision, which is exactly why lodges can safely distribute through many operator websites.