OTA Commission / Distribution Margin
OTA Commission is the contracted percentage fee deducted by Online Travel Agencies (e.g. MakeMyTrip, Booking.com, Agoda, Expedia) from the gross room reservation value for facilitating bookings.
Why It Matters for Independent Operators
Commissions in India, UAE, and Southeast Asia typically range from 15% to 24% + GST. On ₹10,00,000 monthly OTA turnover, commission expense can reach ₹1,80,000 to ₹2,40,000, representing a major cost center.
Practical Scenario & Calculation
[Illustrative Scenario] A resort with ₹8,00,000 in gross monthly bookings on MakeMyTrip at an 18% commission rate pays ₹1,44,000 monthly (₹17,28,000 annually) in distribution fees.
How Operators Can Apply This Concept
Calculate net channel contribution for every OTA. Shift marketing effort toward direct channels and optimize listing quality to capture organic billboard effects without paying for paid extranet sponsored placements.
Common Misunderstanding to Avoid
Commissions are often calculated on base room tariff excluding taxes, but platform payment gateway processing fees and promotion participation may increase effective distribution costs.
OTA Commission Loss Calculator
Estimate OTA fees from inventory, rates, occupancy and entered channel shares. Optional settlement deductions are inputs, not statutory tax advice.
OTA Optimisation & Rate Management
Professional advisory and hands-on commercial execution for your property.