Concept
Net rate
Also known as: net pricing, wholesale rate, B2B rate
The short answer
A net rate is the wholesale price a supplier (hotel, transfer company, activity vendor) charges to a travel agency, DMC, or tour operator, without commission baked in. The reseller adds its own margin on top before quoting the traveler.
In depth
In travel, the same hotel room can have several prices on the same night. The rack rate is the headline price posted publicly. The gross or commissionable rate is the retail price an agency quotes to a traveler, with a commission already baked in that the supplier pays back to the agency after the stay. The net rate is the wholesale price the supplier charges directly to a B2B partner, with no commission attached. The partner is free to mark it up however it wants.
DMCs and tour operators negotiate net rates supplier by supplier. Volume commitments, allotments (rooms held in advance), exclusivity, and seasonal patterns all shape the deal. Some rates are static (contracted for a year), others are dynamic (pulled live from a channel manager or bedbank). The mix matters: static rates lock margin but expose the operator to overpaying when demand drops, dynamic rates flex with the market but make pricing harder to communicate to clients.
Software is where margin survives or leaks. A serious itinerary builder must keep the net rate and the selling price in separate fields. The designer view shows margin and supplier cost, the client view shows only the marked-up total. When the two get tangled (a designer accidentally shows the net rate, a markup is applied to the wrong base, a supplier rate change does not propagate), margin disappears silently. This is one of the strongest arguments for a purpose-built travel agency platform over a generic CRM plus a Word document.
Common questions
01 What is the difference between net rate and gross rate?
A net rate is the wholesale price the supplier charges a B2B partner, with no commission baked in. A gross or commissionable rate already includes a commission the supplier pays back to the reseller after the stay. With a net rate, the reseller picks its own markup; with a gross rate, the markup is fixed by the commission structure.
02 How do travel agencies get net rates?
Net rates are negotiated directly with suppliers (hotels, transfer companies, activity vendors), often with volume commitments or allotments. Smaller agencies and solo designers usually access net rates through bedbanks, DMCs, or wholesale platforms that aggregate supplier inventory and pass on B2B pricing.
03 How is margin calculated from a net rate?
Margin is the difference between the selling price quoted to the traveler and the net rate paid to the supplier, expressed as a percentage of the selling price (or sometimes of the cost, depending on the operator). A purpose-built itinerary builder keeps the two values separate so margin is visible to the designer and hidden from the client.
