Channel Commission Cost Calculator

Work out channel commission cost instantly with clear inputs, formula shown and shareable results.

About Channel Commission Cost Calculator

Channel cost is commission plus payment processing, and both come off the top before any operating cost. At a combined 19% the channel takes almost a fifth of revenue, which is why the cost of acquiring the same booking directly is the relevant comparison.

Formulas

Cost per booking

Cost = Booking value x (Commission % + Payment processing %)

Effective rate

Effective % = Commission % + Payment processing %

Worked example

With the default values below, Channel Commission Cost Calculator returns Distribution cost per booking of $4,512.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Booking value: 24,000
Channel commission: 17
Payment processing fee: 1.8
Bookings through this channel: 320

Results

Distribution cost per booking: $4,512.00
Net revenue per booking: $19,488.00
Total channel cost: $1,443,840.00
Effective cost of distribution: 18.800%

Step by step

1Values used
2Cost per booking
3Effective rate
4Distribution cost per booking= 4,512.00
5Net revenue per booking= 19,488.00
6Total channel cost= 1,443,840.00
7Effective cost of distribution= 18.800

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation or compounding frequency into account.
Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

Is commission negotiable?

Rates are largely tiered by volume and visibility programme, so the negotiation is usually about placement rather than the base rate.

What is the billboard effect?

The tendency for online travel agent listings to drive direct bookings too, which partly offsets the commission cost and is hard to measure.