Tour operators must avoid “short-changing” customers when compensation is owed, according to Carnival UK’s general counsel.
John Snyder warned of the reputational risk to businesses when they attempt to avoid paying full compensation.
“Don’t try to short-change the customer,” he said, adding: “Put the customer at the heart of what you do.”
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Snyder, who spoke at Abta’s Travel Law Seminar on May 1, said operators should make sure they deliver proper compensation “the first time” rather than paying a lower sum initially.
“Going back around to give everyone extra compensation is not only embarrassing, it’s also not very effective,” he added.
Snyder also highlighted travel agent insolvencies as among the key challenges faced by tour operators, citing failures including Thomas Cook, Harvey World Travel and Gill’s Cruise Centre.
He said pipeline monies are a central concern and he endorsed the practice of collection through regular instalments or via direct customer payment.
When an agency collapses without having paid the operator, Snyder said it is difficult for the operator to continue to deliver its service.
“It’s tough on the tour operator because they still need to perform, but that’s how it should be,” he added.