Is Wholesale Airfare Really On Sale?

You’ve seen the ads—“Cheap Tickets,” “Wholesale Airline Tickets,” “Low Cost Business Class Tickets”—but have you ever wondered how these ‘wholesalers’ get their inventory and if they really offer lower cost tickets?  I did some research and here’s what I found.

I have a real trip to Bangkok that I’m planning for mid-July and I’m looking for the best possible business fare ticket from New York.  My business pays for coach airfares and I can upgrade using cash or miles. For this trip, I’m using cash since I’m actually low on miles.

My first stop was the ITA software matrix owned by Google. Using their search engine, I found a fare on Air China from New York JFK to Bangkok BKK for $4,226.98. This was the third lowest fare. The other lower fares were on Norwegian Airlines and Royal Jordanian. I’ve had a bad experience with Royal Jordanian, so I wasn’t going to consider that fare. I did some research on Norwegian and found that there weren’t any options for transferring miles or earning miles on either Star Alliance or One World airlines. So I ruled them out. That’s how I ended up with the Air China itinerary (it was $200 more than the two lower fares.)  You can’t book flights through ITA, so I went to Air China’s website and confirmed I could find the same fare. I did.

Next, I decided to try three different types of “discount” websites. cFares.com, Wholesale-flights.com and Consolidatorwebfares.com. Each has different results which I explain below.

I tried cFares.com, which promises the lowest priced international tickets guaranteed and all I got were pop-up windows for Expedia and Kayak—the cFares.com screen showed blank five times.  I contacted support and they said I needed to become a member.

So for $18 (the required minimum number for the monthly plan) or for $50 a year you can see the prices they offer. Based on the note at the bottom of the screen suggesting “you carefully read the terms and conditions” and “insure you fully understand how cFares works” and “we suggest you print off a copy of the Terms of Service for your reference” I decided to read them.

What’s in the Terms of Service? Well, it says that cFares is a meta search engine for the travel industry. That means that cFares searches other travel sites to provide cFares’ customers with information regarding the price, availability and details of travel products offered for sale at those sites. cFares customers can visit the third party sites and purchase products offered for sale. cFares does not sell any products on its Website. cFares is not the vendor of record for any travel products that customers find by initiating a search on the cFares Website.

What do I get for my membership fee? cFares provides members with a “rebate,” however it’s not clear from their terms what the rebate is or how they calculate it.  Here’s the policy:

Rebate Eligibility
Platinum memberships are issued to one individual only. A Platinum membership does not entitle relatives, friends, partners or business associates of the Platinum member to receive rebates or other membership benefits. Platinum member benefits, including ticket rebates, are only available to Platinum members. Some Platinum tickets come with a rebate for the Platinum member buying the ticket. To be eligible to receive the rebate, the Platinum member must:

Be listed as a passenger on that ticket. Rebates will not be paid if a passenger is not a Platinum member.

Complete and submit a rebate request form and accurately provide the information required.

A Platinum member in good standing. Rebates will not be issued to members who have cancelled their Platinum membership.

I was able to find a statement about their so-called “Lowest Price International Fare Guarantee.”  That statement says “If after making an international flight reservation through cFares, you find that a lower price (including all taxes and fees) was available for booking at the time of purchase through another online travel service, notify cFares by fax or email that same day and upon confirmation cFares will refund you the price difference up to a maximum of $50.00, the ‘Guarantee Amount’.” $50 maximum refund? How does that make any sense if I find a ticket that is $100 less expensive?

So far, I don’t see how cFares provides any values.  So for the sake of research I decided to sign up for a monthly membership expecting to spend at a minimum $18. Now, if it turns out that the rebates are great, maybe I’ll continue my membership or buy an annual membership.

After registering I did a search for the exact same itinerary I’d found on Air China’s site.  The site opened up Expedia and Kayak, again, and the fares were much more expensive on face value than I had paid for the outright ticket on Air China.

Expedia did not offer the exact same itinerary , but there was one that was very close (The difference was that the Beijing to Bangkok flight was on a partner airline. Otherwise, it was the same). The lowest price was $5,326. Wow.  So how much was the rebate cFares offered? $50. Yes, that’s right, $50.

Next I compared their rebate to the Kayak fare. Kayak didn’t have the 12:50 departure so I looked at the cheapest Air China flight: $5,497.  More than Expedia and yet, cFares offered the same $50 rebate. Are you starting to see a trend here?

I contacted cFares to ask about their rebate policies but have not yet received a reply. Fed up with cFares I moved on.

Next I tried Wholesale-flights.com. I entered my search criteria and was taken to a form to request a fare quote. I elected to receive the quote via email.  To my surprise, my telephone rang about 10 minutes later and it was an agent from Wholesale-flights.com.  He turned out to be extremely nice, so I forgave the fact that they called rather than emailed.  He asked a ton of questions, collected my frequent flyer preferences (this is something that set them apart) and asked about my timeline.

I told him about the $4,200 fare on Air China’s site and he asked how much he’d have to save me for me to book with them. I said at least a hundred dollars, but that I needed a ticket that would earn miles and status. This is when he started to explain how Wholesale-flights.com was able to provide lower cost business fare tickets. In many cases, the company uses their corporate miles to buy a rewards ticket and then charges the customer for the ticket. Through that method I could see how you’d save a lot of money. For example, on US Airways a ticket from New York to Bangkok in business class is 120,000 miles. US Airways sells miles and frequently runs promotions for 100% bonuses. So for $1,750 you can buy 100,000 miles. Using that logic, the company could “buy” miles from an airline and book a rewards ticket for a few thousand dollars. Since I told them I’d found a $4,200 fare, he could come back and sell me that reward ticket for, let’s say, $4,000 and I would have been happy. Seems like there’s a significant amount of money to be made using this method.

In the end, the agent sent me a note saying the lowest fare he’d found was $5,000 dollars and he suggested I book the $4,200 fare. Interesting that I could find a better fare than a “wholesaler.”

My last stop was Consolidatorwebfares.com. The website is the least user friendly but did not result in any pop-up windows or required membership fees. They had the exact same itinerary that I found on Air China’s site and at first glance, I thought they had a better price, but then I noticed the +taxes and fees note. The total fare was $4,246.98 and still more expensive—though only slightly—than Air China. My guess is that the fees make up the $20 difference.

In the end, I went forward with the Air China fare for $4,226.98. Yes, it’s a high price to pay and I wish I’d had better luck with the so-called “wholesale” options. But, this fare ended up being $800 less than any other fare I could find (excluding the two I mentioned earlier).

As a comparison, I did a few additional searches on cFares and Consolidatorwebfares.com—I didn’t want to ask Wholesale-flights to price out a flight I wasn’t actually considering.

I compared an itinerary form Charleston, S.C, to New York (LGA). The cFares price was $621 with a, you guessed it, $50 rebate and the Consolidatorwebfares.com fare was $598. On Kayak.com I found a fare for $540, which matched a USAirways.com fare. Then I searched for a flight from New York (JFK) to Chicago (ORD). The consolidator websites had fares between $389 and $425, while Kayak found fares from $307 to $350. With the cFares rebate, it would have been possible to save $7 on this fare, enough to recoup one month’s membership fee. In all other cases, the wholesalers were not the least expensive option.

The lesson here? Buyer beware. The Internet is a great place to conduct research, but don’t be lured in by the advertisements.  Do your homework and compare prices for the best deals.

Stacey Segal is the co-founder of First2Board.com. She writes regularly at first2board.com/verygoodpoints.