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Bargain Hunting? Try Bucket Shops

March 22, 1987|PAUL MARKSON | Markson is a Los Angeles free-lance writer.

You find them on supermarket bulletin boards, or on the walls of neighborhood bars, or stuck under the windshield wiper of your car . . . flyers offering air transportation at what appear to be bargain prices.

If you're like most people, you probably don't give such items a serious thought. "Another shady scheme to part me from my money," you figure, and into the circular file goes the leaflet.

Or you may see a newspaper ad, briefly outlining the same deal. Maybe you don't respond to that, either, because the price doesn't coincide with anything that the major airlines are advertising, or perhaps simply because no airline is named in the ad.

Welcome to the world of "bucket shops," a growing if as yet somewhat undefined part of the airline ticket distribution network.

The Gray Area

Buying a ticket on a scheduled airline in the traditional manner, either direct from the carrier or through a travel agent, has certain advantages, regardless of price. But travelers in increasing numbers are finding that there are savings to be had by dabbling in the gray area of bucket shops.

One thing that the ads and handbills have in common is that they never tell what airline is involved. That, of course, is a marketing disadvantage, because often it brings the legitimacy of the offer into question.

If the operator chooses not to identify the carrier, the thinking goes, then it must be because the carrier is a second-rate, off-the-wall outfit that nobody in his right mind would want to fly with.

Such thinking is understandable. And quite unfounded.

The truth is, many of the major international carriers cut deals with certain selected operators to help them fill their flights. These operators are often honest-to-goodness appointed and bonded travel agents.

Pivotal to the agreement worked out between these people and the airlines is that no brochure, no advertisement, no solicitation ever spells out the name of the carrier providing the transportation.

The reason is very simple . . . by the prevailing standards of airline reasoning, that is. The carrier doesn't want XYZ Travel Agency openly offering its seats in London, or Tokyo, or Rio at prices lower than those it is usually charging.

There is also a question of the airline's legal right to offer its services in this way. Technically, it is against the law for an international airline to discount its published tariffs.

A Lot of Controversy

The Department of Transportation has made it clear that it doesn't intend to take disciplinary action against the airlines because it sees the practice as being in the public interest. But there is a lot of controversy over the department's refusal to enforce the law, and the carriers don't want to push their luck by going "on the record," as it were.

When you respond to a bucket- shop ad the operator will tell you the name of the airline. He just can't advertise it.

But if you then call the airline in question and ask about the fare, chances are that you'll be told it doesn't exist. The price negotiated between the operator and the carrier's marketing people may not even be programmed into the airline's computer system, or may appear under a code known only to a few employees, on a need-to-know basis.

Now you understand why I call this a "gray area."

Bucket-shop operators have been common in Europe for many years. It's estimated that maybe as many as half of the people buying tickets in, say, London and Amsterdam do so through such outlets, at below tariff.

But they have been relatively unknown in the United States. That is changing.

The airlines are feeling the pressure of competition. If everyone went out with their flights full, there would be no need for them to make deals. But all flights don't go out full. Although some flights may be sold out, maybe even most of them in peak months, they still fly with many empty seats over the course of a year.

And one of the ways in which the airlines attempt to overcome that weakness is to let strategically placed "specialists"--our friends the bucket-shop operators--market the product at a local level, using a fare not necessarily offered systemwide.

Empty Plane Seats

The carriers hope, even if they must accept passengers at discounted prices during their busy months, to make up for it in off-peak periods, when they're possibly going out half-empty.

Travel agents who can't offer seats at these prices, and can't always buy them from the operator who can, see bucket-shop operators as discriminatory, as diverting traffic and costing them income.

Still, they are a fact of travel industry life now and they're not likely to disappear in the foreseeable future; far from it.

Some kind of seal of approval --or, at least, acceptance--came the way of bucket-shop operators recently at a meeting of one of the nation's largest retail agency consortia. Its members jointly process several hundred million dollars' worth of business a year, most of it high-ticket, corporate executive travel.

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