Rate parity is a contractual agreement between a hotel or B&B and its distribution agents that its room rates will remain the same across all booking platforms including the property’s website.

Rate parity is highly beneficial to online travel agents (OTAs) that have access to many travelers and charge commissions of 15-20% to property owners/operators. And remember, Bookings Holdings and Expedia Group own a majority of the travel booking sites.

There are two main types of rate parity:

1. Wide rate parity

With wide rate parity, a hotel or B&B agrees not to undercut the room prices that an OTA charges for their hotel. This agreement generally applies to all distribution channels.

2. Narrow rate parity

Narrow rate parity clauses allow hotels to offer lower rates than other OTAs, but not publicly through their own websites. With this type of rate parity, hotels can offer lower direct rates through indirect or offline channels such as travel clubs, email campaigns, and phone bookings.

The term Block Allotment is used in the Travel industry to designate a certain block of pre-negotiated rooms, Flights/seats, and rental cars that have been bought out and held by a third party such as a travel wholesaler, tour operator, travel agent, or Online Travel Agent such as Priceline, etc.

Allotments can be contracted with a tour operator or an OTA for a specific period such as a whole season, part of a season, or for any single date, and then resold to travel partners and final customers around the globe. A few days before guest arrival unsold flights, rooms, or rental cars may be released back to the supplier if such an agreement exists between the two parties. An allotment release back period is also negotiated as part of the allotment contract (e.g. four days before arrival). This frame of time is called the release period or cut-off date. Once this cutoff date occurs OTA’s no longer have that inventory available on its website until the new Block Allotment period goes into effect which is usually less than a day. In the transition from one Allottment Period to another, one OTA’s website may not have the same inventory available as another.

There are two types of rental car locations, Onsite and Offsite. Onsite airport locations pay considerable fees to be located on airport property, which are passed on to the consumer. Offsite locations do not pay fees so it is reflected in the price you pay for the rental. Offsite locations do add another layer of complexity to your travels as getting to and from the airport is your responsibility to arrange.