Convenience store chain encroaches on travel agent turf

TAIWAN’S second largest convenience store chain, Family Mart, is planning to process applications for Taiwanese nationals travelling to China at its 2,800 retail outlets in the country.

Family Mart will offer entry permit extension services for Taiwan residents headed to the mainland, charging NT$499 (US$17) per head, undercutting local travel agents who normally charge between NT$500-NT$600 for the same service.

Roger Hsu, secretary general of Taiwan’s Travel Agent Association, said: “This is illegal. According to our laws, only travel agents and immigration agents can process visas.”

He added that non-travel agencies are also prohibited from selling outbound air tickets and tours.

Family Mart is planning to sidestep the regulations by delivering completed applications to a single travel agency for processing, believed to be local branch of China Travel Service (Macao).

Hsu said: “We talked to the legal authorities at the Taiwan Tourism Bureau, and we were assured that it would be illegal for a non-travel retail business to aggregate visas and deliver them to a single travel agency. The TTB will tell this agency that this is not permitted.”

Although low in price, fees generated by processing entry permits for travel to China can contribute a significant level of income.

Flying Master CEO, Chen Min Tang, said as much as 20 percent of his revenue comes from this source. “These fees are significant, due to the high volume of Taiwanese travelling to China, and they are part of what enables us to exist. Not all Taiwan travel agencies specialize in outbound to China, but for those that do, the loss of this business would be a serious problem.”

Daver Lau, general manager, Amadeus Taiwan, held a more pragmatic stance: “If you take a longer view, the distribution business will evolve in such a way that the line is less defined.”

“For example, 10 years ago, airlines didn’t sell direct, but now Internet sales are part of their strategy. Even then, the business didn’t all shift to the airlines. Travel agencies also found new ways to adapt. Eventually, there will be a new equilibrium.”

By Glenn Smith

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