Re: 10 questions to ask a tour operator reservation system supplier
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2008-01-30
Since we are all about transparency here at Rezgo, I thought I would take a moment to answer the “10 questions to ask a tour operator reservation system supplier” that Alex Bainbridge asks in his post on the Travel Technology Show 2008 blog.
- Are developments to the core system possible to be undertaken by customer request? If you have a need for a particular development - can you request a development?
- Rezgo: Absolutely. In fact, most of the features added during and after our Beta period from March 2006 to June 2007 were a direct result of customer requests. We add the request to our development schedule, create the specifications, develop the feature, and then release it based on our monthly release schedule.
- What proportion of your developments are instigated by customers vs the system supplier? - I like to see a share of, say, 50%/50% between developments that the customers want vs those that the system supplier wants. (Remember that the system supplier will want developments that increase potential sales whilst existing customers want developments that help fix their existing business challenges)
- Rezgo: Our proportion is more like 70/30 between customer and Rezgo. The majority of features are now instigated by our customers. Our experience has been that requests from customers have more “real world” potential then features we come up with.
- If you pay for a core system development - how long do you retain competitive advantage? Some suppliers say that if you pay 100% for a development you can “lock out” competitors for 18 months. If you pay 50% of a development cost - you can lock out competitors on the same system for 12 months (Often enough to push a competitor to using a specific development the season behind you)
- Rezgo: This is a good question and one that is particularly relevant for a hosted system like Rezgo. The problem is that because the system is hosted, it is essentially the same system for all members. This poses the problem of exclusivity. We developed Rezgo with a fully accessible XML API which means that front-end customizations can be made without changes to the core system, but administrative changes are shared with everyone. To date we have not done any exclusive development on Rezgo.
- How often are new releases “released”? - If these are too often (for example every couple of months) - what onus is there on you signing off these new releases - or does the system supplier guarantee that your existing business processes will not be impacted by new releases? If this is too often and you have to sign off before this new release is given to you, will the testing time be too onerous?
- Rezgo: We have a monthly release cycle, primarily for small ongoing updates, fixes, and enhancements. Major features are released on a quarterly basis or as needed. We develop all features on a mirrored development system and all features go through a rigorous testing cycle (managed by our Quality Assurance Manager, Miyuki).
- Is the system supplier based on bubble economics? For some system suppliers, new customers (and all their professional service fees) subsidise many of the exiting staff in a company however these staff supply services to existing customers. If a system supplier has a business model based on bubble economics relying on a constant flow of new customers this can be a problem for the long term validity of a company - especially if the market is stagnant or reducing?
- Rezgo: We have two sales channels; one is Rezgo.com, our hosted booking system which is subscription based and relies on recurring revenue. Our second channel is professional services which we provide to both new and existing customers.
- Where does the money they invest in Research & Development come from? Some UK system suppliers get many of their developments paid for by very large travel companies - however in the UK these companies are busy merging and standardising on their reservation systems. If the company you are considering has been happy taking money from these companies, what happens if these R&D funds dry up?
- Rezgo: The funds for ongoing R&D have come directly from our revenues. In Canada, we have a Federal program called the Scientific Research & Development Tax Credit which provides significant tax refunds for R&D expenditures. We have been successfully claiming the SR&D Tax Credit for the past five years.
- What is the 5 year plan for the system? Frankly, no one will answer this - however it is fun to ask and watch everyone’s faces
- Rezgo: 10,000 members representing 50,000 inventory items. No funny faces.
- What is the DNA of the software? Systems that have come from a travel agency background are often no good for tour operators and vice versa
- Rezgo: Rezgo is specifically designed for SME travel suppliers who provide fixed availability, fixed scheduled product, for example a guided bus tour which has 50 seats and runs three times a day.
- What are you average professional service fee day rates? Some UK system suppliers have “offshore” (Sri Lanka etc) project teams. These can often be great value. Some are based in London. They are not such good value.
- Rezgo: Being Canadian, our daily rates are quite a bit cheaper than UK system suppliers but I would guess higher than our Sri Lankan counterparts. As an active member of our local Chamber of Commerce and a big proponent of local economic development, we set a mandate not to outsource our development. Rezgo was developed by local developers, managed by local project managers, and tested by local quality assurance experts. For the record, we’ve never charged a daily rate. Our hourly rate is $150 CAD/hr. for development and $120 CAD/hr. for graphics and HTML.
- How is your system better than TourCMS that I can get for £50 GBP per month? Yes. Ask them. I dare you (Obviously many systems have greater functionality than TourCMS…. the question is whether that is worth the price difference).
- Rezgo: From my review of TourCMS, it looks like a very good product. It is, however, a very different product from Rezgo, so a direct comparison is difficult. That said, at a starting price of “FREE” and access to the distribution marketplace, Rezgo is a very compelling offering.
Thanks to Alex for the good questionnaire. I hope it helps you make your decision to use Rezgo.com as your online booking solution, and remember, if you have any questions feel free to call our office at +1 604 983 0083. Don’t worry, you won’t get routed to our call center in Mumbai. 
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