Selling Dubai: What Travel Agents Need to Know

Selling Dubai: What Travel Agents Need to Know (If You Want to Actually Make Money)

It’s one of the most visible destinations on earth. Towering hotels, a year-round event calendar, and commissions that, on paper, look strong. But if you’re not careful, Dubai can also quietly drain your margins.

At Antravia, we’ve worked with agents, DMCs, and hotel partners who’ve learned this the hard way. So here’s what you need to know if you want to sell Dubai profitably and sustainably, especially in a market where local regulations, taxes, and supplier practices can quietly cost you more than you think.

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1. Add-ons in Dubai Can Wipe Out Your Commission

Dubai is famous for add-ons, such as airport transfers, private safaris, dune buggies, yacht hire, brunches, helicopter tours. It’s also infamous for how last-minute upsells and client add-ons can be booked outside your ecosystem.

Clients land and start booking excursions directly with hotel desks, ride-hailing apps, or DMCs you never even recommended. You lose the upsell, the supplier relationship, and the post-trip loyalty.

Tip:

– Wherever possible, pre-package your upsells into the initial quote

– Price them clearly, even if optional

– Ask your DMC or hotel if they’ll protect commission on later bookings if the guest was referred through you

This is especially important for higher-spend clients who treat Dubai like a menu - the margins are in the add-ons, not the room.

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2. Understand the True Cost of Tourism Fees

Dubai imposes a ‘Tourism Dirham’ fee per room per night, under the Dubai Executive Council Resolution No. 2 of 2014, administered by the Department of Tourism and Commerce Marketing (DTCM). The amount varies from AED 7 to AED 20 per night based on hotel classification.

Most hotel quotes — especially those from OTAs and international wholesalers — exclude this fee by default. It’s typically settled by the guest at check-in or check-out.

This creates three problems:

– You look like you underquoted

– You might eat the cost to preserve goodwill

– You’ve anchored the total trip value inaccurately, which affects upselling

Best practice:

– Convert the fee to your client’s currency and list it clearly

– Do not bundle it unless the hotel confirms inclusion in writing

– Always highlight it as a local tax that’s payable on-site to avoid last-minute complaints

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3. Be Cautious of FX Exposure in AED

While the UAE dirham (AED) is pegged to the U.S. dollar at a fixed rate of 3.6725, many Dubai-based suppliers still quote and invoice exclusively in AED. This becomes a problem when:

– Your clients are paying in EUR, GBP, or AUD

– Your commissions are settled in AED and then converted

– You incur transfer fees, slow payment windows, or card processing charges

Even a 2–3% difference in rate timing or fee load can cut your profit significantly.

Tip:

– Work with suppliers that settle in your preferred currency

– Use multi-currency virtual cards or platforms that let you lock in FX rates

– Confirm in writing what the commission is calculated on — gross total, net base rate, or net of VAT and service charges

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4. VAT in Dubai: What You Need to Know as a Foreign Agent

As of 1 January 2018, the UAE implemented a 5% Value Added Tax (VAT) under Federal Decree-Law No. (8) of 2017 on Value Added Tax, administered by the Federal Tax Authority (FTA).

This VAT applies to:

– Accommodation

– Transportation and tours

– Food and beverage

– Leisure services

If you’re a foreign-based travel agent, you are not typically able to reclaim VAT paid on UAE-based goods or services. This means:

– VAT-inclusive quotes are real costs, not recoverable input tax

– Commissions may be calculated post-VAT, further reducing margins

– If a DMC asks you to invoice them for commission, and they are VAT-registered, you may run into compliance complications if you do not have a UAE TRN (Tax Registration Number)

Confirm in writing:

– Whether VAT is included in quoted amounts

– On what figure your commission is based

– Whether you are expected to issue any invoices for service rendered in the UAE

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5. Supplier Loyalty Is Thin — Especially below the Luxury Tier

Dubai’s hotel market is massive, with over 800 hotels and tens of thousands of listings on platforms like Booking.com and Agoda. Not all of them operate with strong agent protections.

Below the ultra-luxury tier, some hotel and apartment suppliers:

– Undercut agents on direct channels once a quote is sent

– Remove negotiated extras unless reconfirmed at check-in

– Refuse to honour agreed commissions if a booking appears to have been diverted or resold

In the mid-market and budget segment, suppliers are often transactional. They don’t see long-term partnership as a priority. That’s why most top-performing agents stick to luxury resorts, branded groups, or DMC-backed inventories with written rate protections.

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6. Understand Which Dubai You’re Selling

Dubai is not one market. It’s at least three.

1. Mass-market Dubai

– Budget packages, volume OTAs, short-lead bookings

– Clients driven by price, not brand loyalty

– Commission is low, and margins are tight

2. Mid-market or Multi-country Dubai

– Often sold as part of Middle East or Indian Ocean itineraries

– Clients expect quality but want value

– Add-ons make a difference here

3. Ultra-luxury Dubai

– Branded villas, private safaris, yacht charters, exclusive chefs

– Clients expect tiered perks, concierge service, and zero friction

– Commissions are lower, but transaction value is high

– Supplier relationships matter more than price

If you’re quoting everyone the same way, you’re probably misfiring with all three.

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Final Word

Dubai is full of opportunity, but the financial risks are just as real. You can earn well — if you know what’s built into the price, what isn’t, and how to protect your commission before a single transfer is booked.

At Antravia, we help agents not just book — but quote, price, and structure their Dubai product like professionals.

If you’re serious about selling Dubai as part of your long-term portfolio, we’ll help you get the numbers right.

👉 Contact Antravia

📩 Want to talk through your Dubai setup?
Book a call by sending us an email. We will help you spot where you might be losing money—or how to avoid it before you do.