Wholesale / Net Rate
Wholesale (or Net Rate) distribution is a B2B model in which a hotel sells inventory to wholesalers and bed banks at a deeply discounted, contracted net rate. The wholesaler then resells that inventory to tour operators, traditional travel agents, packagers, and other OTAs around the world.
How it works
- The hotel signs a contract with a wholesaler (Hotelbeds, WebBeds, Hotusa, etc.) committing a fixed net rate, sometimes in exchange for guaranteed allotments.
- The wholesaler distributes that inventory through its B2B network of resellers — tour operators, smaller OTAs, regional travel agents.
- Resellers mark up the net rate and sell it to consumers, often as part of packages.
Why it matters
Wholesale rates were originally meant for packaged, opaque distribution — bundled into multi-component holidays where the room price wasn't visible. In practice, wholesale rates frequently leaked onto consumer-facing OTAs, undercutting the hotel's own published prices and breaking rate parity.
The leakage problem
Rate leakage from wholesalers became one of the most-discussed issues in hotel distribution during the 2010s and 2020s. Rate shoppers regularly find net rates appearing on retail OTAs, putting the hotel in violation of parity agreements with its primary OTA partners. Many hotels have since restructured or terminated wholesale contracts, or moved to dynamic net rate models tied to BAR.