The three fee models, and when each one wins

Owners compare percentages because percentages are what get advertised. The model underneath the percentage moves more money.

How to read the numbers on this page. A figure with no marker is quoted from a primary source and linked at the foot of the page. ^reported means the company that charges it publishes no public rate card, so the range comes from trade reporting rather than from the charging party. ^modelled means it came out of the model set out on the methodology page, which you can disagree with line by line.

Model 1: pure commission

The manager takes a percentage of every booking and charges nothing else. Published rates run from 18% to 20%, and the honest versions state plainly what is inside — one published rate card lists housekeeping, laundry, pool and garden maintenance within the fee and adds that there is no separate setup, listing or photography charge.

What it does well. An empty month costs you nothing in management fees. The manager's income moves with yours, which aligns the marketing effort properly. There is one number to check on a statement.

Where it hurts. On a villa that books well, a percentage of a large number is a large number, and the manager's cost of serving you did not rise in step. And because the percentage is charged on gross booking revenue rather than on what survives the platform, a strong month on a high-commission channel is expensive twice.

Model 2: hybrid — a retainer plus a lower percentage

A fixed monthly amount, reported at USD 800–1,500 per month^reported, plus a reduced commission reported at 12–18%^reported. A fixed monthly retainer plus a reduced percentage. No operator located during this build publishes a retainer figure publicly; the band is from trade reporting and should be treated as an opening position, not a rate.

What it does well. It prices the part of the job that does not vary — staff who are employed whether or not guests arrive, a villa that needs cleaning and a pool that needs dosing in an empty month — as the fixed cost it actually is. On a villa that books consistently, the lower percentage is worth more than the retainer costs.

Where it hurts. A quiet quarter. The retainer does not care, and on a genuinely thin month it can exceed what the pure commission would have taken in total.

Model 3: marketing-only

A lower percentage — one published rate card sets it at 10% — covering listings, pricing, guest communication, reporting and tax filing, and explicitly not covering operations or staff. You employ and supervise the people, you handle maintenance, you own the problems.

What it does well. If you live in Bali, or have someone reliable who does, this is the cheapest way to buy the part you genuinely cannot do yourself, which is distribution.

Where it hurts. It is not a lower price for the same thing, it is a smaller thing. An owner in Sydney who buys a marketing-only plan has bought a second job and a supervision problem in a time zone that is awake while they are asleep.

The same three models on a thin month

This is the comparison that never appears in a pitch, and it is the one that decides whether a fee model suits your villa. Here are the same three arrangements at USD 2,200 of gross booking revenue rather than USD 6,000:

The ranking flips. That is the whole finding, and it is why “what percentage do you charge” is a worse opening question than “show me this on my last twelve months”.

Model 4, which you should be careful with: revenue share

A share of what is left after agreed costs, rather than a share of the booking. It is presented as the fair one, and on paper it is: the manager only makes money when the villa makes money.

The problem is structural rather than moral. In a revenue share, the manager is the party that decides which costs are agreed — they buy the cleaning, they hire the plumber, they choose the linen supplier. Unless the contract closes the cost list, itemizes it, and fixes who may add to it, a revenue share is a commission whose base only one side can move. If you are offered one, the clause to insist on is a closed schedule of deductible costs with a cap on anything not on it.

The clause that beats all four models

On the model, moving a 20% commission down to 18% on a USD 6,000 month is worth about USD 108. Moving the same villa from services rebilled with a markup to services rebilled at cost is worth about USD 1,040 at the extremes of the model.

One of those is a repricing that a manager will resist on principle because it resets their whole book. The other is a sentence. Ask for the sentence. The clauses worth arguing about goes through the rest of them.

Common questions