What third-party booking fees actually cost a small hospitality business
A booking made through an OTA can hand over 15 to 25% of its value in commission. The same booking made directly costs closer to 4%. Most small hospitality operators never run that math.
Published September 2, 2026
A small inn, bed and breakfast, or vacation rental relying entirely on listing platforms is paying a toll on nearly every booking it takes — including the ones from guests who'd have found the property anyway. Industry hotel-distribution cost analyses put OTA commissions at roughly 15–25% of a booking's value, against approximately 4–4.5% for the same booking made through the property's own site.
The American Hotel & Lodging Association has noted that Expedia and Booking Holdings together control roughly 95% of the OTA market — a small number of platforms with real leverage over how those fees get structured, and little competitive pressure to lower them.
Where this actually bites
The math is straightforward once it's laid out. A $300 booking through an OTA at a 20% commission nets the property $240. The same booking taken directly, even accounting for a modest cost of running a booking system on the property's own site, nets closer to $287. That gap compounds across every returning guest, every referral, every booking that didn't need to come through a third party in the first place.
What a direct-booking site actually needs
- A booking flow that's as fast and trustworthy as the OTA's — slow, clunky, or unclear pricing sends guests right back to the platform they know.
- Photos and information that match (or beat) what's on the listing platforms, since guests will compare the two.
- A reason to book direct beyond price — a small perk, flexible cancellation, or simply a faster, cleaner path to confirmation.
- A phone line that's actually answered — see why a hospitality business can't afford a phone line that rings out for the other half of this.
None of this means abandoning listing platforms. It means having a real alternative for the bookings that don't need to pay the toll. See how we build direct-booking sites.
Frequently asked questions
Commissions typically run 15–25% of a booking's value — Expedia has charged 15–30%, Booking.com around 15% — compared to roughly 4–4.5% for a booking made directly through the property's own site, per industry hotel-distribution cost analyses.
Often, yes, for discovery — a listing platform puts a small property in front of travelers who weren't searching for it by name. The issue is routing every booking, including repeat guests who already know the property, through the same commission structure when a direct channel would serve them for a fraction of the cost.
The American Hotel & Lodging Association has pointed to real market concentration: Expedia and Booking Holdings together control roughly 95% of the OTA market, giving a small number of platforms significant leverage over how bookings — and their fees — get structured.