The Vrbo Markup is a fee bundled into the rent. This fee allows the property management company to recoup the Vrbo Commission by passing the cost to the guest. This article explains how to set it up and use it properly.

• Reason for a Vrbo Markup
• Set Up the Vrbo Markup
• How the Vrbo Markup Works
• Breaking Down the Vrbo Charges

Recoup the Commission

Vrbo charges the host company a 5% service fee on the booking subtotal for every reservation booked through their platform (when using the pay-per-booking model). Vrbo’s website states, “If you use property management software to manage your listings, you’re charged a 5% booking fee for bookings made through our family of sites.”

So, if you’re charging $100 USD a night for a 3-night stay, plus $60 USD for a cleaning fee, your booking subtotal is $360 USD. The host commission is generally 5% of your booking subtotal ($18.00 USD). Vrbo charges your commissions each month to the credit card you have on file.

BrightSide offers a way for hosts to recoup the 5% fee by passing it on to the guests through the Vrbo Markup.

Create the Fee

The Vrbo Markup is a regular fee, set up in Reservation Fees and Charges. When you finish adding this fee, it should look just like the screenshot below. The only difference you might possibly have is the percentage.

Navigate to: Reservations > Fees and Charges > +Add

1. Name: Vrbo Markup
2. Description: Not needed. It will not show up anywhere.
3. Type: Select “Percentage” from the dropdown menu. The other options do not work properly for the purposes of the Vrbo Markup.
4. Include in Rent: Tick the box. This bundles the fee in the rent instead of listing it as a separate fee on Vrbo.
5. Percentage: Enter the amount you want to want to increase the Vrbo rental rate. NOTE: This raises the rental rate ONLY, and does not affect your fees.  However, the 5% service fee Vrbo charges you is based on the subtotal of your charges, i.e.: the rental fee, cleaning fee, admin fee, and most other fees you may charge. They do not charge the commission on refundable damage deposits or taxes.* In order to have enough of an increase in the rent to cover 5% of “everything,” you need to increase the rent by at least 10%. Do what you are comfortable doing. Be forewarned, if you do not increase it enough, your reservation may show a balance due.
6. Varies by Unit: If you want to charge a different percentage markup for each unit, tick this box. The amount you entered in the percentage field becomes the default markup, but may be changed on a unit by unit basis. This is helpful if you have a property where you don’t want to charge a markup, or if you  just want a higher percentage. After ticking this box, you must go to each unit and enter the desired percentage on the “Rates” tab (for units where you want the percentage to be more or less than the default).
7. Auto Add: DO NOT select this. It will add this fee to every reservation.
8. Refundable: DO NOT select this.
9. Credit to Owner: DO NOT select this unless you want any “leftover” funds from the markup to pass to the owner.
10. Reference Number: Not needed.
11. Taxes: Tick “Use Unit Taxes.”
12. Save

*See Vrbo’s website for exact details for what they charge, or don’t charge, commissions.

Activate the Markup

After you create the Vrbo Markup fee, you need to activate it in Integration Partners. You must follow these steps so the markup can be added to your Vrbo reservations.

Navigate to: Setup > Settings > Integration Partners > Vrbo (tab)

After you navigate to the Vrbo Integration area of BrightSide, scroll down to Online Booking. Just above Blackout Dates you see the Channel Markup Fee. In the dropdown, select Vrbo Markup.

1. Channel Markup Fee: Select “Vrbo Markup”
2. Save

The Vrbo Markup is now active and the specified percentage is added to the rental rates BrightSide sends out to Vrbo.

The Details

The Vrbo Markup is a way to raise the rental rates on Vrbo to pay for the Vrbo Commission, without passing on the increased revenue to the owner. The idea is not to hide rental revenue from the owner, but to recoup the Vrbo Commission by including it in a higher rental rate. Here is how it works.

1. Fees & Charges with the setting “Include in Rent” are bundled into the basic rental rates. The Xplorie fee is a good example of this.
2. The Vrbo Markup is applied and increases the bundled rate by the percentage set there. If your Vrbo Markup is 10%, the bundled rental rate is increased by that amount.
3. BrightSide feeds the bundled rental rate to Vrbo, along with any additional separate fees you charge, i.e.: cleaning fee, admin fee, etc.
4. At the end of the month, Vrbo charges your credit card a 5% commission based on the subtotal. The subtotal includes the rent, cleaning fee, admin fee, and nearly any other fees you charge.
5. BrightSide breaks down the Vrbo Payout to account for all the “bundled rental fees” and other charges in the reservation. These are listed separately in the reservation charges.
6. The Vrbo Markup is retained by the property management company to cover the cost of the Vrbo commissions.

Example

The following is an example of how the Vrbo Markup is applied, creating a new bundled rate for Vrbo reservations. In this example, the property management company offers Xplorie benefits and the cost is included in the rent rather than listing it as a separate fee. If you do not offer Xplorie, or bundle any fees in the rent, the Vrbo Markup applies only to your rental rate.

$100.00 – Rental Rate
+ $15.00 – Xplorie Fee (only added if “Included in Rent”) This fee varies depending on which tickets you offer your guests.
= $115.00 – Rental Rate ($100.00) + Xplorie Fee ($15.00)
+ $11.50 – Vrbo Markup (10%) The Vrbo Markup is the last fee to be added to a bundled rate.
= $126.50 – Rental Rate ($100.00) + Xplorie Fee ($15.00) + Vrbo Markup ($11.50) = Vrbo Bundled Rental Rate

The Details

Unlike Airbnb, you process the payments for Vrbo guests directly, so there is no Vrbo Payout like there is for Airbnb. Any deposit, and other payments made, are recorded in the reservation as they are paid.

While BrightSide bundles some of the fees when sending them to Vrbo (see above), we break down the charges and fees into the following categories in the reservation. The property management company keeps the Vrbo Markup to pay the commissions.

$1,991.13 – Rental Charges
$130.00 – Cleaning Fee
$159.29 – Vrbo Markup
$274.18 – Taxes
$2,554.60 – Total Charges

In this example, the Vrbo commission is $114.02, or 5% of 2,280.42 (subtotal before taxes). The $159.29 Vrbo Markup is enough to pay the commission and have $45.27 left over. You can choose to keep this or pass it on to the owner.