Business Overview

Most travel agencies earn revenue through commissions. Consumers often choose agencies because they help cut down on time needed to research various locations and book accommodations. A popular trend in the industry is online agencies, which operate mostly or exclusively online.

Who is this business right for?

This business is perfect for individuals who are passionate about travel, love learning about and visiting new places, and are very detail oriented. Travel agency owners have very flexible hours but usually only after they have an established book of clients.

What happens during a typical day at a travel agency?

Day-to-day activities of a travel agency owner include checking faxes, phone messages, and incoming emails. You may also meet with clients and book numerous client trips during the day.

What is the target market?

Most clients and customers are people who want to travel to another country. While domestic agencies do exist, the market is really in international travel these days. The types of clients an agency might serve depend entirely on the current market place. Client needs range from simple vacations to corporate retreats to medical tourism.

How does a travel agency make money?

Commissions are the way in which travelling agencies have traditionally made the majority of their income. Airlines and hotels would pay agencies a certain fee for utilizing their companies when booking for a client. However, with the recent proliferation of booking technology, including Google Travel, travelling apps, and company websites, these businesses are more accessible to consumers and no longer rely on travelling agencies to promote their services. For this reason, airlines and hotels have largely stopped paying travel agencies commissions. As a result, travel agencies have been forced to adapt, focusing less on simple bookings and more on navigating complex itineraries and the legalities of travelling in specific regions or countries. They have shifted to charging flat rates for bookings and hourly rates for consulting services related to planning travels and navigating legalities.

What is the growth potential for a travel agency?

Most small travel agencies are started as home-based businesses. Larger agencies adopt a traditional office model. Agencies can be run as a single-owner business or as a multiple-employee organization.