July 10, 2024

How to Start a Travel Agency

How to Start a Travel Agency

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If you love to travel, are highly organized and enjoy working directly with people, becoming a travel agent is an awesome career choice.

You’d think with the ease of using search engines on the internet, the travel business wouldn’t be thriving. But it is.

According to statistics, a person may spend (waste) 20 hours on internet research before booking a flight. The internet is clogged with info, which is why the benefits of using a travel agent will always be of value to the majority of travelers.

What is a Travel Agency Business?

A travel agency is a company that provides travel and tourism booking services and planning for people. This can include making arrangements for things such as air travel, vehicle rental, hotels/lodging and travel insurance. Before you get started find out how do travel agents make money and see if you can find out new ways to generate income.

How Much Does It Cost to Start a Travel Agency?

Great news! You don’t need special training and/or certifications to get started – although you should complete training and certification early in your career. Many travel agents have only completed their high school diploma before starting travel agency work.

Why wait to get the training and certifications? Once you officially register your business and begin to operate, the costs of training and certifications can become tax deductions.

You can gain knowledge by working part-time for successful travel agencies, or you can begin by starting a travel agency. The cost will vary obviously depending on whether you start a home based travel agency or lease office space.

At a minimum, you’ll need a dedicated, high-speed internet business line and basic office equipment such as computers, software and printers.

How Much Can You Make Owning a Travel Agency?

The average salary for someone working for an established agency is $19 per hour. The average annual earnings for independent travel agents is $36,000. That varies depending on your geographical location and the type of travel business you’ve chosen as a specialty.

18 Important Steps to Start Your Own Travel Business

Here are key steps to take to get your start in the travel industry. You should decide early whether you want to work for a travel company or work on starting a travel agency.

1. Complete Relevant Training

Colleges and business schools offer associate and four-year degrees in tourism. There are some independent educators such as The Travel Institute which offer certifications.

All these studies will include courses in business management, marketing, accounting and customer service. As part of ongoing education, you should also keep tabs on international affairs and weather events.

2. Look at the Competition

Agencies in the travel industry typically offer all types of services but specialize in a certain niche. For example, some travel agencies focus on luxury travel, some focus on the adventure travel industry.

Savvy travel agents know their competition well, especially before starting their own business.

3. Choose Between Host Agency, Independent Travel Agent, and Franchise

Under the umbrella of a host agencies, you can work as an hourly or salaried employee. In addition to your regular pay, you may be eligible to earn commissions.

If you’re starting a travel agency, you’ll be working independently. Your source of pay will be the fees you charge clients plus commissions you earn from travel suppliers – such as airlines, hotels and rental vehicle companies. Some businesses function solely as online travel agencies – those often focus on arranging corporate travel.

You can also opt to purchase a franchise, such as Dream Vacations. A franchise will provide training programs. Both a host agency and a franchise have the advantage of existing vendor partnerships.

4. Find a Specific Niche and Target Market

Maybe your idea of a dream vacation is renting bicycles and traveling Inn to Inn in New England. Or you might prefer canoe wilderness rivers, staying in tents.

Maybe you’d like to book an all-inclusive trip, where the price includes airfare, lodging, food and beverages.

Your preferences aren’t what’s most important. You need to think about your potential clients and customers. Learn the demographics of your local community area and the average income of potential customers.

5. Choose a Business Name and Register Your Travel Agency

Before you lock in on the name, go to the website for your secretary of state. That’s where businesses are registered. You can check to make sure the name you’d like to use isn’t similar or the same as a travel agency already in existence, before you spend money on business cards or a website.

6. Write a Travel Agency Business Plan

Here are some helpful tips for making your business plan. A business plan should include key elements of a business plan for travel companies:

New business name and website

Business physical location

Business Structure

Niche in the industry

Forming partnerships (cruise lines, hotels, rental companies, etc.), especially once you’ve been a travel professional for over a year.

Plans for marketing/expansion in the industry.

7.Open a Business Bank Account

Open a business bank account and get a business account credit card.

8. Make Sure You Have the Licenses and Permits Required in Your State

General Business License as required by your business location.

Travel Agents License – If required by your state.

Federal employer identification number (EIN) – needed for paying business taxes and payroll taxes, if you have employees. You’ll need the EIN when you file taxes.

Zoning – If you’re working from a home office, you must make sure your residence meets the zoning requirements for home based travel agents.

9. Create a Travel Agency Website and Choose a Location

You may start your own travel agency with the glitziest, most informative and gorgeous website imaginable.

But its use will fail if it hasn’t been correctly linked – called search engine optimization. Unless you’re very savvy about this, it will pay you to hire a professional to make sure clients find your new company and social media accounts. That’s a key part of your marketing strategy.

10. Sort Out Your Accounting Software

You’ll need to manage travel contracts, travel bookings, invoices and receipts, vendors and more on the financial end. Here are some of our recommendations:


Fresh Books


11. Choose a Business Structure

You’ll need to choose a structure for starting your travel agency. Many travel agencies choose the Limited Liability Company, or LLC. The LLC allows you to protect your personal assets, especially if you’re operating in your own home.

Other common structures chosen by many businesses in most states include partnerships and corporations.

12. Get Your Taxes in Order

Basic needs: An EIN, accounting software to track deductions/expenditures and payments.

13. Purchase Business Insurance

There are common insurances needed, such as BOP (business operator’s), professional liability, commercial liability, errors and omissions, and general liability insurance.

If you’re going to sell travel, you need to offer travel insurance. What if travel restrictions suddenly impact a location? What if a natural disaster destroys the plans for a beach wedding destination?

14. Join Travel Associations

Here are a few which will serve as additional resources for you (help you with finding customers):

US Travel

American Society of Travel Advisors

Association of Independent Tour Operators

15. Set Up Your Office and Invest in Equipment

You’ll need typical office equipment such as computers, software, internet, phone system and fax. If you’re offering travel services face-to-face, you’ll need comfortable furniture and a conference room, as well as ample parking.

16. Marketing

What do other agents do to earn more money? Read and go to seminars.

Learn all you can about the best ways to market your business and earn money comparable to top wages.

17. Find Partners

Partners can include elements of a destination – a motel, B&B, restaurants or spas, for example.

A partner can also be a media company, such as a newspaper, radio or television station. You buy advertising with them and negotiate a reduced-price trip for an owner or manager.

18. Build Trust with Your Customers

You’ll build trust by being easily reachable and quickly responsive to any issues that arrive. For example, a customer has picked up baggage at the airport, but been told by the rental vehicle agency that there’s no reservation. What are you going to do about that?

Your response to such issues will build your reputation. Word of mouth is the best advertising your new travel agency can get.

How to Compete with Big Brands in the Travel Industry

To run a successful travel agency, you’ll have to accept that you can’t go toe-to-toe with the big ones. Instead, create your niche – a type of travel or destination that isn’t common in your area.

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