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What Do Travel Agents Make – “How do travel agents make money?” This is a question I hear often. Usually, the people who ask are either people who are interested in becoming a travel agent or people who know that I work in the travel industry and can’t believe that travel agents are still around! (Um, they’re the new darlings of today’s hungry, information-laden travelers!)
I’ll go deeper in a second, and here’s a list of steps that show how travel consultants make money:
What Do Travel Agents Make
Now, if you’re looking for what travel agency agents earn, go further into the salary range of travel agents. You are on the right site, just the wrong article. 🙂 Here’s our article that dives deeper into travel agent salaries.
The Hosted Travel Agent Income Report, 2019 [+infographic]
To give you an answer about how travel agents make money, it’s worth knowing a little history. I promise to cut it short, it’s really fascinating how the industry has changed over the years.
In the good old days, a large portion of travel agency revenue came from airline commissions. Since tickets were expensive and in demand, only agents or airlines could get tickets, they were the bread and butter of each agency.
They were travel agents in every sense because they were travel agents. Their income comes from the sales of tourism products. However, in the 1990s when airline commissions were cut and patched – sad face! – Travel agents’ main revenue base has disappeared. It hurts. A lot.
Airlines have cut commissions because they can now reach travelers online and through online travel agencies (OTAs) like Expedia and Booking.com. Travel agents who were previously booed by airlines are left out in the cold. Ouch.
How Much Money Do Travel Agents Make? (2019)
With the rapidly changing travel landscape, travel agents need to find new ways to make money. . . and fast. This is our current “How Do Travel Agents Make Money?” Our story. begins.
With reduced commissions and the ability for customers to book online, agencies must adapt to the new landscape of travel and booking travel. The travel agency community is quite frankly devastated by this. Many institutions that failed to adapt were forced to close their doors.
OK, OK. Before I whip out a whole box of tissues, I want to assure you that the afterlife will be much happier. Stay with me. 🙂 Although smaller than in the glory days, the travel agent community has found a balance.
Since 2013, travel agents have started to see their numbers increase. While earlier retirees were concerned about the lack of travel agents to fill the shoes, an influx of new blood was eager to take advantage of the flexibility and travel opportunities offered by the travel agent industry.
Do Travel Agents Save You Money?
Did you catch it?!? We went from 70% of our workforce over 55 in 2013 to 50% of our workforce under 55 in 2022! Although ASTA and HAR tend to appeal to different demographics—ASTA is traditionally larger, retail stores and HAR is typically smaller, out-of-store agencies—the trends are clear. Travel agents are no longer at risk of extinction. (HUZZAH!!!)
Is this a big reason for the new trend? The Rise of the Remote Agent. Call them whatever hip term you want to use / home based / location independent. It may be harder to see them without a store, but this new segment of the industry is now a force to be reckoned with!
In general, the most popular agency model has changed from the store agents of yesteryear to today’s remote agencies.
Think it’s too good to be true? Read the professional profile of a travel agent with the data to back it up!
Benefits Of Working With A Travel Agent
Along with the loss of airline agents, travel agents are also challenged by non-routine charges (NCF) of many major travel lines. Yup, it’s self-explanatory: they’re all kinds of fees that can’t be used. A cruise ship might cost $2,000, but only $1, $400 is available. The kicker is that a consultant can still spend a lot of elbow grease ordering these NCFs for their clients.
The travel agency business model (both corporate and leisure) has become dependent on commission alone. Why change? Not only are commissions from airlines and other vendors lower than ever, but the industry has seen tremendous industry and economic ups and downs such as 9/11, the recession and the flu. (Anyone missing? PHEW, travel agents sure are tough!)
Commission income has been on a rollercoaster ride during this time. During the coronavirus pandemic, advisers canceled overtime, bent over backwards to keep their clients safe at home, took time to comply with ever-changing travel regulations and rebooked tours despite commissions. to stop. That’s right, they were working overtime without pay. These key pitfalls have helped advisors realize the importance of diversifying their income streams to stabilize their income.
So how do travel agents make money in a world of low (and sometimes unpredictable) commissions? One strategy for advisors to combat declining commissions is to diversify their income through fees. This has helped agencies move away from full reliance on dealer committees and push their bottom lines, which were previously cushioned by generous airlines and dealer committees.
The Top Content Mistakes Travel Agents Make & How To Fix Them By Social Takeoff With Kelli Hayes Smith
Okay, before we really dig into things, it’s important to understand that different travel agencies make money in different ways.
To make it easier, we’ve broken down how travel agents make money into the 4 main travel agencies: corporate, leisure, custom and the ‘big players’.
How do corporate travel agencies make money? Corporate travel agencies earn money primarily from service fees, net/private tickets and line commissions.
Airline tickets are the lifeblood of corporate entities (also known as TMCs or travel management companies). Are TMCs going to stop selling air tickets just because the airlines have stopped flying? There is no way. They had to get creative to make up for the low commission. What did these corporate bodies do? They apply a service charge when booking tickets.
What Services Do Travel Agents Provide In Adelaide & Melbourne?
In addition to aviation, corporate travel agencies generate income by booking cars and hotels for tourists. Corporate travel agencies earn money primarily from service fees, net/private tickets and line commissions.
The average service fee for airline tickets in 2022 was $39 for domestic air and $63 for international air for corporate travel booking agents.
Travel agents can earn on domestic air (typically 0-5%) and international air (about 10-22%), depending on the airline contracts they can secure.
So how much do corporate travel agencies charge? According to the 2022 Travel Agent Fee Report, the average service fee for airline tickets in 2022 was $39 for domestic air and $63 for international air for agents booking corporate travel.
Ways Travel Agents Can Make Money In 2022
Airlines Read more about airline ticket types here. Looking to break into corporate travel? 3 Read how corporate agents got into the industry.
After the commission cut, many travel agencies moved to sell high-ticket products that still pay travel agents. These products were mainly vacation packages and cruises. Now, these are your leisure travel agencies (which you probably think of when you think of a travel agent).
Generally, the main revenue of leisure travel agencies comes from commissions paid by sellers on vacation packages, cruises, air and other ancillary fees. However, as agencies try to diversify their revenue sources and become less dependent on provider commissions, consulting fees and service fees are becoming more common.
If you’re wondering how much money a travel agent can make through fees, check out HAR’s full fee profile here!
Travel Agent Because Badass Miracle Worker Isn’t An Official Job Title: White Lined Journal Soft Cover Notebook For Travel Agents: Press, Happy Cricket: 9781097230792: Books
In 2022, 53% of advisors reported fee-based. Compared to earlier days, only 33% of consultants were paid in 2017. Holy smokes, that’s a big increase
Fees help agents boost their bottom line and compensate them for their expertise. When an agent is hesitant to charge, some agents implement “book look” fees or “fee plans.” This is an up-front fee for the study, which is used to order when the order is placed. Other agencies charge a direct non-refundable fee for consultations.
Airfare service fees are usually the most common among advisors. Looking at non-airline fares, these services are in the top 5 for consultant fees:
Learn from an agent who earns 80% of their income. (No, it’s not a typo!)
Host Travel Agencies And The Opportunities They Offer
Mass market tours such as cruises, all-inclusive resorts or European bus tours are not for everyone. When travelers want an itinerary made just for you, travel agents call it an F-I-T tour—which, frankly, is what you call a custom itinerary. But why be so simple when you come up short, right?! 😉
Custom itineraries are more common and include bookings where travel agents do not pay a fee. Agents who set up FITs typically charge higher consulting, travel planning and/or service fees.
FIT travel agents do not make money
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