If you have a love for travel and an inkling to start your own business, opening a travel agency may be just what you're looking for. There are several ways you can go about setting up and running a travel agency. It may be the career move you've been looking to make--combining your love for travel with your need to earn an income.
Start-up Costs to Consider
You can either start a travel agency as a home-based business or choose to establish an office in a building or shopping center. Where you choose to open your travel agency office will have an effect on how much money you need to start the business. In order to keep costs to a minimum, a home-based travel agency only requires you to have a phone and a computer in order to start booking travel and making money. If you choose to establish an office, you'll have additional costs such as rent, furniture and electricity.
For example, if you choose to rent a small retail spot, it can cost you a couple thousand dollars in rent, and then there are the added costs of furnishing the office--hundreds if not thousands of additional dollars. With a home office, you can use what you have as far as furniture and a computer is concerned, so your cost for a phone line and Internet access will run you far less than renting an office.
Travel agency owners do more than book airline tickets, hotel rooms and cruises. Additional services that travel agencies provide include helping travelers obtain travel visas and passports, arranging transportation from the airport to the hotel, conducting research for group and company retreats, business meetings, conferences and trade shows. Some travel agencies even partake in event planning services for special events such as weddings and corporate events and provide total travel budget management for companies to keep their costs to a minimum.
There are two main target markets for a travel agency. One market is consumers that travel, which can be virtually any individual. Since travel agents can work with anyone in the world to book travel, it's not necessary to limit your sights on your local market. With access to the Internet, your services can be helpful across the globe.
The second main market that travel agencies provide services to is the business or corporate market. Larger companies can be lucrative because they tend to have more travel needs. This, however, does not eliminate the need for your services in small companies that may not have the staff necessary to handle booking business travel and accommodations.
Other travel agents start out with an already established agency to learn the ropes and build a book of clients. Once they get the hang of the business and have a decent amount of repeat customers, they can then branch out on their own and open their own travel agency.
Travel agent commissions are derived from two sources. One source is from the fees charged to clients that are booking travel. The larger the volume of business, the better your commission, and by focusing on higher-end products, you can also increase your income potential. Most travel agents earn anywhere from 10 to 15 percent of the net cost of the services sold. Cruise businesses pay anywhere from 18 to 20 percent to travel agents for bookings.
The average earnings for a travel agent really runs the full spectrum. Since it is a job based on performance, you really have control over the amount of money you can earn, but agents report earnings anywhere from $17,180 to more than $44,090 per year. This doesn't mean, however, that there aren't agents earning six figures. "Travel Weekly" magazine reported that home-based travel agents earn more than $100,000 a year.