Last updated on April 27th, 2020
Are you planning to start a travel agency? If yes, you should be ready to meet all the important aspects of running the agency successfully. Right from finding the perfect location to getting legal permission and approaching the partners, there are some crucial steps to take.
Travel agencies make travelling much easier for customers by eliminating all hassles attached to purchasing of tickets, picking the affordable packages etc. In recent times, people are using online platforms to search travel related information and buy tickets and packages. This had given a jolt to the offline travel agents and their businesses had slowed down.
But, the digital travel sales have increased. In the United States, digital travel sales have increased to $ 180 billion, which was expected to exceed 213 billion by 2020. The travel market is flooded with online travel agencies, including Expedia and Priceline group, which have showed that the future of online travel agencies is bright.
But there is still a wide scope for conventional travel agents who earned their commission by working in the field. A survey found that in 2015, a majority of travel agents, around 60 per cent of all the agents, had reported a growth in sales.
Whether you are setting up an online travel agency or a conventional offline agency, you need to follow some basics. Remember that your new agency has many new and established similar businesses as competitors. You should also take note that people generally prefer the older agencies. So, it would be a tough job for your agency to get noticed in the market. These basics will help your new agency run its business successfully.
Here Are 13 Easy Steps On How To Start A Travel Agency
01. Find Your Niche
First of all, you should find out your niche market which is an important aspect. One of the mistakes many new travel agency business owners make is they want to sell everything. In that way, they are inviting hard competition from everywhere. That is not a wise thing to do for a startup as it may be lacking in experience and resources.
So, find out your niche travel market. When you pinpoint a particular segment of the market, you reduce the competition since not many operators are active in it. A niche market is the one that very few have explored thus far. There is always a good potential for growth in it.
What could be a niche for a travel agency? To find it out, you need to do a comprehensive research. Know what the emerging new travel needs are that very few agencies are able to meet. As very few competitors are active in that niche, your agency can grow fast.
For example, if you research the market, you may come to know that some newly married couples prefer going backpacking. They do not want to spend their honeymoon days in a conventional and relaxing way. Instead, they look for adventure destinations. If you find that not many travel agencies are providing special travel packages to such couples, you can start doing so. That may be your niche. But do an extensive research.
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02. Make An Effective Business Plan
An effective business plan keeps you on the right track. It guides you in your endeavor to run the agency successfully. But the business plan is not about setting the goals randomly and having a rough idea of what you will be doing. It is much more than that. You should, in fact, prepare a detailed plan.
Your business plan must include some key points. It should be based on your market analysis and sales strategies. Make sure to mention your funding requirements and financial projections. Your business description should be precise in the plan to you have a clear picture of your business goals.
Consider including some other points too. The plan must state the resources available to you to start a travel agency. Do not forget to determine your goals and objective of the business. At the same time, you should identify any constraints that you might face in operating the company. The plan should mention your strategy to remove the hurdles.
03. Do Some Branding Exercise
Branding is important for all types of businesses including your travel agency. Branding is all about creating a perception of your company and the products or services it sells.
One of the effective ways to build a positive perception is to create high-quality visuals such as an impressive logo design. Design other items such as brochures, business cards etc. Make sure that colors and typefaces in all the visuals are the same for brand consistency. If you are able to convey your brand message successfully through these items, customers will think positively about your services.
04. Cover All The Legal Aspects
Your travel agency must fulfill the legal requirements. However, in the U.S the licensing process for travel agents is easy. You are not supposed to undergo any training, testing or qualification process. All you are required to do is to fill a simple form as far as the federal laws are concerned. But the state governments of California, Florida, Washington, and Hawaii have their own set of laws that you must abide by when you start a travel agency.
Therefore, you should thoroughly research the laws for travel agencies in your state. An easier way to find out these laws is to contact a host agency which will let you know about the registration process and the licensing. You will also be required to apply for a Federal Tax ID number.
Another thing to note here is that you must obtain a trademark for your business. Your logo is the trademark of your agency. But, after you create a logo, get it legally registered with the concerned authority.
05. Acquire Funds
When setting up an online travel agency, make sure that you have a funding strategy in place. You may be starting the agency on a small scale or from home; still, it needs a constant flow of money to meet various expenses. If you want to work from home, probably your family members can support.
But if you need a proper office and staff as well as online and offline marketing, you may be applying for a bank loan. Remember that you will need a lot of funds for marketing and create different promotional material. For example, businesses need professional website designs, which require dedicated funds.
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06. Pick Right Location
The success of your agency will depend a lot on its location. Here, one of the key things to consider is the foot traffic. Choose a location where people gather frequently and your signboard is visible to the crowds from a good distance.
People get a good impression of a business if it is located in a nice area that has facilities such as car parking.
If you cannot afford an expensive location, settle for the next best convenient location. Remember that if your agency is at a good site, it is helpful in building a trustworthy brand image of a business. Additionally, your office should be big enough to accommodate your growing numbers of employees. It should be suitable for future expansion.
07. Promote Your Travel Agency
One of the conditions for growth of a business is that it is promoted aggressively across different platforms. Since not many people know your new agency very well, you need to launch an aggressive promotion campaign to target customers. They should know that your little company exists.
Consider all means of marketing and advertisements for making people aware of your agency. You can start giving ads in local newspapers, either use display advertising platform or distribute leaflets to people. Keep brochures about your business in your office so that clients can pick them up easily. You should set aside a budget for online and offline advertisements at the local level.
You should create a lot of marketing materials such as brochures etc. It would be good that you get the services of a professional graphic designer. The designer understands how to use colors etc. elements to convey a brand message of your travel agency.
08. Put Your Agency On Social Channels
Modern day businesses need to build a good presence on different social channels. This is because most people have social media accounts on channels such as Twitter and Facebook to exchange their thoughts on an issue. Your agency can find potential clients or customers on these channels.
First of all, create your dedicated social media page for different channels. Make sure that the page design looks unique and impressive. It should stand out from the pages of your business rivals. Then, post content regarding your travel business regularly. Inform people about the latest price cuttings from our agency or any other feature you added for the customers.
09. Focus On Building Customer Relationship
No business can thrive without paying attention without building a rapport with customers. Your travel agency must take steps to build up relationships with various individual customers who have used your agency or are likely to use in near future. Make sure that you train your staff on how to treat your guests while they are enjoying their vacations. Your local cooks, tour guides, and drivers all staff should be aware of the value of treating your customers well.
Make sure that you train your staff on how to treat your guests while they are enjoying their vacations. Your local cooks, tour guides, and drivers all staff should be aware of the value of treating your customers well.
If customers come with complaints offline or on your website, address them and resolve their issues right away. To build a solid customer relationship, you should create videos to answer your customers’ travel related queries and send emails to them. In fact, you will need many graphic design ideas to create materials that help you to be in touch with customers.
10. Get Partners
You simply can’t run a travel agency without having something to sell. After all, you need to sell tickets, packages etc things to the potential travelers. Where do you get these from? Obviously, you will have to approach a few established travel companies for the permission to sell their packages from your agency. You need to sell their attractive offers to make money.
But to get their nod is not easy. The well-established operators will ask many questions about your startup travel agency. Most importantly, they would like to know what percentage commission your agency will charge. Therefore, have a competitive percentage in mind.
Remember that your new agency may not be in a position to demand an outrageous commission. Consider also that you need the big operator more than they require you. Surely, in the early phase of your business, keep your commission and other demands low.
Another point to mention here is that you should be able to earn the respect and trust of your partners. Once the big travel companies have faith in your ability to sell, they may consider your demand for a better commission.
First, build your brand image by earning your partner’s’ trust. Maintain a good reputation of your agency by resolving the travel related issues of your customers. You should also think of building partnerships with agencies who offer online graphic design services. You will need their services to create marketing materials regularly.
11. Optimize Your Online Business
Your online travel agency must be visible to the potential customers when they type keywords to find similar agencies on the web. This is called search engine optimization of a website. If the site does not appear on the top search results, most customers will not bother to find more sites. They will simply click on the top ranking sites.
Therefore, optimize your travel website so that it ranks higher. However, a first requisite for optimization is that your website design is perfect. This means that the site should have keywords inserted at the right places in your web content. Make a strong content marketing strategy that will help you build your audience.
12. Set Practical Goals
Many travel agents set high goals in their enthusiasm for making huge money instantly. But most of them end up achieving very little of the set goals. This leads to building up of frustration.
Experts suggest that the agents should set realistic sales target and keep it lower when they start a travel agency. First, consider your expenses, costs, expenses, and personal salary. After setting aside this amount, any money you get additionally will be your earnings from sales. So, find out your sales target.
13. Sales Opportunities
Some agents have this tendency of waiting for the sales opportunities. These are the agents who do not want to come out of their comfort zone. They wait for the conditions to improve and ultimately miss their sales goals by a long margin.
Rather than waiting for the clients to enter your agency’s door, a better way is to approach them. You should be doing everything to contact your potential clients. Whenever you get the opportunity, seize it with both hands.
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When you start a travel agency, you need to take care of its lot of aspects. Know your niche, prepare a business plan, acquire funds, find out a nice location, and build customer relationship and other things along with legal permission.