Want to start your own travel agency?

If you have a passion for travel and are considering career options, you may be inspired to work in the travel industry. One option would be to set up your own business as an independent travel agent. There’s a lot to consider, so here’s our guide to setting up your own travel agency.

Do I need a travel agent licence?

No. In 2014, the Travel Agent Repeal Bill 2014 was passed, which removed the outdated licensing program which governed Australian travel agents. With regulatory barriers removed, a new breed of ‘hybrid’ travel agents emerged, operating online with a strong social media presence while providing a personalised, ‘concierge-style’ service.

Many of these new travel agencies have been founded by ex-travellers; people like you, who want to share their knowledge and help other travellers make informed choices, get a great deal and have the trip of a lifetime!

In addition to changes in the law, travel technology solutions are now more readily available, removing many of the administrative and financial burdens of running a small travel agency.

Product Knowledge

True travel agents (not just salespeople) are passionate about travel. They have an extensive understanding of the products they promote and sell, and have experienced many of these products first hand. Travel agents provide added-value to their customers by offering impartial advice, to help their customers arrange the trip that’s best-suited to their taste, desires, personality, expectations and their budget. True travel agents offer a degree of peace of mind, and will act as a conduit between the customer and the supplier, before, during and after the trip as required – even when things go wrong!

Being a great travel agent isn’t easy, and to be successful you need to extensive product knowledge. Here are a few ways you can obtain it:

  • Famils (Familiarisation Trips). Many suppliers will be willing to offer you discounted (and potentially free) trips, if you have a solid business plan and can prove you got what it takes to generate sales.
  • Speak with other travellers. Get the low-down on what’s hot right now, and don’t just take a few a few opinions on board – get hundreds. Canvas hostels all over town and survey other travellers about where they’ve been and what they’ve experienced.
  • Talk to other travel agents. Travel agents are generally a friendly bunch, and many would be happy to offer you tips and guidance on how to succeed in the travel industry.
  • Get valuable work experience. There are hundreds of travel agencies across Australia who are desperate for smart, savvy and motivated travel sales staff. Be upfront and tell potential employers that you’re keen to work in the industry to learn as much as you can, as you would like a career in travel. Who knows, you make strike it lucky, and be offered a great job and may kick-start your travel agency career that way. (Get in touch with Hero if you’d like to explore this option, and we’ll hook you up with some awesome Agents across Australia)

Other necessary skills

In addition to having extensive product knowledge (which will develop over time) you’re also going to need:

  • Great communication skills
  • Patience
  • Attention to detail
  • Organisational skills and the ability to multi-task
  • Good maths & finance skills
  • Decent IT skills

What’s your sales strategy?

There are many different ways that you can go about selling travel:

At the most basic level, you may just want to arrange travel for friends that you meet whilst travelling. You can spread the word face-to-face, receive enquiries through social media and keep your costs to a minimum while providing a truly personal approach and travel at great rates. (Just be sure not to sell travel within hostels that operate their own tour desks, as that ain’t cool).

You may wish to sell online, via your blog, a website or through social media channels like Facebook. For this option you may want to create a basic website, so check out Wix, Squarespace, Weebly and WordPress, which offer easy-to-use CMS options, enabling you to build a new website with simple drag & drop functionality. Post products and special offers to generate enquiries or check out Hero’s Web Widgets, enabling you to easily sell ‘live’ online – take a look here.

If you have experience with travel sales and some money to invest in your venture, you may be keen to open a small travel shop or rent a desk space in a hostel / language school which does not currently offers travel sales. This is a big step, but if low-risk rental terms can be agreed, it provides maximum exposure to a steady flow of potential customers.

Alternatively, a great way to kick-start your business is to align with an existing travel agency, and structure a partnership arrangement whereby you operate under their brand, benefit from their support services, and pay a fee / or a commission share back to the agent. This option enables you to get up and running quickly and you’ll have experienced travel agents and successful business-owners helping you out along the way…  Your success, is their success! ; )  If you think this option is something you want to pursue, contact the team at Hero and we’ll put you in touch with other Hero agents who may be keen to discuss opportunities with you.

What’s your point of difference?

The travel industry is a crowded market, so to stand out from your competitors you’ll need to decide what makes you better than the rest. Some possible unique selling points could include:

  • Honest & unbiased travel advice
  • Exceptional customer service
  • Premium / unique / specialised product range
  • Great value / pricing policy
  • Comprehensive after sales support
  • Ethical mandate, i.e supporting local charities

How will you purchase?

In order to act as a travel agent, you need the ability to purchase travel from a supplier and resell at a profit to your customer. In travel industry lingo, your purchase price is known as the ‘net rate’ and the amount you sell for is known as the ‘gross’ or ‘retail rate’. Your profit margin or mark-up is generally referred to as your ‘commission’.

In order to establish these sales relationships, you can either contact each supplier individually or book via an online B2B travel sales platform, such as Hero. B2B systems offer instant access to thousands of products, including day trips, multi-day tours, accommodation, bus & rail, campervan & car hire. Net rates, retail rates and commissions are already loaded into the platform, so it’s easy to see what you can earn and plan your budget accordingly.

Paying your suppliers

If you choose to purchase directly from your suppliers, you will need to agree to their payment terms. Often, for new agents, payment will be required at the time of purchase via credit card, or if credit terms are agreed, you will be required to pay the net amount in full within 7, 14 or 30 days from the sale date.

In some instances, suppliers may offer agents a deposit-only payment model, whereby the customer pays you the commission amount, and then pay the supplier the balance (net amount) upon arrival. This is an incredibly simple model, but customers may be reluctant to pay a ‘deposit’ to a small travel agent, for fear that it may be a scam. Likewise, suppliers often prefer that customers have pre-paid in full, ensuring they’re not subject to losses should the passenger ‘no-show’.

For a more systematic option, by using a B2B platform such as Hero, your payments to suppliers will be aggregated into 1 simple weekly direct debit payment. The platform will then distribute payments electronically to each of your suppliers. This alleviates administration, finance and management burdens, allowing you to operate without the stress.

Issuing Tickets

Once you’ve sold a trip, your customers will need a ticket or travel voucher.

You can create your own vouchers, although this is not recommended, as you will be prone to human error resulting in the wrong / missing information being provided to your customers.

You can ask suppliers to email a booking confirmation directly to your customers, although there’s a strong chance that your net rate / commission amount may be accidentally shown on the booking confirmation, leading to very unhappy customers.

If using a booking platform such as Hero, vouchers will be automatically generated and can be easily downloaded, printed or emailed to your customers.

Taking payments

Taking payments from your customers can be a tricky affair, as people will need a level of confidence that funds won’t ‘disappear’.

If selling travel to close friends and after building up a strong reputation, this may become less of an issue, and customers may be happy to pay you in cash, or transfer money to your bank account.

Payment solutions such as PayPal may enable you to ‘request’ funds via email, rather than taking cash payments. Visit Paypal’s website to figure out if this is right for you and how much it will cost you in fees.

Alternatively, platforms like Hero offer the use of their own merchant facilities, enabling you to take payments by credit card, or by emailing a payment link to your customers, allowing them to pay online. Again, fees will be incurred for each credit card payment, but you can choose to absorb these yourself (out of your commission) or your customers can pay a credit card fee, to cover associated costs.

Promoting yourself

To start your own travel agency and be successful you’ll need a smart marketing & promotional strategy, to ensure your sales messages reach potential customers. There are countless opportunities available, however some of the most popular include:

  • Start a Facebook Group and build a following
  • PPC (pay-per-click) advertising with Google AdWords, Facebook Ads & Facebook Promoted Posts
  • YouTube & video content
  • Great website content and organic SEO
  • Old school printed marketing material – such as business cards / brochures

Name your business

Depending upon how you plan to brand yourself, you may want to choose a business name, or simply stick to your own name, for that personal touch!

If you have a business name in mind, visit the ASIC website to see if the name is currently unused, and available for you to register.

Registering your business name relatively easily. ASIC’s website is packed with handy videos and guides to help you get the name you want.

Register an ABN

In order to look professional and keep the tax man happy, you’re going to need an Australian Business Number, or ABN. It’s free to apply for an ABN and the process can be completed easily online via the ABR website.

Open a bank account

Once your business name and ABN are sorted, you’ll need to open a company bank account. Speak with your local branch or call your bank’s small business helpline to see what’s best for you.

Get Insured

Be sure to speak with a specialist insurance provider to find out what cover you will require. We highly recommend Allsop Bunting Insurance.

The Hero travel booking platform is designed for travel agents of all sizes. If you’re keen to start your own travel agency, contact us and we’ll do our best to provide you with additional help and information.