When asking how a travel agent can make money, the obvious and simple answer is that they sell travel! But in this article, we want to expand on what a travel agent can sell instead of focusing on high-level thinking of selling flight tickets or booking hotels. There’s so much more a travel agent can target and sell that the possibilities are almost endless in creating revenue as a travel business.
Commissions
The most important way that a travel agent earns money is by receiving a commission on travel sold. This can include a commission from booking flights, accommodation, tours, car rentals, entertainment tickets, insurance, and so much more. An agent will always earn a commission on selling travel but commission fees can differ based on the supplier they are purchasing from and if they are affiliated with a consortium or host agency, who will take a percentage of the commission as well.
Travel Agents can also earn more commission by selling add-ons such as additional days of travel, tours, and trip insurance. A helpful example to explain what a commission could look like is if a travel agent sold a 5 night, 6-day cruise to a couple traveling. The travel agent would earn the cruise commission but could also earn more if the travelers decide to purchase tours from the cruise line and trip insurance as well. Maybe they end up staying an extra night at the final destination too, which in return will add up in commission for the agent.
Service Fees
In addition to receiving commissions when booking travel, many travel agents will also have a set service fee they charge to all clients. This can look different for all travel agents. An agent might have a service fee they charge (ranging from $100-$250+) for all trips or offer a fee just to help plan the travel.
Pro Tip: Not charging a fee? Check out our article on charging fees here to see if charging a fee is right for you.
Instead of booking all of the travel for a client, travel agents can also charge clients just to do the planning and itinerary building and let the client book travel on their own. Travel agents might charge a flat “planning” fee and then just hand over the travel plans to the client once they are finished and that’s all they will do.
Group Tours
Planning group tours as a travel agent can be a popular money avenue because of the large number of travelers at one time. A lot of travel agents will specialize in group travel whether that is planning family reunions, destination weddings, hobby travel, sports travel, you name it!
As an example, a travel agent might book 50 cabins on a cruise and work on filling each cabin. They might focus on a niche like a certain hobby or event that would help encourage many people to book a cruise at the same time. That way, the agent earns a commission on 50 cabins instead of 1 when a traveler books a one-off trip.
There are a lot of agents who will only do group travel since the value of earning a large income is so high. Some agents may even focus on planning 1-2+ large travel groups a year and earn their yearly revenue just by that alone. The possibilities are truly endless when it comes to group travel which brings us into our next way of making money: Niche Travel. Combining a niche with group travel can be a great way to earn a lot of money from one trip.
Niche Travel
Another popular income source for travel agents is focusing on a niche so that they can create group trips or become a go-to source when a traveler is looking for a particular travel experience. Many agents even have two businesses under one umbrella where they will sell travel to anywhere in the world but also have a side that is dedicated to a niche. As an example, a travel agent might sell a lot of resort packages and cruises but then have a second business just for wine and food travel.
Even though there are hundreds of different niche travel options, here are a few to give you an idea of what niche travel can look like:
- “Surprise” Travel: This has been a growing sensation for many travelers. Surprise Travel is when a travel agent books an entire trip for someone but the traveler doesn’t know where they are going until the day before or when they get to the airport!
- Sports Travel: An agent might rent a charter bus and find 50 people who are interested in traveling to a sports game and book hotels, activities, and transportation for the group.
- Destination Weddings and Honeymoons: If weddings and honeymoons are your jam, this is a great option for you!
- Disney: Many agents focus solely on Disney experiences and these agents live and breathe it. They know all the in’s and out’s of each park and can help customize your trip to fit your families needs.
- Special Needs: Focusing on a demographic can help when choosing a niche. Someone who focuses on special needs travel will be a pro at knowing what to look for when booking, what types of accommodation might need to be made, where to rent equipment, and so much more. For more information on this type of niche, check out our webinar here.
Above are just a few examples but there are so many different niches available and many that haven’t even been thought of yet. If you’re interested in niche travel, ask yourself where your passion lies and see what types of travel experiences can come from that.
Corporate Travel
Focusing on corporate travel is another option for your travel business. Instead of booking leisure travel, some agents will only work with corporate clients. This can be a great option because you will have your main clients and know that you will continuously be booking travel just for them. Booking corporate travel mostly includes booking flights, accommodation, and rental cars but since you know that the quantity is greater, you can end up making great revenue from commissions in return. Corporate travel can also include booking incentive travel or group retreats and events.