How much commission do travel agents make

how much commission do travel agents make

BECOME A TRAVEL AGENT

Do you want to become a travel agent but don’t know where to start? If you’ve already done some research you probably discovered that there are as many ways to become a travel agent as there are people selling travel agent training packages and travel agent business opportunities. We do not sell any travel agent training packages or travel agent business opportunities and therefore we hope we can provide some unbiased information and good recommendations.

In this section we will start by providing some background information on the travel agent industry to put things in perspective. We will then identify the different types of travel agents based on their training, types of travel products they sell and office locations. Finally, we will outline what we believe to be the best way to become a professional travel agent with the highest probability of success. Along the way we will introduce you to various travel industry organizations with links for additional research. We also have one of the most complete list of travel agent training schools.

As with most other careers, a successful travel agent career is dependent on a good education. Anybody that tells you that you can become a travel agent without a good up-front travel agent training is lying to you. They are probably trying to sell you something and are only concerned about getting your money. Please be very careful and do your research before you make a decision.

IS THIS A JOB FOR YOU?

The travel industry today is a very exciting and vibrant industry, constantly changing with the latest technology. For some people this can be very intimidating and down right scary. For others it is just an opportunity. In order to succeed as a travel agent, you must be flexible, adapting to the latest technologies and trends.

To succeed as a travel agent, you must also have an outgoing personality, a passion for travel, and a strong desire to share that passion with others. When customers come to you, they may not always know exactly what they want. It is up to you to use your knowledge and experience to quickly analyze your customers’ wants and needs and put together a vacation package that exceeds their expectations and they will never forget.

However, being a travel agent is not for everyone. It requires a lot of hard tedious work. You have to interact with all kinds of people and always be friendly, courteous and treat people with respect.

The travel industry is also very competitive. It is part of the reason for the rise in home-based travel agents. Working from home keeps the overall cost low allowing you to more effectively compete with online travel agencies and suppliers that have their own online booking engines. Ultimately, the service you provide will distinguish you from all the online booking engines and keep customers coming back.

So analyze yourself, and be honest. Is this what you really want to do? If yes, then continue reading, the travel industry may very well be for you.

HISTORICAL BACKGROUND

Travel agent jobs, along with the travel industry, have changed quite a bit over the years. It used to be that travel agents went through a travel agent training program and then worked in a storefront travel agency booking mostly air/car/hotel packages. The reservations were made via a computerized reservation system using short cut commands. This was usually a full time job during business hours. The customers either walked into the office or called in.

Four events in recent years significantly changed the travel industry:

The emergence and growth of the cruise industry and CLIA (Cruise Lines International Association). The CLIA certification and training programs created a new category of travel agents specializing only in cruises.

A significant increase in the number of tour and vacation companies that put together vacation packages that include air/car/hotel as well as sight seeing excursions and special activities. These vacation packages are usually cheaper than separate air/car/hotel bookings and do not require the use of the traditional computerized reservation systems. Today you can find vacation packages for just about any type of vacation anywhere in the world.

The internet along with reliable high-speed internet connections and powerful web based applications made it possible for travel agents working from home to provide the same level of service as those in a storefront office.

The tragic events of 9/11 helped to accelerate the changes that were already in process within the travel industry. For decades before 9/11, the travel industry consisted primarily of storefront agencies doing business as usual. However, in the late 1990s the industry was beginning to feel the pressures of the Internet and direct online bookings. The significant slow down in travel after 9/11 and elimination of airline commissions forced many of the traditional travel agencies out of business. The travel agencies that survived had to adapt to the new business conditions by selling more high commission leisure products such as cruise and vacation packages. Many also began hiring independent travel agents working out of their homes. Today, the home-based independent travel agent is the fastest growing segment of the industry.

THE FUTURE OF THE INDUSTRY

Knowing the history of the travel industry and observing current trends, we can make some fairly accurate predictions about the future.

One obvious trend is that the travel industry is growing worldwide and is expected to continue to grow for the foreseeable future. This is very positive for the future of travel agents.

The role of travel agents is shifting from order takers of simple flight/car/hotel bookings to travel consultants as the complexity of travel products and destinations increases. There is a definite trend toward using the Internet for the simple bookings and travel agents for more complicated cruises and vacations. This trend should continue as new vacation companies enter the field, new hotels and resorts are built, new cruise ships are put into service and new places around the world become popular tourist destinations. Although the online travel agency share of the total cost of travel may increase, there will be plenty of commission generating bookings to be made by travel agents to keep them very busy.

We anticipate there will be a shortage of professional travel agents in the next few years. There are a lot of people entering the field but many of them are treating it as a part time hobby rather than as a serious career and therefore cannot replace the travel professionals that will be retiring or moving on to other positions.

Finally, a few years ago the airlines reduced and eventually eliminated commissions on airline tickets. The travel industry responded by charging service fees. More recently, the major cruise lines also eliminated commissions on flights purchased with cruise packages. Commissions on the cruise portions were not affected. Some say this trend in reduction or elimination of commissions will continue. Others say that it will be very difficult for these companies to further reduce commissions due to the very large selection and complexity of these products. We also do not anticipate any significant changes in the commission structures for cruise and vacation packages in the foreseeable future. First of all, cruise and vacation companies are not under financial pressure to reduce cost like the airlines. Also, airline tickets are very simple commodities where the only variables are the destination and price. Cruises and vacations are more complex products with many decision-making variables. These companies need experienced travel professionals that are knowledgeable of these products and destinations to sell the right cruise or vacation to their customers.

TODAY’S TRAVEL AGENTS

Travelers today are more demanding of their travel agents than ever before. Studies have shown that most people research their destinations on the Internet before they see a travel agent. This puts a lot of pressure on the travel agents to be knowledgeable of the products and destinations they sell. However, there is such a large selection of travel options and destinations that it is virtually impossible for one person to be a specialist in everything. Therefore, many travel agents today specialize in specific types of travel, lifestyles or destinations.

The historical events mentioned above helped to create three main categories of travel agents based on training, certification and type of service they provide:

Full Service Travel Agents: Full service travel agents are exactly what it means, full service. They can book any kind of travel, vacation package or cruise to any destination. This requires the highest level of education and training including the ability to use the computer reservation systems for airline tickets, car rentals and hotel bookings. The IATA/IATAN ID Card identifies them as full service travel agents when dealing with travel suppliers. Many full service travel agents also hold certificates from The Travel Institute. This distinguishes them as professional travel counselors.

Cruise Only Travel Agents: Cruise only travel agents specialize in cruises and cruise destinations. Cruise Lines International Association (CLIA) created this category when it instituted the cruise counselor training programs for the purpose of promoting and selling cruise packages from its member cruise lines. CLIA certification is the industry standard for cruise only travel agents.

Cruise and Vacation Travel Agents: This is not an official travel industry category. It is a description we use to identify a growing number of travel agents that do not fit the strict definitions of the above categories. Cruise and vacation travel agents sell both cruise packages and vacation packages. Some are cruise only travel agents that also sell vacation packages. Others are former full service travel agents that no longer wish to book airline tickets, car rentals and hotels.

There is another category known as referral agents. These people are not true travel agents. They have very little if any travel agent training and no industry certifications. They are lured by bogus multi-level schemes and outfits known as card mills with tempting quick-and-easy money making opportunities that usually include web sites, fake travel agent

ID cards and outrageous travel agent discounts. We encourage everyone interested in becoming a travel agent to be on the look out for these scams and follow the procedure outlined here. The strict requirements for listing in our service are intended to filter out these travel agent imitators.

As with many other professions, recent advances in computer and Internet technologies have made it possible for travel agents to work from just about anywhere. Today, there are two primary locations for travel agents’ offices.

Agency-Based: These are travel agents that work out of an office inside a travel agency. This is typical of the traditional travel agents mentioned at the top. Also, agency based travel agents are usually full service, unless they work for a cruise only travel agency.

Home-Based: Home-based travel agents work out of an office in their home. The pressure to reduce costs, combined with the emergence of web based booking systems significantly increased the number of home-based travel agents. Many of the new travel agents entering the industry are home based.

Since home-based travel agents can have access to the same computerized booking systems as agency based travel agents, we do not discriminate against them in our listing. Instead, we look at the travel agent’s certification, knowledge and experience and make sure they have access to the booking systems necessary to provide good service.

The ability for travel agents to work out of their home also made it possible for them to be fully independent of the travel agency. As a result, today we have two distinct employment relationships between the travel agents and travel agencies.

Direct Employees: These are travel agents that work directly for the travel agency. The travel agency withholds income taxes and provides everything the travel agent needs to work, including office space, equipment and supplies. The travel agency also provides benefits such as paid vacation and insurance. Typically, direct employees are also agency based.

Independent contractors: Independent contractors (ICs) do not work directly for the travel agency. They are independent business people that happen to be travel agents. These travel agents provide their own office space and equipment such as computers, phones and the necessary office supplies. Most are home-based. Some may have their own store front offices in a strip mall or office plaza. The travel agencies through which ICs do their bookings and provide other essential services are known as host agencies. Earnings are based strictly on the amount of business booked, the commissions generated by those bookings and the conditions specified in the contract between the ICs and host agency. In general, the travel agent share of the commission ranges between 60% and 90%. These travel agents are not guaranteed any income. There is also no limit on how much they can earn. It all depends on how much they sell.

In our listing, we also do not differentiate between direct employees and independent contractors. From the perspective of providing good service to the customer, it does not make any difference. Again, we look at the travel agent’s certification, knowledge, experience and the booking systems they use.

There is also the option of starting your own independent travel agency. We do not recommend this for somebody just getting started in the travel industry. We think it is best to start working directly for or as an independent contractor with a reputable travel agency. After you have gained some experience and have learned the ins and outs of the industry, you can make a well-informed decision if this is the right option for you. This will significantly increase your probability of success.

HOW MUCH MONEY CAN YOU MAKE?

At the end of 2007, the US Department of Labor reported that the mean annual income for travel agents was $32,190 with the top 10% making over $47,650. Studies have shown that travel agents that hold certificates from The Travel Institute or CLIA earn significantly more than their non-certified counterparts. That is why we stress training, education and certification so much. The more you know the more effective you will be as a travel agent and the more money you can expect to make.

HOW TO BECOME A TRAVEL AGENT

Becoming a travel agent, like most other professions, is a serious long-term commitment. If you want to be successful, you will have to invest some time, effort and money for a good education and training. It will make you a better, more effective travel agent and will result in increased sales and earnings that will more than compensate for the initial time and money spent.

Formal Education

There are three types of schools for travel agent training.

Colleges: There are a number of colleges that offer certificate or Associate degree programs in travel and hospitality. They provide the broadest and most thorough training. With a degree from these colleges, you can easily change careers into other areas of the travel and hospitality industry such as tour group development, sales, marketing and management. When you have a good education in the world’s largest industry, the possibilities are endless. This however is also the most expensive way to enter the travel business. The cost is well worth it for the high quality of education and training you will receive. ( See our list of colleges and training schools )

Travel Agent Training Schools: These are specialty schools that offer accelerated travel agent training. Their ten to sixteen week programs provide a little bit of everything you need to get started as a travel agent, including the use of the computerized reservation systems, sales and marketing training, and an overview of travel destinations. The advantages to these schools is that they force you to complete the program very quickly and you get the benefit of interacting with the teachers and other students. You can find these schools in just about any large metropolitan area. ( See our list of colleges and training schools )

Online Training: Online training is the third most recent option in travel agent training. TravelCampus offers the most comprehensive online training program of all the online training schools. They have different certificate programs depending on the type of travel you want to specialize in and they use a Computer Reservation System simulation for a realistic hand-on learning experience. They also offer a one-class introduction to travel that provides an overview of the basics of the travel industry and travel agent career opportunities.

Certification

There are two organizations that offer additional training and the certifications that are recognized and respected by the entire travel industry. The certificates from these organizations are what you often see following the names of professional travel agents. They have earned the right to display those certificates with pride.

The Travel Institute . The Travel Institute provides two travel agent certificates. They are the Certified Travel Associate (CTA) and the Certified Travel Counselor (CTC). The CTC certificate is the highest level of certification you can get. It is proof that you are an educated, experienced and professional travel agent.

Cruise Lines International Association (CLIA) . CLIA offers four certificates specializing in cruising. They are the Accredited Cruise Counselor (ACC), Master Cruise Counselor (MCC), Elite Cruise Counselor (ECC) and the Elite Cruise Counselor Scholar (ECCS). Their programs offer in depth cruise industry and cruise destinations training as well as sales and marketing.

Certificates from these organizations are a good way for real professional travel agents to distinguish themselves from the amateurs and travel agent imitators working for card mills. To qualify for listing on our web site, a travel agent must either hold a certificate from either of these organizations or be enrolled in their certificate programs.

On the Job Training

When you complete the travel agent training, you will receive a degree or some kind of certificate. All that shows is that you have completed the bare minimum necessary to get started as a travel agent. In addition to the learning through on the job experience, travel agencies offer many other training opportunities. These include additional training on how to use the computer reservation system (CRS) used for booking just about everything as well as training products from suppliers, travel organizations and tourism boards of various destinations.

Continuous Education

As with many other careers, continuous education is very important in the travel agent profession. There are many opportunities ffor continuous education such as classes from CLIA and The Travel Institute, seminars at conferences and trade shows, supplier presentations and familiarization trips.

TRAVEL ORGANIZATIONS

The next three organizations are critical to full service travel agents that book airline tickets.

The International Air Transport Association (IATA) . IATA is a global trade organization representing the majority of the world’s airlines. It promotes a safe, efficient and low cost airline transportation system.

The International Airlines Travel Agent Network (IATAN) . IATAN is a part of IATA. It administers the IATA/IATAN ID Card. This card is proof that you work for an Airline Appointed Agency and you can sell airline tickets as well as other travel and vacation products such as hotel reservations and car rentals. Many travel suppliers use this card to identify bona fide travel agents when providing discounts and free upgrades.

Airlines Reporting Corporation (ARC) . Although ARC is a corporation not just an organization; this is a good place to introduce it. ARC provides the accreditation that travel agencies need to sell airline tickets. It also processes travel agency issued documents, facilitates the transaction of funds between travel agencies and airlines and provides training to travel agents on how to use the ARC resources.

The organizations below are funded and supported by travel agents. They provide information and support to their travel agent members. This includes but is not limited to conferences and political lobbying on behalf of travel agents and the industry. Some even have local chapters where the travel agents can meet for support, exchange information and address local issues.

Source: onlinetravelagents.com

Category: Forex

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