While the online travel market is booming, high-street travel agents are still doing well, particularly for packages and for older holiday-makers

Holidays are big business – with millions of Britons jetting off to foreign lands every year, and many more opting for domestic breaks. To make it as a small travel agent, you’ll need to offer something different, in order to stand out from the crowd and attract custom away from the big businesses. Jamie Lawrence looks at what it takes to start up a successful travel agency.

What does the market look like?

The landscape has shifted in the previous decade, from an industry dominated by high-street brands to one where customers increasingly book holidays and trips from home. Online power-players continue to utilise the latest technology to make the experience of booking across multiple airlines and hotels a streamlined, easy process. Searches can be made on a range of criteria, including hotel star rating, cost and travel time. Overheads for these companies are also cheaper, which means the overall package price is often lower than high-street agents.

While this is a reality that all high-street travel agents must face, it does not mean there is no market for ‘real-world’ travel agents. Like many industries, the continual shift to online purchasing has impacted most heavily on mainstream travel agents, those that aim to provide a service to all parts of the market. Many have gone into administration while others have had their eyes opened to the necessity of radically altering their business model.

For the more specialised travel agents, the shift has still been shocking, but less explosive, because it’s much harder to provide a specialised service online. Operating in a niche and providing something that the online travel brokers can’t do has been a saving grace for some firms.

Many high-street travel agents continue to survive; the larger ones, by re-focusing on a narrower target market and making sure their service offers something more than online avenues. The smaller travel agents have adopted the same strategy; some have also rejuvenated efforts to strengthen their brand so that their expertise becomes a unique selling point which will hopefully attract custom.


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What sort of travel agent should I start?

Mainstream travel agencies are out, with one exception – opening a personalised travel agency in a very strong local community where trust and integrity are strong. This will be more popular in locations with older residents that are less keen on using the internet. Many of these businesses have survived because local residents know the owners/managers personally and continue to give custom.

If this option is not possible, a specialised travel agent is the way to go. Some of the potential specialties include winter sports, theatre breaks, domestic breaks and backpacking, but make sure the one you choose has the most market potential – don’t go for your favourite. To gauge interest, market research is essential, and lots of it. You have to be 100 percent sure your choice will work within the local area (some travel agents, if specialist enough, will attract custom from outside the area).


What skills/training will I need?

People skills are essential because creating a successful travel agency in today’s online-driven marketplace means building relationships with clients to ensure repeat custom. You’ll need to be driven by good customer service and prepared to go the extra mile at all times, regardless of how you’re feeling that day.

An awareness of the holiday industry, and knowledge of popular and ‘hidden gem’ destinations will also be very useful, but this can be learned as you go along (you should learn it quickly, however). Another option, if you don’t already have experience in the holiday industry, is to gain it through personal research before you start your business.

You don’t need any specific training to become a travel agent; practical experience can help so you could gain experience working in another travel agency before you start up on your own. You may also find that customer service courses help as they help you develop the skills necessary to build rapport with customers.

Compliance regulations

Travel agents must provide a bond to clients to reimburse any monies paid should the company go into administration. This is a legal requirement and must be arranged with either an insurance company or bank.

If you want to sell plane tickets, you must also have Air Travel Organisers Licensing (ATOL), otherwise you can only sell overland transport, which will limit your market considerably.

Joining a trade association is a very wise move – it adds credibility to your business and you’ll find it hard to deal with suppliers and clients without it. The Association of British Travel Agents (ABTA) is the most well-known, but also the most expensive, and it can be out of the financial reach of smaller agents.

The Travel Trust Association (TTA) or the Global Travel Group are good choices for start-ups, particularly as they provide bonds to clients and ATOL as part of the membership package. These are not provided with ABTA.

Insurance is also a must have to protect yourself against lawsuits and other liabilities – employer’s liability insurance once you take on your first staff member, and public liability insurance, which protects you against third-party injury or damage to property due to your own negligence. You may also wish to consider professional indemnity insurance, which protects against clients’ allegations of wrongdoing.

Start-up costs

Start-up costs vary but it’s difficult to start a travel agency on a budget because there are unavoidable costs. Even if you start from home, taking bookings by phone, you’ll need a decent booking system and will need to pay for association membership. The cost of membership of the Global Travel Group is from £14,995. This cost includes access to everything you need to set up and build your own independent travel business.

Renting commercial premises can be expensive, and you may also need to retrofit the existing outfit for purpose, along with the cost of computer equipment. If starting from a commercial location, you’d be hard pressed to start up for less than £50,000, and you’ll probably want to budget more in order to effectively market your start-up

Key indicators of success

There are lots of things you have to get right to run a successful travel agent. Here are some of them:

  • Develop favourable relationships and rates with airlines, cruise lines, hotels and tour operators
  • Gain access to favourable discounts open only to established travel agents
  • Pay close attention to what sells and ensure your marketing materials reflect your findings
  • Understand the most profitable way to sell holidays to your customers e.g. separate airline and hotel, or re-sell a package from another provider
  • Pay attention to market trends so you can set the pace e.g. be aware of the best domestic locations if consumers are feeling the pinch.