In today’s dynamic era, the mundane 9-5 jobs don’t appeal to the upcoming millennials.
As a result, they step into entrepreneurial ventures with a vision to expand their horizons and explore the world. While some think of becoming tour guides, others have bigger plans like starting a travel agency. After all, what could be better than exploring new places, cuisines, and cultures while making money?
The travel industry is consistently growing, which means that travel demand isn’t likely to drop anytime soon. In short, people love to travel, and these agencies make traveling effortless. From booking tickets to making hotel reservations – travel agents promise an exciting travel experience. However, an incredible business idea and passion are not enough to start a travel agency.
So, from where to start? Conduct extensive research before beginning the journey. Offer tourists travel insurance because you never know when things go wrong. Similarly, look into legal aspects, capital requirements, and the business structure before starting an agency. Here we are listing five things to keep in mind before starting a travel agency.
1. Find Your Niche
Usually, people place the entire travel industry into two categories – local and international travel. Therefore, select your target niche within the travel sector. If you are fond of snow sports, offer tours to the northern areas. Otherwise, if you can’t get enough of the German Christmas markets, take people on holiday trips. No matter which niche you choose, you have to know it inside out.
These days, people expect travel agencies to know about the places and trips they are offering. Hence, you have to be a source of knowledge to provide recommendations according to customers’ preferences. And this becomes possible when you are well-versed with the tourism industry. Although travel blogs can help, it is always smart to start from scratch. Thus, consider completing a travel and tourism degree online to polish your hospitality skills. With the online curriculum, you can keep working on your travel startup alongside and find a suitable niche.
2. Create a Business Plan
Even though you are dipping your toes in the service sector, creating a business plan is imperative. An effective strategy keeps entrepreneurs on the right track and guides them throughout their journey. It should include the agency’s core values, vision, mission, objectives, and goals. Similarly, you have to add a small business description that gives a clear idea about the services you offer to customers. Also, choose a catchy slogan that communicates your company’s vision and goals.
For instance, if you target students or the young generation, a slogan like ‘a destination for the new millennium’ would be ideal. Besides, you have to include some essential points based on your market analysis. List down your potential competitors and prepare strategies that you would use to outrank them. Lastly, mention your funding requirements and financial projections to determine how much capital you will need.
3. Evaluate Funding Needs
Whether you are starting the agency on a small scale or virtually, make sure your funding strategy is in place. Every startup requires a persistent flow of money to meet various expenses. Therefore, invest your savings into the startup, and in case they don’t seem enough, acquire a bank loan. It requires a lot of paperwork, but loans offer the most convenient way to obtain funds.
However, if you don’t want to cough up money on interest payments nor have enough savings, find a partner. It could be a family member, colleague, friend, or anyone who shares similar values. They would pool in their share of capital, fulfilling your funding requirements. Additionally, open a business bank account to manage finances smartly without mixing it up with personal expenses.
4. Cover All Legal Aspects
Once your funding needs and business structure is sorted, delve into the licensing process. After all, every travel agency has to fulfill the legal requirements. However, you won’t have to undergo any training or tests to acquire the license. Instead, you have to fill up a form and abide by the federal laws. However, some states have their own rules that you have to follow while opening a travel agency.
Depending on your state, research the laws for travel agencies. Otherwise, you can contact a lawyer who will inform you about the registration process and licensing. Moreover, you also have to apply for a federal tax ID number regardless of your income. Lastly, don’t forget to trademark your logo and get it legally registered to acquire copyrights.
5. Seek Travel Insurance
Traveling is quite expensive. People have to spend heaps of cash to plan a single trip, and what if it gets canceled? Unfortunately, all bookings and reservations are non-refundable which means people can lose their entire financial investment. Therefore, collaborate with an insurance company to offer your clients travel insurance. It would compensate for various unanticipated events such as lost or stolen luggage, interrupted trips, and even medical bills in case of emergencies. This option of insurance will strengthen people’s trust in traveling, improving revenue generation.
6. Explore Promotion Strategies
What makes your travel agency different? Instead of explaining services to customers, promote your unique selling proposition. It could be anything – free consultation, personal tour guides, refundable payments, etc. After this, explore digital marketing forums that are suitable for your business niche. Perhaps, you can optimize the website to improve visibility or create a social media profile for virtual bookings.
If you don’t know much about it, consider all means of marketing to make people aware of your travel services. You can place ads in the newspaper, distribute pamphlets, or anything that fits under your marketing budget. Most importantly, harness your customers’ positivity. Whenever someone writes positive feedback or review, share it on your webpage and social media feed.
Opening a travel agency sounds super exciting, yet overwhelming since you have to take care of many things. From finding your target audience to acquiring funds, you have to consider many things before launching it. Hence, learn about the travel and tourism industry, fulfill all legal obligations, and start promoting your business online. Lastly, offer incredible customer service to provide them with a memorable experience and make your business thrive.