For a lot of travel agents starting their own company, it’s hard to tell if going with a franchise, consortium, or a host agency is the right choice. Why use a host agency? What are the benefits of using a host agency? As a person that specializes in that niche, I can tell you the benefits of using a host agency so you can make the right decision!
Before we start, you need to be aware what a host agency is. You also need to be aware that there are numerous host agency business models. Some host agencies provide limited services beyond the use of their accreditation number (ARC, CLIA, TRUE, IATA, etc.). Other host agencies provide everything but the kitchen sink. Since different travel agents have different needs, it’s important to keep in mind there are many ways to ‘host’. More on finding the best host agency for you.
So, we get that you need to find a host agency that fits the needs of your particular agency, right? The advantages below are based on basic services most host agencies provide. Before you sign up, make sure to confirm your prospective host agency provides these services.
Bookkeeping: A host agency should play the role of a part-time bookkeeper at your travel agency. That’s a huge benefit of using a host agency so keep in mind part of your commission cut is paying for a bookkeeper. They can run reports on the bookings you’ve made without you having to purchase any software. They will issue you out commission statements and, at the end of the year, send you a 1099 or T4A with all your earnings. The more advanced hosts should allow you to look up bookings, run reports, etc. as part of what they provide. Centre Holidays trains you on how to use their invoicing system to invoice your clients, track your commission earnings and more.
Commissions: A travel agency’s commission level is based on their vendor revenue. A big benefit of using a host agency is that all of the home based agents under that host are seen as one travel agency. If it’s a decent sized host, the combined buying power should give you top commissions on all major suppliers. Centre Holidays currently has over 200 home based travel agents.
Access: The business development managers (BDMs) that work with travel agencies have large territories. One of the benefits of using a host agency is that host have already established relationships with these BDMs. Many hosts are most likely a larger account for the BDM. If you have problems with a booking, the sales volume and long-standing partnership of your host will – if necessary – allow the situation to be escalated through the host agency’s channels.
Technology/Marketing: One of the many benefits of using a host agency is that the top host agencies offer a whole arsenal of technology. Programs commonly offered are direct mail programs, consumer website programs, corporate booking engines, etc.
Education: Host agencies are top recruiters of the (much needed) new blood for the travel industry. Because of that, many host agencies will offer not only continuing education but training or a mentoring program. It’s also common to see a host agency offer online training tailored towards new agents. While it’s possible to learn how to be a travel agent without any training, a good training program can speed up the learning curve and help you start making money quicker. This a one of the major benefits of using a host agency – it’s a great gateway into the industry. For experienced agents, hosts often put together their own FAMs for continuing education and may partner with vendors to provide continual continuing education for their agents. Centre Holidays offers initial as well as on-going training. You will also have access to training programs from our various travel suppliers and online travel course companies.
Networking: Being a home based travel agent has its advantages but one common complaint is the social isolation. A host agency that cultivates community can ease the isolation by helping you meet other travel agents. Those agents are a great source of knowledge to help you build your business and support you as you grow. Centre Holidays agents are all connected and help / support each other on a daily basis.
Lower Start Up Costs: Another benefit of using a host agency is that host agencies are typically less expensive than going with a franchise or consortium. It’s a great avenue for those new to the business or smaller agencies. Some hosts offer 100% commission plans but typically there is a commission split involved. Even with the split, the advantages of higher commissions and the benefits listed above make it worthwhile for many home based travel agents. Note: You can also earn extra from certain supplier’s rewards programs.
In closing, a host agency is a fantastic way to start up your travel agency and have both independence to run your travel agency the way you want to and also have built-in support. With low risk, low start-up costs, and a community of agents and staff to help you on your way, joining a host agency is a great fit for many travel agents.
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