How to start a travel agency from scratch and succeed

How to start a travel agency from scratch

Cancellation of licensing of services provided by travel agencies has opened up new opportunities for the development of small businesses in this market niche. However, not everything is so cloudless. In a tough competitive environment, only 30% of companies manage to make a profit in the first year, and by the end of the second year, 90% of newly opened enterprises are out of the struggle. We will tell you how to open a travel agency and, most importantly, how to become one of those 10% of successful entrepreneurs who receive a stable income in the tourism industry.

Determine the format of the tourism business and the list of services

Selling a tourism product, a travel agency acts as an intermediary between the tour operator and the tourist. The interaction scheme is easy to imagine by indicating the functions of each of the participants.

  • 1. Travel agency - sells tours to consumers. This responsibility is shared by tour operators and travel agencies.
  • 2. Tour operator - an organization that develops tours, promotes them in the media and organizes sales through intermediaries.
  • 3. Travel agent is a company that finds buyers for tours organized by the operator and individual products (transfers, tickets, excursions).
The scheme of interaction between the tour operator and the agency

Before starting a travel agency, you must form an understanding of its responsibilities. This:

  • processing of visa documents;
  • transfer of railway and air tickets, medical insurance policy, accommodation voucher, information leaflet about the host country to the client;
  • booking of services ordered by the client;
  • payment of the tour to the operator.

Further, before opening a travel agency, you will need to determine the directions for sale. At the start, the following rules will help you navigate.

  • The project, as the name suggests, is focused on a specific region (TA "Caribbean Islands").
  • Managers have experience in 2-3 areas, in this case they become the main ones.
  • You yourself have visited several countries, are familiar with their customs and peculiarities and can sell tours there.
  • You choose and develop a certain type of tourism (beach holidays, medical tours, extreme tourism).

Statistics and opinion polls show that consumers are more willing to trust companies specializing in one area, expecting that here they will be more likely to answer all their questions. Therefore, if you plan to master several areas at once, you should prepare for the fact that each of them will have to be promoted separately from the others.

Travel agency: documents

Opening a travel agency is not as difficult as opening a car dealership or insurance company. But keeping up with the crazy pace of the market, opposing yourself to thousands of competitors is not an easy task.

The tourism business is very attractive for start-up entrepreneurs, because it does not require large financial investments, and the demand for tours is always great. But only a few, the most prepared, manage to avoid pitfalls, of which there are a great many in the "recreation industry".

Today tourism is massive, according to forecasts, the number of travelers will only grow every year. The number of travel agencies is increasing, new hotels and restaurants are being built, new airports are opening, and the tourist infrastructure is developing rapidly. The tourist business is experiencing a significant upsurge, and for many businessmen there is a real opportunity to become a participant in this interesting business.

So let's take a step-by-step look at how to start a travel agency from scratch for a budding entrepreneur.

Market Analysis

Before deciding to start a business, you need to at least in general terms imagine the state of affairs in the industry in which you plan to work.

So, what are the characteristics of the tourism business today:

  • Average market growth dynamics over 10 years - 5.8% per year.
  • The retail market (travel agents) is poorly consolidated, the market is dominated by independent agencies, large chains account for no more than 8-10% of the market volume.
  • Competition in the retail (travel agency) market is very high.
  • A large percentage of new travel agencies close before even one year. Average rotation in small tourist business is 30% per year. That is, out of 100 agencies created at the beginning of the year, no more than 70 companies survive until the end of the first summer season.
  • Tourism is subject to dumping, i.e. artificially lowering the offer price on "hot" destinations, even in the high season, you can find tours and air tickets much lower than the average price.
  • The tourism business is highly susceptible to external influences, be it bad weather, natural disasters, strikes, political instability or terrorist attacks. Each such event forces travel companies to respond quickly and take emergency measures to protect their customers and not suffer financially themselves. Unfortunately, this is not always possible. At the same time, every event in the world can become a reason for a tourist boom. Sports competitions, festivals, exhibitions, concerts, mass celebrations, the opening of new hotels and resorts - just countless. Therefore, the tourism industry has the opportunity to constantly develop, and its participants make a profit from the skillful use of tourism resources.

Where to start?

At the stage of planning the company's activities, it is necessary to determine the target audience of buyers. This is necessary to create the concept of the project, since the characteristics and preferences of your potential buyers will affect the choice of the location of the office, the range of tours, it is very likely that the name of the travel agency, and then the means and methods of promoting services.

Business plan

Then you need to write a business plan for the travel agency. What should you pay special attention to when drawing up a business plan?

The creation of a travel agency involves the provision of travel services to individuals. It is divided into two types: services that are provided as a package tour or are individually selected. In this article, we will consider how to open a travel agency from scratch, what documents are required, what is the payback and profitability. Let's start with the advantages and disadvantages of a business.

Infographic: How to start a travel agency from scratch

Advantages and disadvantages of opening a travel agency

Let's list the main difficulties and advantages that you can face in this business.

Advantages Disadvantages Low cost of organizing a business High competition in business Business all year round (recession is possible in winter) Difficulty in promoting your services

Travel Agency Registration: Documents

Registration of a travel agency consists of three parts:

  • Registration of a legal entity.
  • Registration of a tourist license.
  • Obtaining a certificate of conformity.

For registration with the tax office, select the code of the main activity (OKVED) - 63. 0 Activities of travel agencies (the group includes: activities of organizers of tour operators, activities of travel agents, activities of tour guides, guides).

A tour operator, due to greater responsibility, can only register an LLC, while a travel agency is given a choice between an LLC and an individual entrepreneur.

In most cases, the legal form is chosen - LLC. This is due to the fact that clients do not particularly trust individual entrepreneurs in the field of tourism, therefore they prefer LLC. The activities of the travel agency are subject to the simplified taxation system (STS). In this case, the tax rate is calculated in one of two ways:

  • Tax is defined as 6% of income.
  • The difference between income and expense is taken into account, from which 15% is taken into account of tax payments (the method is preferable if expenses are large).

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