How to Reduce Travel Agent Transaction Fees

TMC’s earn their money by apportioning a fee for each travel transaction being processed through them. The fee covers expenditure and profit margin. The fee is levied per traveller and is dependent on the mode of travel and destination.

For example, if your business travel programme involves travelling by air to the Americas, Europe or within the UK, then you will have 3 different levels of transaction fee.

To compare pricing between different suppliers, don’t be fooled into comparing a transaction fee in isolation. I recommend you undertake some internal analysis. Create a list of your transactions broken down by area. Ask your current supplier for this information.

Use an Excel spreadsheet to aggregate totals and compare total costs. Use a full year of transaction data and multiple each TMC’s transaction fees, by the number of transactions for each mode of transportation or accommodation. The totals will give you an accurate assessment of future costs.

Travel Agent Transaction Fees

Remember, most fees can be reduced by over 50% if reservations are purchased using your suppliers self booking tool. Automation reduces the cost of salaried staff being involved. Salaries are the biggest cost of any travel supplier and are reflected in service fees.

Transaction fees cover the cost of;

1. A centralised payment and settlement credit scheme

2. Providing cost savings reports, purchasing data,

3. Traveller tracking to cover security and well being

4. Monitoring of service for quality and efficiency

5. Travel policy advice

6. Support on mandatory governance issues

7. Investment to cover improved systems

The above is a snapshot view of how transaction fees are apportioned. Undertaking the analyses and benchmarking can be time consuming, especially if managers are juggling other projects. If this sounds familiar, the Academy offers a programme that may be of interest.

We provide a cost review as part of our Health Check Report, focusing on transaction fees. We’ll give you an honest and accurate assessment of current charging, make comparisons against market rates and identify the amount of savings available.

Career Opportunities as a Travel Agent

As recently as 15 years ago, serving the public as a travel agent was a hot job. People even went to college specifically to land a position in the travel agency career field. Fast forward to now, and some who graduated with a Bachelor’s Degree in Travel and Tourism Management are watching their diplomas gather dust as they work in a completely different endeavor.

The main reason is simply because of the widespread influence and general availability of the Internet. The Internet is now how most people make their plane reservations, secure their hotels, pull together their travel package deals, and almost anything else related to travel. No longer do they need to walk into an office and have the agent search for a great deal and then pay a commission afterward. Now it is much easier to search online and find the deals there.

Hence, travel agents are falling off left and right. Businesses are closing shop and being paid even less than ever – a stark contrast to their popularity just a short time ago. However, there are those few people who cannot dream of doing any other kind of work. And agents still venture out many times per year to explore the world with their families for less than it would cost just one person to make a trip across their own country. The deals are what lure them in and the enjoyment of the job is what keeps them motivated.

For some people, the allure of becoming a travel agent is intense. If this is you, then the time to get started is now. You don’t necessarily need to graduate from an accredited university to become a travel agent, but it certainly doesn’t hurt. Those who do graduate from college are normally the higher paid travel agents because, though you can attend a 9-month technical school, you won’t receive the quality and depth of education that you would at a typical university.

For this career, it is important that you possess good computer skills since there are many different systems and software packages you must know and use each day. You must also learn the “ins and outs” of the travel agency business, and be up-to-date on current travel advisories, passport information and special deals waiting in the wings.

If this sounds like a career path you might enjoy, then go for it. There is nothing wrong with following your dream and doing something you truly love, even if you know that salaries in the travel agency industry aren’t what they once were.