Travel agency

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Allamanda Voyages travel agency in Paris Allamanda Voyages, 3 Impasse de la Gaite, 75014 Paris 2014.jpg
Allamanda Voyages travel agency in Paris
Travel agency in Rio de Janeiro, Brazil Condor Viagens & Turismo Ltda.jpg
Travel agency in Rio de Janeiro, Brazil
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Travel agency in Taiwan

A travel agency is a private retailer or public service that provides travel and tourism-related services to the general public on behalf of accommodation or travel suppliers to offer different kinds of travelling packages for each destination. Travel agencies can provide outdoor recreation, arranging logistics for luggage and medical items delivery for travellers upon request, public transport timetables, car rentals, and bureau de change services. Travel agencies can also serve as general sales agents for airlines that do not have offices in a specific region. A travel agency's main function is to act as an agent, selling travel products and services on behalf of a supplier. They are also called Travel Advisors. They do not keep inventory in-hand unless they have pre-booked hotel rooms or cabins on a cruise ship for a group travel event such as a wedding, honeymoon, or other group event.

Contents

Business model

Travel agencies often receive commissions and other benefits and incentives from providers or may charge a fee to the end users. [1] Hotel owners and tour operators typically pay a higher commission rate to travel agencies, whereas airlines typically pay no commission. [2] The customer is normally not made aware of how much the travel agent is earning in commissions and other benefits. [3] A 2016 survey of 1,193 travel agents in the United States found that on average 78% of their revenue was from commissions and 22% was generated from fees. [4]

Accreditation number

Travel agencies are recognized by vendors through their accreditation numbers.

In the United States, the main accreditation numbers are issued by Airline Reporting Corporation, Cruise Lines International Association, International Air Transport Association.

If more than one travel agency is booking under the same accreditation number, the agency of record is called a host agency. [5] This is a popular model in the United States, with surveys show anywhere from 43-85% of leisure agencies now booking under a host agency. [6] [7] [8]

Travel technology

Travel agencies use the services of the major computer reservations systems, also known as global distribution systems (GDS), including: Amadeus CRS, Galileo GDS, Sabre, and Worldspan, which is a subsidiary of Travelport, which allow for comparison and sorting of hotel and flight rates with multiple companies. [9] Bookings made via travel agents, including online travel agents, may or may not be confirmed instantly. Unlike online travel agencies, metasearch engines and scraper sites, such as Skyscanner, Kayak.com, Rome2rio, and TripAdvisor, travel agencies may or may not have their own booking engine, and instead provide results for search queries and then divert traffic to service providers or online travel agencies for booking. [10] [11] [12] [13] Travel agents may also work with airline consolidators. [14] [15]

Some companies use technology to promote sustainable tourism and bring carbon-neutrality. [16]

Types of agencies

Travel agencies can be multinational companies, referred to as "multiples" in the United Kingdom. They can also be medium-sized organizations, referred to as "miniples" in the United Kingdom, or can be independent, small companies. They can be structured as a limited liability company, a sole proprietorship, or can be set up as a host, franchising, or consortium structure.

Traditional travel agencies

A traditional travel agent may work for a travel agency or work freelance. [17] [18] [19]

Helloworld Travel is an example of a franchised travel agency, giving agents access to internal systems for product and bookings. [20]

While most point-to-point travel is now booked online, traditional agents specialize in niche markets such as corporate travel, luxury travel, cruises, complicated and important trips, and specialty trips. [21] Other niche markets for traditional travel agencies include travelers with disabilities, travelers over the age of 60, women traveling alone, LGBT tourism, [22] or a particular group interested in a similar activity, such as a sport. [23] [24] Other examples of travel niches include StudentUniverse, which specialize in youth travel, or CWT, which caters to corporate travel.

Many traditional travel agencies are now home-based to reduce overhead. Agents can act as "travel consultants" with extensive knowledge of destination regions and specialize in topics like nautical tourism or cultural tourism. [25] Many traditional agents prefer the term "travel advisor" as opposed to "travel agent" to emphasize their advice, expertise, and connections that are of great value. [26]

Licensing

In many countries, all travel agencies are required to be licensed by the International Air Transport Association (IATA). [27] Many are also bonded and represented by IATA, and, for those that issue air tickets, the Air Travel Organisers' Licensing (ATOL) in the United Kingdom, and the Airlines Reporting Corporation in the United States also serve those purposes. [28] ABTA – The Travel Association the Association of Canadian Travel Agencies (ACTA) The American Society of Travel Advisors (ASTA), represent travel agencies in the United Kingdom, Canada, and the United States respectively. [29] [30]

History

In 1758, Cox & Kings became the first travel agency in modern history. [31] [32]

In 1840, the Abreu Agency was established in Porto by Bernardo Abreu, becoming the world's first agency to open its services to the public.

A Thomas Cook travel agency in the United Kingdom, which ceased operating in 2019. Thomas Cook R.I.P. flowers Enfield, London.jpg
A Thomas Cook travel agency in the United Kingdom, which ceased operating in 2019.

In 1841, Thomas Cook, a Baptist preacher who believed that alcohol was to blame for social problems, reached an agreement with the Midland Railway to organize the transportation of 500 members of his temperance movement from the Leicester Campbell Street railway station to a rally in Loughborough in exchange for a commission. [33] [34] He formed Thomas Cook & Son, which later became The Thomas Cook Group. It filed bankruptcy and underwent liquidation in 2019. [35]

In 1871, Dean and Dawson was founded in the United Kingdom and in the 1950s, it was acquired by Thomas Cook. [36]

In 1870, the Polytechnic Touring Association was founded in the United Kingdom.

In 1887, Walter T. Brownell established Brownell Travel, the first travel agency in the United States, and led 10 travelers on a European tour setting sail from New York on the SS Devonia. [37]

In 1895, Baldwins Travel was founded by Alfred K Baldwin, originally a printer, bookbinder and publisher in Tunbridge Wells. Baldwins begins selling railway tickets and helping friends to travel to Europe and beyond. News spreads and the former printers slowly build a strong side-line in travel at the back of the Baldwins Stationery shop at 27 Grosvenor Road. [38]

In 1905, Nippon Travel Agency became the first travel agency in Japan. [39]

Originally, travel agencies largely catered to middle and upper-class customers but they became more commonplace with the development of commercial aviation.

In 1923, after being treated badly by a British travel agency, K. P. Chen formed what became the China Travel Service, the first travel agency in China. [40]

The industry suffered during World War II. However, the Post–World War II economic expansion in mass-market package tours resulted in the proliferation of travel agencies catering to the working class. [41]

In 1929, Intourist was formed as the official state travel agency of the Soviet Union, with the goal of convincing outsiders to visit the country. [42]

In 1931, the US trade organization ASTA (originally the American Steamship and Tourist Agents Association, now the American Society of Travel Advisors) was created. [43]

During the Cold War, travel agents were used by people from Western countries to travel behind the Iron Curtain. [44]

In 1951, the precursor to Helloworld Travel became one of the first travel agencies in Australia.

In 1955, Henderson Travel Service in Atlanta, Georgia became the first African-American-owned travel company and the first to take large groups of black American tourists to Africa. [45] [46]

A Keihasmatkat advertisement from Rhodes in 1971. Keihasmatkat 1972.jpg
A Keihäsmatkat advertisement from Rhodes in 1971.

In the early 1980s, American Airlines' Sabre unit created a direct-to-consumer booking tool[ clarification needed ] for flights, hotels and cars called eAAsySabre. [47]

In 1989, with the liberalization of travel for South Koreans, Mode Tour became the first travel agency in the country. [48]

In 1991, Hotel Reservations Network, the precursor of Hotels.com, was founded. At first, hotels did not pay much in commissions. [47]

With the advent of the internet, travel agencies migrated online and underwent disintermediation by the reduction in costs caused by removing layers from the package holiday distribution network. [49]

In 1994, Travelweb.com launched as the first online directory of hotels. [50]

In 1995, Internet Travel Network sold the first airline ticket via the World Wide Web. [50]

In October 1996, Expedia.com, funded with hundreds of millions of dollars by Microsoft launched as the first large online travel agency. [47]

At the same time, Cheapflights started as a listing service for flight deals from consolidators. [47]

In 1998, Lastminute.com was founded in the United Kingdom. [50]

In 1999, Expedia went public on the Nasdaq stock exchange. From 1999 to 2006, the number of travel agents in the United States plunged from 124,000 to 88,000 as many Americans switched to making their own travel arrangements online. [51]

Also in 1999, European airlines began eliminating or reducing commissions, [52] while Singapore Airlines did so in parts of Asia. In 2002, several airlines in the United States did the same, which led to an unsuccessful lawsuit alleging collusion among the airlines, that was decided on appeal in 2009. [53] [54]

In 2007, the launch of the iPhone and related mobile apps increased travel bookings made online. [50]

In 2008, the launch of Airbnb created an online marketplace for spare bedrooms and apartments. [50]

In 2011, the launch of HotelTonight highlighted instantaneous same-day hotel room booking. [50]

In 2021, travel agency Baldwins Travel Group, which was founded in 1895 was bought by business group [55] Inc & Co.

Outlook

According to the United States Bureau of Labor Statistics, in 2022, there were 66,300 people who were employed as travel agents for their full-time jobs. That number is projected to increase by 3% over the next 10 years. In 2022, the BLS lists the median travel agent salary as $46,400 per year. [56]

Host Agency Reviews lists employee salaries by compensation structure, listing the 2022 income for travel agents that earn salary + commissions (25% of travel advisor employees) at $88,909, those that earn salary/hourly only at $50,792 (44% of employee travel agents), and commission only travel employees at $21,932 (31%). [57]

However, job prospects should be best for travel agents who specialize in specific destinations or particular types of travelers.

Several reports show that the number of people using travel agents to book travel has been increasing. [58] [59] [60] [61]

See also

Related Research Articles

Priceline.com is an online travel agency for finding discount rates for travel-related purchases such as airline tickets and hotel stays. The company facilitates the provision of travel services from its suppliers to its clients. Priceline.com is headquartered in Norwalk, Connecticut, United States and is wholly owned by Booking Holdings, which also owns Kayak.com, Booking.com and other sites. The company was founded in 1997. It operates in more than 200 countries and territories around the world and has partnerships with over 400 airlines and 300,000 hotels. Users can search for travel deals and discounts on the website, and in the past also offered the "Name Your Own Price" feature to bid on hotel rooms and flights.

A passenger name record (PNR) is a record in the database of a computer reservation system (CRS) that contains the itinerary for a passenger or a group of passengers travelling together. The concept of a PNR was first introduced by airlines that needed to exchange reservation information in case passengers required flights of multiple airlines to reach their destination ("interlining"). For this purpose, IATA and ATA have defined standards for interline messaging of PNR and other data through the "ATA/IATA Reservations Interline Message Procedures - Passenger" (AIRIMP). There is no general industry standard for the layout and content of a PNR. In practice, each CRS or hosting system has its own proprietary standards, although common industry needs, including the need to map PNR data easily to AIRIMP messages, has resulted in many general similarities in data content and format between all of the major systems.

<span class="mw-page-title-main">Vacation rental</span> Furnished dwelling for short-term stays

A vacation rental is the renting out of a furnished apartment, house, or professionally managed resort-condominium complex on a temporary basis to tourists as an alternative to a hotel. The term vacation rental is mainly used in the US. Other terms used are self-catering rental, holiday home, holiday let, cottage holiday and gite.

Tripadvisor, Inc. is an American company that operates online travel agencies, comparison shopping websites, and mobile apps with user-generated content.

<span class="mw-page-title-main">Amadeus IT Group</span> Spanish travel technology company

Amadeus IT Group, S.A. is a major Spanish multinational technology company that provides software for the global travel and tourism industry. It is the world's leading provider of travel technology that focus on developing software for airlines, hotels, travel agencies, and other travel-related businesses.

Cheapflights is a travel fare metasearch engine. The website is part of the Kayak.com subsidiary of Booking Holdings.

<span class="mw-page-title-main">Kayak (company)</span> Travel metasearch engine owned and operated by Booking Holdings

Kayak is a metasearch engine for travel services, including airline flights, hotels, rental cars, and vacation packages. It is owned and operated by Booking Holdings.

<span class="mw-page-title-main">Thomas Cook Group</span> Former global travel group

Thomas Cook Group plc was a global travel group, headquartered in the United Kingdom and listed on the London Stock Exchange from its formation on 19 June 2007 by the merger of Thomas Cook AG — successor to Thomas Cook & Son — and MyTravel Group until 23 September 2019, when it went into compulsory liquidation. The group operated as a tour operator and airline, and also operated travel agencies in Europe. At the time of the group's collapse, approximately 21,000 worldwide employees were left without jobs and 600,000 customers were left abroad, triggering the UK's largest peacetime repatriation.

Dubai National Air Travel Agency is an Emirati airport services provider which provides aircraft ground handling, cargo, travel, and flight catering services across five continents.

A travel website is a website that provides travel reviews, trip fares, or a combination of both. Over 1.5 billion people book travel per year, 70% of which is done online.

<span class="mw-page-title-main">Wego.com</span> Singapore-based travel search engine

Wego is a travel app for flight search and booking in the MENA.

<span class="mw-page-title-main">Agoda</span> Singaporean online travel agency

Agoda.com is an online travel agency catering to customers around the world, registered and headquarters in Singapore with operations in Bangkok, Thailand. Agoda facilitates reservations for accommodation, flights, ground transportation, and activities. It is a subsidiary of Booking Holdings.

Corporate travel management is the function of managing a company’s strategic approach to travel, the negotiations with all vendors, day-to-day operation of the corporate travel program, traveler safety and security, credit-card management and travel and expenses ('T&E') data management.

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<span class="mw-page-title-main">Booking.com</span> Dutch online travel agency

Booking.com is one of the largest online travel agencies. It is headquartered in Amsterdam, and is a subsidiary of Booking Holdings. Booking.com provides lodging reservation services for approximately 3.4 million properties, including 475,000 hotels, motels, and resorts and 2.9 million homes, apartments in over 220 countries and territories and in over 40 languages. It also sells flights in 55 markets and tours and activities in more than 1,300 cities. Hotel partners have reported not being paid for months at a time, leaving small hoteliers out of pocket.

A resort fee, also called a facility fee, a destination fee, an amenity fee, an urban fee, a resort charge, or a hidden hotel booking fee, is an additional fee that a guest is charged by an accommodation provider, usually calculated on a per day basis, in addition to a base room rate.

Tripfez Travel is an online travel agency and metasearch engine focusing on Muslims and Halal tourism.

eDreams ODIGEO is a Spanish online travel company that was formed in 2011 as the successor of eDreams with the merger of online travel agencies eDreams and GO Voyages, and the acquisition of Opodo.

Booking Holdings Inc. is an American travel technology company incorporated under Delaware General Corporation Law and based in Norwalk, Connecticut, that owns and operates several travel fare aggregators and travel fare metasearch engines including namesake and flagship Booking.com, Priceline.com, Agoda, Kayak, Cheapflights, Rentalcars.com, Momondo, and OpenTable. It operates websites in about 40 languages and 200 countries.

PT Trinusa Travelindo, operating as Traveloka is an Indonesian technology company focused on travel and ticketing. Operating a services website and mobile application of the same name and based out of Jakarta, Indonesia, Traveloka is active in six countries, and in 2022 remained the largest online travel app in Southeast Asia. Founded in 2012 as a travel search engine, it now also offers services such as cruises, attraction tickets, activities, transportation rentals, and restaurant vouchers. It also provides financial services such as credit and insurance. Classified as a unicorn company and regarded as functionally similar to Expedia, in 2022 it was valued approximately at US$3 billion.

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