A travel agency that wants to live up to the demands of the present and future business environment can no longer be just an outlet for distribution or a friendly business community. The agencies that are now looking to the future with optimism are those that structured the business, not the distribution. This article is intended to cover those owners and managers who have a fairly significant amount, have established good business relationships with corporations and are seriously concerned about their future well-being. I hope to cover several areas of concern, giving some idea of those areas that you may or may not have already planned as vital for survival. Remember, sometimes it’s obvious that it eludes us, so don’t believe that the simplicity of some of these areas is unintentional. The key to survival is overall profitability, but there are some minor areas that affect whether you are profitable or not.
profitability
Travel agency is a rare unique business when it looks at the point of profitability. This is perhaps the only retail industry that has little control over the structure of retail prices. Although there is an alternative price, it is not an effective means for an average agency to obtain and / or maintain profitability. Therefore, it is very important to carefully analyze your expenses and your income.
You spent time analyzing performance; average transaction cost versus average revenue per ticket / transaction fee? How about individual performance? Do you have fair, sustainable, viable and justifiable expectations of what your employees should produce? Does your salary match the size of your business?
If you are asked to state how much you would like to increase your volume in 2012, you will most likely have a ready answer. But have you thought about what measures you need to take to increase the volume? If you plan to increase your market share, you need to constantly grow and develop, and then follow up on sales-related meetings and presentations. It will be necessary to generate a new volume in order to increase profitability or in some cases simply maintain it. It is imperative that your organization adhere to a solid and proven sales and marketing strategy.
Set a goal, focus on it and develop a plan. Measure yourself by setting 90-, 180-, 270-, and 360-day targets. Evaluate your progress on this path and give rewards to yourself and those who have helped you achieve these goals.
Another area that affects profitability is overhead. Use the same common sense that you do at home when it comes to improving your physical environment. It seems there is a tendency, laTely, to go a little overboard with these things, thereby sharply increasing capital costs and depleting resources for potential investments in other areas.
Employees
Have you ever heard that someone said that a company is only “good” like its employees? The ability to attract and maintain good, solid, knowledgeable, mature personnel is of great importance. Modern computerization in your office is of little value if people cannot make your operation profitable.
As the fierceness of competition in the agency market grows today, it is becoming increasingly difficult to find and retain top-of-the-line employees. Look for employees with great experience or absent, the desire for success, which can be directed under your good guidance and guidance. You have to start looking into the future and develop a plan for an employee who will maintain a coherence that has been lacking in the industry for a long time. Coherence in the ranks of your employees will greatly contribute to your work. Your customers will be able to have the same friendly voices and will not question your stability due to the large turnover (which is also extremely expensive for your profit).
Find out how competitive your total compensation package is. Develop “real” incentives that have goals and measures with which the employee receives rewards. Make sure that the rewards have an essence for them. You might even want to develop a plan with which your employees can promote justice in your firm.
Study your training procedures to make sure that your employees are not far behind the technological excellence (changes, upgrades, modifications and improvements) necessary for travel agencies today. Your employees, while not inclined to invest more hours, would like to spend their hours more productively. If this is achieved, then you and the employee profit. There are many seminars with low or free practice and training forums available through various industry vendors. Let your employees connect with these features. Set up a program with an automation provider and other vendors to ensure that your employees are continually trained at a level suitable for the individual. Remember: sending an employee to an advanced CRS training workshop that has never worked with this particular CRS can be productive. Be sure to provide training at the level of understanding of the employee.
Perhaps it's time to look at the overall performance of your employees and find out the real costs and profits of each person in your payroll. Do you have an expected level of performance for each employee who justifies his salary? If not, be aware that an employee hiring $ 18,000, plus health insurance, dental insurance, and life insurance, must generate gross sales of nearly $ 250,000 so that the company can only receive salaries and benefits. It does not even take into account other overhead costs - rent, utilities, other insurances and profits. In most operational mature situations, a good, profitable commercial agent generates annual sales of $ 1,000,000.
Costs
Believe it or not, you do not need to have 700 branches in 41 states and 12 foreign countries to achieve savings in cost control. Even if you only buy one office, a good seller will want your patronage. For each cost area, find three potential suppliers who can provide you with all of your needs. Then do your best to find out what your needs will be for a long time. Remember that the more a single purchase, the more effective for the seller, which will allow you to get higher savings. Request a quote from the sellers; just like your customers have requested bids from you so you can get their business.
The cost is just on the rise. The days of buying goods in a business are simply due to the economy. You can achieve greater vitality by changing some of your non-fixed costs for semi-fixed costs, and it does not matter if you are one or more affiliates.
If you have multiple branches, consider the concept of cost centralization, where possible. Even if there is a reasonable distance between the branches, most sellers will charge shipping costs in the direction of the account location. The purchasing power gained by centralizing as many costs as possible will lead to cost savings as well as other effects that many agencies are leaving today.
Controlling spending at today's level of spending inflation will be vital for your survival over the next year or two. This is not the time to start posing for your business plan in order to gain the necessary control.
Industrial sellers
Forget that in the past. This industry has the habit of being overly resembling, and it justifies the lives of many agencies and seriously threatens many of those who still exist. The face of the main suppliers of industry suppliers / agencies has been changing for quite a long time, and I believe that 2012 and 2013 will be a period of listening to the spear for these changes.
It is time to firmly build your alliances and get to work with your future business plans with your suppliers. The entire distribution system, which we now know, was placed in a dubious position. You have to decide what steps are necessary for your survival. What agreements should be made between your agency and carriers, car rental companies, hotels, tour operators, automation suppliers, etc.? Everyone wants your business. But who offers you the best overall deal in return? It is very important that you start exploring your options and be in the long term. You will not be able to survive on short-term relationships that bring short-term dollars.
Most airline service agreements should be considered “cake icing”. Too many agencies make the mistake of thinking of it as a guaranteed, guaranteed income. It may not be. The vast majority of carriers turned to revaluations based on market share, rather than the traditional redefinition of “increased volume”. Of course, there are still random “other deals” that can help you get a few more dollars to your agency. Keep in mind every dollar offered by the carrier. Flight and / or segment cash cash bonuses paid at points of sale can generate substantial immediate dollars for you. Make sure that you and / or a reliable member of your state are consistent with these “special” offers. “Do not just refuse those emails that carriers send you. You can lose serious dollars, also available on all pages of the CRS CO-HOST DRS agency.
Also keep in mind that airlines are extremely interested in your group business, and in some cases you may be pleasantly surprised to know how few people the airline will treat in a group, and how well a specific redefinition in this group can be.
Hotels and car rental companies are also in the revaluation market, more than in the past. Calculate what your annual volume is with these suppliers, and much in the same way that you can work out to redefine the program with the air carrier; You can also get more dollars from your car dealers and hotels. It seems that there is a great deal of freedom provided to local car rental professionals, depending on their geographic location regarding what they can do for manufacturing agencies. It would seem to make sense to explore these paths. The work required to maximize your car rental commission can be worth what it costs in the long run.
To summarize, sellers in today's market are looking for strong and loyal allies. They are ready to compensate you for this loyalty. But they require that you generate substantial and consistent revenues for them.
Now is the time to look into the future and determine what you should deal with.
Mis
Survivors in today's environment have developed a keen awareness of the current needs of corporations in obtaining accurate and in-depth management data. If you are not aware of what is happening in today's automated / informational world of the tourism industry, it is possible that the time has come to look for ways, while you can get an education in this area. Agencies are increasingly seeking their ability to act as managers, information and data sources, as well as travel budgets and policies.
The change in how corporations view travel agents is welcome. He did a lot to respect business and professionals in it. The question to ask is: “Am I ready to accept new challenges related to the changing role of the travel agent?”
If you have any doubts, it’s not too late to learn and grow in the areas that you need. Your ability to support corporate management information needs is vital to your survival.
Areas of specialization
Over the past few years, agencies have begun to expand their menu of services from merely commercial and leisure travel, including Incentive, Groups and Meeting Planning. Keep in mind that such specialization requires knowledge, dedication, risk, and good planning. These “other” areas of activity are quite complex. Doing a halfway mission usually leads to a crash.
Incentive travel is complex and often misunderstood as the same as group travel. With proper administration, sales and management, this can be a very profitable venture. Major and overvalued commissions paid by travel vendors are extraordinarily good. Planning meetings is quite difficult, but again, when done correctly, you can become quite profitable. However, one of the problems with planning meetings is that the air part of the program can become quite complex. If you are not properly configured and staffed for it, you will be unpleasantly surprised. Again, there are great opportunities to increase profitability.
Specialization in these or any areas of the industry is becoming increasingly apparent these days, and the reason is that you must somehow stand out in a crowd in order to survive. Find out what it is that you and your staff will succeed. It may be worth the time and effort to clearly define the area of specialization. Developing an identity as a “specialist” when done properly can greatly increase your susceptibility and positivity, affecting your overall business.
Now we are faced with problems faced by many other industries: how to survive in a period of increasing costs and reduce revenues? If you want to survive, not time to act. Prepare for the future with a working, flexible, realistic business plan. Align yourself with suppliers properly. View costs and performance. Set standards. Develop new ways to generate revenue. Do not let what seems to be a mess around you discourage you from success.
Make 2011 what will matter. Make it the year when you decide to become a winner and a survivor!
