If I asked you to name the number one way to identify a healthy business, you’d probably say, “profitability”. An understandable answer, but it doesn’t tell you the entire picture. For the long run profitability isn’t the only important consideration. A business can be profitable on paper, but not sustainable in the long-run. There are 4 areas I think you need to evaluate in order to be successful:

  1. Money
  2. Products
  3. Marketing
  4. Satisfaction



Since money is the most obvious, let’s tackle it first. It’s important to take a look at your bottom line throughout the year and not just at year-end. When the year is coming to a close you want to look at the big picture and see what you can do differently next year. What worked? What didn’t? 

When you look at your financials — whether they are on paper, in a spreadsheet, or in an accounting system — look first at the big picture. Did you make money? Did you make enough? Do you want to make more? Now dig into those numbers and consider the following questions:


  1. Did you pay yourself a salary? Most travel agents don’t, but all should. If you are technically profitable, but not paying yourself a salary, that’s the first thing to change. If you aren’t profitable and not paying yourself a salary, how can you make changes that will allow that to happen? 
  2. What’s your average booking amount? This is another number a lot of agents don’t look at but should be very familiar with. Increasing your average booking amount dramatically impacts your bottom line. There are lots of ways to do this, and the one I see that makes the fastest and most direct impact is selling third-party insurance. With commission rates of 20% to 35%, it makes a big difference to your year-end numbers. 
  3. Where are you making the most money? We all know that vendors don’t all pay the same commission level and therefore you make more money on some types of bookings than you do others. While you don’t have to tell a client “no” when they want to book a lower-paying product, you certainly don’t want to spend time marketing it. You also need to know what your yield is for each of your vendors. More on that below. 
  4. What is costing you the most money? Look at those big cost items closely and make sure they are paying dividends. For many travel agents their host agency is one of their larger expenses. Are you getting your money’s worth? If not, is that because they don’t offer what you need? Or are you just not taking advantage of the options? Either way, it’s a fixable problem. And if you are generating more than $750,000 in bookings per year, you need to be on a 100% commission plan. Yes, they exist (contact joinus@giftedtravelnetwork.com if you want to know more about ours) and while you pay more each month in fees, you more than make up for it in the long run.



Considering your product mix is an important step in improving your bottom line. Travel agents have more control over their product mix than they think. It’s important to first know who your top suppliers are. I would at least know the top 10 from a sales standpoint. Then I would look at the yield for each of these vendors. This is where that control comes in. If you are working with a wholesaler with an average yield of 10% and another with an average yield of 12.5%, moving business from the first to the second can have a substantial impact on your business. It’s not a 2.5% increase, it’s a 25% increase. To calculate yield, divide your total commission (make sure to use the total commission generated, not just the amount you personally received) by your total sales. For example, if you sold $250,000 with a vendor that generated a total of $31,250 in total commission, that’s a yield of 12.5% (31,250 divided by 250,000=0.125 or 12.5%). Your commission with this supplier might be 13%, 15% or 18%, but there are very often non-commissionable charges in any booking that result in a yield that is lower than the commission rate. 

Once you know your yield you can start using that information to affect who you work with. This includes shifting clients from one brand they may come in asking for to another.Of course, there are times when that isn’t possible because your client insists on a particular product, but with some bookings it doesn’t matter.



Marketing is an area a lot of travel agents don’t think about evaluating at year-end because it isn’t always black and white. Sometimes it is hard to know what worked and what didn’t, but you need to do your best to evaluate each marketing channel for effectiveness. It’s not just about where new clients come from, although that is certainly important. You also need to look at long-term exposure to your ideal client. Remember that marketing isn’t linear. One marketing activity doesn’t equate to one booking. Sometimes you have to invest in a channel for a while to see dividends. Also consider what other options you aren’t doing that could work. Are there marketing options through your host or consortium that you could be participating in? 



Finally, are you happy? How is your work-life balance? If you are working 12 hours days 6 or 7 days a week, that’s not sustainable or healthy. Taking a hard look at what you are getting out of your travel business. Tweak what’s working and what’s not. It’s your business and you should be running it, not it running you! 

Sometimes I think travel agents forget that this is a business that they have complete and total control over. If you are like most travel agents and operate as a solopreneur, you alone can dictate changes in your business. It takes courage to make big changes, but possible. Having a great support system makes it a lot easier so make sure you have that. If there are things about 2019 you aren’t pleased with, take action now to ensure you aren’t revisiting the same problem at the end of 2020.