A beginner travel agent’s guide to getting paid
The travel industry is booming. Many travelers are overwhelmed with too many travel decisions and too much information, so they’re turning to travel agents to handle all of the stressful planning. Beginning travel agents are excited to start booking trips and reservations, and one of the most common questions asked is, “How do I get paid?”
Travel agents provide a number of services and work with multiple vendors. They can be self-employed, with or without a host, or they can work for an agency. All of these factors determine how and when agents get paid.
The most common way travel advisors get paid is through commissions from vendors and suppliers.
Travel advisors earn commissions from vendors they use to book trips for clients. Generally, cruise lines, hotels, rental cars, and tour operators pay out commissions that range up to around 15%. Airlines usually only offer commissions to agents that book a heavy number of business/flights. If they do, agents can expect around 5% (domestic flights) or 10% (international flights). Rental car companies pay around 8%, while cruise lines pay based on the number of rooms the agent books, usually at 12%. If you begin your travel agent career with a host agency, you’ll get a ready-made list of suppliers with their respective host agencies that you’re free to use. If you decide to start on your own, you’ll have to research and register with suppliers yourself.
Cruise lines can also be a little bit tricky because the commission is based only on the untaxable total cost. So, if the total cruise cost is $3,000 and there are $1,000 in taxes, you would get paid about 12% of $2,000, which is $240. Because of this, many travel advisors and agencies charge a flat fee for their services, which can even include a charge for negotiating room rates. So, pay depends on the specific vendor being used.
Some travel agents choose to charge planning fees or service fees for their time spent planning trips.
As a travel agent, you can charge an hourly fee, a percentage of the client’s overall cost, a flat rate, or a combination of these. For example, you can charge for the following (and more):
- booking hotel rooms – usually around 10% and does not include taxes or a flat rate
- corporate or group travel -involves more research and usually building some sort of itinerary
- arranging transportation – transfer fees can include hotel shuttle service, private planes, rental cars, or even chartered yachts
- providing travel insurance – can be a lucrative add-on to any travel package and is incredibly valuable to clients
- arranging excursions with tour operators – negotiating rates with tour guides can mean extra pay for you
- using an airline consolidator – gets the best prices, which are often lower than what the public has access to, and can put more money in your bank account.
The general rule is to make sure your fees balance out what the average traveler could do on their own – but with additional perks like room upgrades or better seats. Keep in mind that the more specialized your services are, the more things you can charge for. Do you help businesses develop corporate travel policies? If so, more money for you!
Laws regarding travel planning fees vary by state. Be sure to check your local laws before building fees into your pay structure to make sure you’re legally compliant.
When do travel agents get paid?
Travel agents get paid by vendors and suppliers directly, usually once their client’s vacation is complete.
When you first book with a vendor, they link your client’s information to your accreditation number. When the transaction is closed (most likely meaning the vacation has been completed), the vendor will pull up your agency’s details, the commission level, the address where the commission check is to be sent, and finally, send the payment.
Cruise lines pay travel agents when the final payment has been made, which is usually 60-90 days in advance of the trip. Many vendors and agencies do not send payments until the clients have returned from their vacation, so making sure your travelers are well taken care of is always the most important thing. Going the extra mile often results in customers who tell their friends about your exceptional care throughout the whole process. Agents who book trips all throughout the month get paid all throughout the month, so get out there and start serving your clients!
How do commission splits work for travel agents?
Travel agents who sign up with a host agency will often arrange a commission split at an agreed rate in exchange for resources like back-end software, marketing support, access to suppliers, training, etc. Some host agencies will let you choose your commission split when you sign up, some have a set commission split, and others base commission rates on your sales from the previous period. It’s important to consider which setup you prefer and what a host you’re considering offers. Learn more about choosing the best host agency for you here.
Let’s say, for example, you have an 80% commission split with your host agency. This means that for every commission payout you earn from a supplier, your host will keep 20% and then direct deposit the other 80% of the full amount to you.
If you choose to charge travel agent planning fees, some hosts will take a percentage of those as well, and some will not. At Pickles Travel Network, you keep 100% of the planning fees you charge.
Is it possible to make real money as a travel agent?
Absolutely! There are many ways to scale a travel business as you learn to work more efficiently, get better systems in place, create a marketing funnel, and build a team. Many travel agents earn six figures – even multiple six figures – every year. To set yourself up to get paid the most as a travel agent, don’t do it alone. Surround yourself with the right mentors and resources who know the industry and can help you get a leg up as you get started.