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How Do Travel Companies Make Money

Posted on 30 September 2019 by (0)

To most people who are thinking of joining the travel industry as travel agents, the main often asked question is how travel companies make their money. Generally, travel companies earn money through various ways mainly based on the particular travel services that they provide. Nevertheless, the following are some of the key ways through which travel companies make money.

Commissions 

Whenever a traveler hires a travel agency, the agent will do the booking for hotels, flights, car rentals, park entry among other requirements. The agent will first search for the best deals that suit your needs and preferences then, book through various vendors. Every travel agent is identified with a unique accreditation number that they will provide to the vendor when making the bookings. 

Vendors include airline companies and hotels. Using the given accreditation number, the vendor will verify the travel agent’s information including commission rates and addresses where the check should be delivered. Upon the completion of the booking, the vendor will issue a commission to the travel agent. Sometimes, the commissions are paid after the booked trip. Travel agencies are awarded commissions based on the sales that they deliver. 

Service Charge 

As competition continues to grow in the travel business, travel agencies have realized that commissions have been diminishing. Besides, many airlines stopped paying commissions. In an attempt to diversify incomes, most travel companies now charge fees for their services to vendors. That means whenever they book a flight or hotel for a client, the airline company and hotel owners must pay a standard fee. 

Due to the introduction of the service charge, travel agents can now still get paid even if they miss out on the commissions. The service fees usually vary from one travel agency to another.  

Whether you are thinking of becoming a travel agent or joining any other profession in the travel industry, the financial benefits should not be your main concern. The travel industry has so much to offer that will truly turn your life around. 



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