Let's be honest: When it comes to traveling, most of us worry a lot about our budget. Some travelers have difficulty trusting travel agents or advisors because they fear being charged for using their services.
Yet not all travel advisors charge fees, although this is becoming an increasingly common trend.
TravelPulse took an in-depth look at why and how travel agents charge for their trip planning services and why some choose to keep their trip planning services free for travelers.
Are travel agents free?
The question is more complicated than one might think at first glance.
Traditionally, travel advisors receive a commission from their suppliers. So if you go on a cruise, the cruise line will pay the travel advisor you used to book your trip.
Commissions are usually a standard commission rate decided by the cruise line (e.g. 20% of the cruise cost), although this can vary depending on, for example, whether your travel advisor is affiliated with a travel agency. home which can provide higher commissions. for suppliers they use most frequently due to business partnerships (although host agencies often take a portion of a travel advisor's commission, which can further complicate matters). This is the case for cruise lines, tour operators, hotels and resorts and even package tour operators.
Commissions used to be the standard way travel advisors made money: not by charging clients, but by making money from the vendors they used.
Tammy Levent, president of Elite Travel Management, explains why his agency has never charged a fee: “At Elite Travel, after thriving in the travel industry for over 30 years, we have built a strong reputation based on trust and exceptional service. We understand the competitive nature of today's travel market, especially with the rise of online booking platforms…”
“Introducing service charges could discourage potential customers from booking with us,” Levent explained. “Our goal is to remove any barriers that might prevent someone from benefiting from our superior service and competitive rates. We are confident that once customers experience Elite Travel's offerings, they will see the value we offer them. Additionally, during our initial interactions, we let our customers know that we operate on a commission basis. We would like to ask them to contact us with serious booking intentions or to wait until they are ready to book, thus guaranteeing a commitment to the quality and seriousness of our services.
The growth in the number of travel agents charging fees
Let's face it: a cost of living crisis is plaguing cities and countries around the world, which has led many people in different industries to change their business tactics.
The same thing is happening among travel advisors, and a new trend has started: charging fees for certain travel planning services. Of the 26 travel advisors who chose to share their expertise for this feature, 17 of them charged a trip planning service fee, although their pricing structures were not equal.
So what are the specific reasons why travel advisors start charging fees for their services? Let's take a closer look.
Why do some travel agents charge fees?
One of the main reasons travel advisors choose to charge fees for their trip planning services is eliminate any customers who might not be serious long-term customers. Travel advisors may spend hours sourcing and reviewing trips for travelers, but those same travelers may simply book directly or choose to plan the trip themselves, thereby depriving their advisor of the opportunity to generate revenue through these hours. This is just an example of one of the the frustrations of a travel advisor.
More complex bookings like FIT travel, group travel, destination weddings or meetings can also take hours to plan, but most travel advisors are not paid by the hour. This means they rely on the promise of a commission only after their customers have left on their trip.
Travel agent working to correct a problem. (Photo credit: M-Production / Adobe Stock)
Another reason should be easy to understand: sometimes commissions are not enough. Imagine a travel advisor only earns $200 commission on a FIT reservation that took 16 hours to plan, book and execute. Divided by the number of hours spent planning the trip, the travel advisor's take-home pay is just $12.5 per hour.
Although this is a creative example, it can demonstrate that sometimes the time spent planning someone else's trip does not actually pay off in terms of the amount of commission the advisor will earn, i.e. which leads some to introduce travel planning fees, fees for booking airline tickets (another segment that pays relatively little to no commission) and more.
JoAnne Weeks, director of the vacation division at Acendas Travel, was one of the travel advisors who initially didn't charge fees but found them useful and even necessary after the pandemic ended.
“I’m the first to admit that I put off fees for a long time,” Weeks said. “Especially for cruises, but I realized I was offering my 28 years of cruise expertise to my clients for free. People would ask for information, I would take my time to research, put together a custom quote for lines they hadn't even heard of, only for them to take my information I gave them and book it for themselves- same. We were tired of being used. You have to pay to see a lawyer, a plumber's service call, and even the person who cuts your hair. We are worth it.
Weeks said the revenge travel trend of the post-pandemic travel era has led many travelers to ask for information but leave without booking with Acendas Travel, forcing her to implement a structure fare in 2021. His agency's fees include a cruise concierge fee, FIT fee, flat air service fee and more, all adjusted based on each person's planning time.
Nick Pena, a luxury travel designer at Cruise Planners, is a travel advisor who charges clients fees for purchasing airline tickets, changing itineraries and canceling.
“Charging a fee helps weed out the clients I don’t want and keeps the ones who appreciate the work I do,” Pena explained. “Having a fee structure allows the advisor to have a more stable income, ensuring that my time is paid whether they make the trip or not. Even simple tasks like ticketing airline tickets incur a $25 fee. No one else works for free, why should I?
“Charging professional fees is a testament to my worth,” he continued. “I provide a life-saving beacon amid overwhelming travel options, ever-changing regulations, and unforeseen circumstances that can arise on even the most meticulously planned trips. My fee ensures that I remain at the client's side, a watchful sentinel, as they navigate the unpredictable waters of global travel.
Why book with a travel agent?
Travel agents don't always charge fees, although this is becoming a growing trend. So why should a traveler choose to book their next trip with a travel advisor?
GOOD, it's all a question of expertise. Travel consultants are experts at planning trips, and sometimes that's exactly what you need. Even though you can book something online without ever speaking to a human being, that human connection is often what people need, especially when things go wrong on a trip or when you're looking to book something completely unique.
Madeline Steuber Johnson, co-owner of Steuber Travel Group, explains her agency's perspective: “We get a lot of calls to get to know our clients; we often spend a lot of time designing a complete itinerary before it even arrives at a DMC. We select hotels carefully and push through the quoting process with our partners, asking follow-up questions and making alternative suggestions so we can truly offer something highly personalized. This, in itself, also requires investing a huge amount of time in our education and knowledge of destinations. Our role is not to act as a middleman, passing on generic itineraries provided by companies that do this on a mass market scale.
“As you can see, our business model is not profitable if we don't charge for our time, given how much time we like to invest with our clients,” Steuber continued. “Other industries charge for their time and I have felt since starting our company that the travel industry is behind the times when it comes to fees. Interior designers are a good example of this: they charge for their design time and don't let the commission percentage they can earn on a sofa dictate the amount of work they put into a client. We don't want to compromise our deliverables or change our processes to prioritize quantity over quality so we can make more money. So, we are confident in the value we provide for the fees we charge! »
Ultimately it's up to you
Although travel advisors are increasingly starting to charge trip planning fees for their services, not all do so. Travelers can take note of this and ensure they find the solution that best suits them, their travel needs and their budget. Yet the benefit of using a travel advisor of any kind cannot be emphasized enough: they provide much-needed support in an often overwhelming planning period and can save travelers hours of work. planning.
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