A travel agency is a company that provides travel and tourism-related services to individuals, families, groups, and corporate organizations.
A travel agency can also provide outdoor recreation activities, airline booking, car rentals, cruise trips, hotels, travel insurance, package tours, guide books, VIP airport lounge access, arranging logistics for luggage and medical items delivery, public transport timetables, car rentals, and bureau de change services.
Available statistics show that the market size of the travel agency sector in the United States fell to 20.69 billion U.S. dollars in 2020, down from the previous year’s total of 56.96 billion U.S. dollars. But the market size of the industry is expected to increase by 38.3 percent in 2023. in 2023, the market size of this sector was forecast to reach 34.64 billion, and $407.7 billion in 2023.
Steps on How to Write a Travel Agency Business Plan
Mason Gray™ Travel Agency, Inc. is a registered travel agency that will be located in Ponte Vedra Beach, Florida. We have been able to secure all the necessary permits for our facility.
At Mason Gray™ Travel Agency, Inc., our client’s best interest would always come first, and everything we do is guided by our values and professional ethics. We will ensure that we hire professionals who are experienced in the travel and tours industry. Mason Gray is the founder and CEO of Mason Gray™ Travel Agency, Inc.
a. Our Products and Services
Mason Gray™ Travel Agency, Inc. will handle all aspects of travel and tours such as booking flight tickets, securing transit visas, booking shuttle buses or taxi cabs, car rentals, hotel and cruise line bookings, insurance policy cover, sale of travel guide books, and sale of foreign currencies.
b. Nature of the Business
Our travel agency will operate both the business-to-business and business-to-consumer business models.
c. The Industry
Mason Gray™ Travel Agency, Inc. will operate in the travel and tourism services industry.
d. Mission Statement
Our mission is to establish a world-class travel agency that will provide professional travel and tourism services to a wide range of clientele both in the United States of America and other parts of the world.
e. Vision Statement
Our vision is to be among the top 3 travel agencies in the whole of the United States of America.
f. Our Tagline (Slogan)
Mason Gray™ Travel Agency, Inc. – Your Most Reliable Travel Agency!
g. Legal Structure of the Business (LLC, C Corp, S Corp, LLP)
Mason Gray™ Travel Agency, Inc. will be formed as a Limited Liability Company (LLC). The reason why we are forming an LLC is to protect our assets by limiting the liability to the resources of the business itself. The LLC will protect our CEOs’ assets from claims against the business, including lawsuits.
h. Our Organizational Structure
- Chief Executive Officer
- Admin and HR Manager
- Travels and Tours Consultant
- Marketing and Sales Executive
- Customer Care Executive/Front Desk Officer
i. Ownership/Shareholder Structure and Board Members
- Mason Gray (Owner and Chairman/Chief Executive Officer) 56 Percent Shares
- Matt Romel (Board Member) 14 Percent Shares
- Daniel Jota (Board Member) 10 Percent Shares
- Verone Lamp (Board Member) 10 Percent Shares
- Cloe Alpha (Board Member and Sectary) 10 Percent Shares.
- Ideal Location for travel agency
- Highly Experienced and Qualified Employees and Management
- Availability of all kinds of travel and tours services
- Excellent membership package
- Budget limitations
- Inability to properly manage off-peak seasons such as bad winter and pandemics influenced lockdown
- A new business that will be competing with well-established travel agencies
- Inability to retain our highly experienced and qualified employees longer than we want
- Excellent location – Ponte Vedra Beach, Florida is a thriving market for travel and tour service.
- Increase in the inflow of tourists to our location
- Online market, new services, new technology, and of course the starting of new markets
i. How Big is the Industry?
The travel agencies industry is worth over $407.7 billion in the United States.
ii. Is the Industry Growing or Declining?
The travel agencies industry is growing. Available data shows that the market size of the Travel Agencies industry is expected to increase by 38.3 percent in 2023.
iii. What are the Future Trends in the Industry
The travel and tour industry is changing, and players in the industry are improvising. No doubt, technology, and social media will change the landscape of the industry going forward.
iv. Are There Existing Niches in the Industry? If YES, List them
No, there are no niche ideas in the travel agency business.
v. Can You Sell a Franchise of your Business in the Future?
Mason Gray™ Travel Agency, Inc. has plans to sell franchises in the nearest future and we will target the United Kingdom, Canada, and Australia.
- The arrival of new travel agencies within our market space
- Low demand during the pandemic will reduce industry profitability.
- Economic uncertainty
- Liability problems
- The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
i. Who are the Major Competitors?
- The American Automobile Association (AAA)
- American Express
- Avenues of the World Travel
- Beachfronts Travel
- Frosch Travel
- En Route Travel
- MK All Around Travel, Inc.
- CruiseOne, Hargarther, Thaler & Associates LLC
- Independent Agency of Avoya Travel
- Cary Travel Express
- Frosch Travel
- CWT Vacations
- Connie Lemmon Travel, an Independent Agency of Avoya Travel
- LoBracco Travel, LLC, an Independent Agency of Avoya Travel
- World Travel
- First in Service
- Bluegreen Travel Services
- CruiseOne – Gary E. Smith & Associates
- My Paradise Planner.
ii. Is There a Franchise for Travel Agency Business? If YES, List them
- The American Express Company
- Cruise Planners
- Dream Vacations
- Travel Leaders
- Expedia Cruises
- Results! Travel
- Tix Travel & Ticket Agency
- Expedia CruiseShipCenters.
iii. Are There Policies, Regulations, or Zoning Laws Affecting Travel Agency Business?
There are no county or state regulations and zoning laws for travel agencies. Players in this industry are expected to work with the existing regulations governing such business in the county or state where their business is domiciled.
a. Who Is Your Target Audience?
i. Age Range
Our target market age range covers people that are 18 years and above.
ii. Level of Educational
We don’t have any basic educational qualifications for those who we are targeting; everyone is welcome to do business with us.
iii. Income Level
Anyone who can afford our service fee will be welcome to make use of our travel agency.
There is no restriction when it comes to the ethnicity of the people that will patronize our travel agency.
There is no restriction when it comes to the language spoken by the people that will patronize our travel agency.
vi. Geographical Location
Anybody from any geographical location is free to do business with us.
Mason Gray™ Travel Agency, Inc. will not restrict any customer based on their lifestyle, culture, or race from doing business with us.
b. Advertising and Promotion Strategies
- Host Themed Events That Catch Attention.
- Tap Into Text Marketing.
- Use FOMO to Run Photo Promotions.
- Share Your Events in Local Groups and Pages.
- Turn Your Social Media Channels into a Resource
- Develop Your Business Directory Profiles
- Build Relationships with Other Businesses in Your Area
i. Traditional Marketing Strategies
- Marketing through Direct Mail.
- Print Media Marketing – Newspapers & Magazines.
- Broadcast Marketing -Television & Radio Channels.
- OOH, Marketing – Public Transits like Buses and Trains, Billboards, Street Furniture, and Cabs.
- Including direct sales, direct mail (postcards, brochures, letters, fliers), print advertising (magazines, newspapers, coupon books, billboards), referral (also known as word-of-mouth marketing), radio, and television.
ii. Digital Marketing Strategies
- Social Media Marketing Platforms.
- Influencer Marketing.
- Email Marketing.
- Content Marketing.
- Search Engine Optimization (SEO) Marketing.
- Pay-per-click (PPC).
- Affiliate Marketing
- Mobile Marketing.
iii. Social Media Marketing Plan
- Start using chatbots.
- Create a personalized experience for our customers.
- Create an efficient content marketing strategy.
- Create a community for our target demography.
- Gear up our profiles with a diverse content strategy.
- Use brand advocates.
- Create profiles on the relevant social media channels.
- Run cross-channel campaigns.
c. Pricing Strategy
When working out our pricing strategy, Mason Gray™ Travel Agency, Inc. will make sure it covers premium, skimming, economy or value, and penetration. All our pricing strategies will reflect;
- Cost-Based Pricing
- Value-Based Pricing
- Competition-Based Pricing.
Sales and Distribution Plan
a. Sales Channels
Our channel sales strategy will involve using partners and third parties—such as referral partners, affiliate partners, managed service providers, marketplaces, or value-added resellers—to market our travel agency.
Mason Gray™ Travel Agency, Inc. will also leverage the 4 Ps of marketing which are place, price, product, and promotion. By carefully integrating all these marketing strategies into a marketing mix, we can have a visible, in-demand product or service that is competitively priced.
b. Inventory Strategy
Mason Gray™ Travel Agency, Inc. will operate an inventory strategy that is based on a day-to-day methodology for ordering, maintaining, and processing items in our warehouse. We will develop our strategy with the same thoroughness and attention to detail as we would if we were creating an overall strategy for the business.
c. Payment Options for Customers
Here are the payment options that Mason Gray™ Travel Agency, Inc. will make available to her clients;
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Return Policy, Incentives, and Guarantees
Mason Gray™ Travel Agency, Inc. will operate a refund policy but it will be dependent on the service providers we are working with. Please note that service providers such as hotels, airline companies and taxi companies et al will determine the kind of return policy we will operate. Aside from the above, we will be committed to giving out incentives to our loyal customers.
e. Customer Support Strategy
Our customer support strategy will involve seeking customer feedback. This will help us to provide excellent customer service, and understand the needs, experiences, and pain points of our customers. We will make use of effective CRM software to be able to achieve this.
We plan to expand our revenue by 50 percent in the second year and the plan will include a marketing, sales, and operations component. The operations component of the plan would include organizing regular giveaways and other incentives. These strategies will enable the firm to boost our service offerings and support revenue growth.
a. What Happens During a Typical Day at a Travel Agency Business?
- The office is open for the day’s work
- The walk-in areas, chairs, and tables are properly arranged
- Walk-in customers are attended to
- Deliveries of visas, flight tickets, and hotel bookings are made
- Reports are written and submitted to superior officers
- The facility is administratively closed for the day.
b. Production Process (If Any)
There is no production process when it comes to the travel agency business.
c. Service Procedure (If Any)
When a travel agency is opened and everything is in place, customers either come in to request the services they want or they call or email the travel agency. Once the request is gotten and the service fee is agreed upon, the travel consultant goes to work to deliver on all agreements.
Please note that the travel agency will handle all aspects of travel and tour-related businesses such as booking flight tickets, securing transit visas, booking shuttle buses/taxi cabs, car rentals, hotel bookings, and cruise line bookings amongst many other services.
d. The Supply Chain
Mason Gray™ Travel Agency, Inc. will rely on trusted agents to supply some of the needed supplies (foreign currencies) and we have been able to establish business relationships with key stakeholders in the industry.
e. Sources of Income
- Travels and Tours consulting and advisory services
- Selling traveling-related insurance policy cover, guide books, and foreign currencies
- Booking for flight tickets
- Securing transit visas
- Booking for shuttle buses/taxi cabs
- Car rental services
- Hotel bookings
- Cruise line bookings
a. Amount Needed to Start your Travel agency Business?
Mason Gray™ Travel Agency, Inc. would need an estimate of $150,000 to successfully set up our travel agency in the United States of America.
b. What are the Cost Involved?
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $7,300.
- Marketing, Branding and Promotions – $5,000.
- Business Consultant Fee – $2,500.
- Insurance – $5,400.
- Rent/Lease – $70,000.
- Other start-up expenses like commercial satellite TV subscriptions, stationery, phone, and utility deposits ($2,800).
- Operational Cost (salaries of employees, payments of bills et al) – $30,000
- Store Equipment (cash register, security, ventilation, signage) – $4,750
- Website: $600
- Opening party: $3,000
- Miscellaneous: $2,000
c. Do You Need to Build a Facility? If YES, How Much Will it Cost?
Mason Gray™ Travel Agency, Inc. will not build a new facility for our administrative office; we intend to start with a long-term lease and after 5 years, we will start the process of acquiring our own facility.
d. What are the Ongoing Expenses for Running a Travel agency Business?
- Utility bills (gas, internet, phone bills, signage and sewage et al)
- Maintenance of facility
- Salaries of employees
e. What is the Average Salary of your Staff?
- Chief Executive Officer – $62,000 Per Year
- Admin and HR Manager – $42,000 Per Year
- Travels and Tours Consultant – $40,000 Per Year
- Marketing and Sales Executive $40,000 Per Year
- Accountant – $38,000 Per Year
- Customer Care Executive / Front Desk Officer – $32,000 Per Year.
f. How Do You Get Funding to Start a Travel Agency Business
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
- Source for soft loans from your family members and friends.
a. How Much Should You Charge for your Service?
The amount traveling agencies charge their clients depends on the type of services rendered and the commission that the third-party provider is willing to give.
b. Sales Forecast?
- First Fiscal Year (FY1): $250,000
- Second Fiscal Year (FY2): $750,000
- Third Fiscal Year (FY3): $1.2 million
c. Estimated Profit You Will Make a Year?
Mason Gray™ Travel Agency, Inc. is projecting to make;
- First Fiscal Year (FY1): (50% of revenue generated)
- Second Fiscal Year (FY2): (45% of revenue generated)
- Third Fiscal Year (FY3): (45% of revenue generated)
d. Profit Margin of a Travel Agency Business
Travel agents’ commissions used to be the bulk of their income but that has shifted. Most travel agents who earn commission by booking tickets on airlines earn 5 percent on domestic flights and 10 to 20 percent on international flights. The commission rates are similar for booking hotels.
a. How do you intend to grow and expand? By opening more retail outlets/offices or selling a Franchise?
Mason Gray™ Travel Agency, Inc. will grow by first opening other offices in key tourist cities in the United States of America, the United Kingdom, and Australia within the first five years of establishing the business and then will start selling franchises from the sixth year.
b. Where do you intend to expand to and why? (Geographical Locations)
Mason Gray™ Travel Agency, Inc. plans to expand to:
- Los Angeles, California
- Long Beach, Washington
- Newport, Rhode Island
- Chicago, Illinois
- Clearwater, Florida
- Portland, Maine
- Orange Beach, Alabama
- Ocracoke, North Carolina
- Block Island, Rhode Island
- New York City, New York.
Internationally, we plan to expand to Canada, the United Kingdom, and Australia.
Mason Gray™ Travel Agency, Inc. intends to build a family business hence our exit plan will be family succession. For that reason, the founder Mason Gray is already grooming his son Merrick Gray to take over from him. Merrick Gray is at the moment being groomed to go through the company’s employment process without any bias.