What are the requirements that need to be completed to start your travel agency?
Before establishing and introducing business in the market, some factors need to be taken into consideration. These factors include the current situation of the economy, the expected growth of your organization, its’ expected profitability and the level of competition that you might have to face. Considering all of these factors is important because they will help you make all the important decisions about your business before you even start it, which will help it in growing and being successful in the future. Similarly, other than these important factors that need to be taken into consideration, many other factors have also been to be considered which include all the legal formalities that need to be completed. First and foremost, you need to understand and study the different options that you have of different business structures. This is important because the structure of your travel agency will help you in evaluating the taxation system of your business.
The two most common business structures in the world of travel industries include a limited liability company, LLC, and a sole proprietorship. Most of the people who are considering opening a travel agency of their own are usually attracted more towards the option of a limited liability company. The main reason for that is that the owner of a limited liability company can be shared and you can go into partnership with 2 to 20 other parties. Another major benefit of starting a limited liability company is that you don’t have to bear the losses on your own and they are shared amongst all the parties that are involved. However, on the other hand, a slight disadvantage is that the profits of a limited liability company are also shared. A sole proprietorship business is the one in which the ownership of the business belongs to a single person. For some people, who want to start on a smaller scale, it is considered to be a safer and easier option because it does not require a lot of legal formalities that need to be taken care of. Another advantage of a sole proprietorship is that you can start small and as your business starts to grow, and as it gets more profitable, you can expand it by turning it into a limited liability company. An employee identification number, EIN, however, is required to start a sole proprietorship.
Getting your bookings done or planning your trip through a travel agency is not a very big hassle these days since a lot of the process that goes into it has been made easier for us and a lot of hassle has been taken care of. However, there is a lot that goes into a travel agency before it is successfully established in the market and before it starts earning profits that you could enjoy. Your travel agency should be recognized and established through certain institutions and organizations before can be established. These organizations include The Airline Reporting Corporation and International Airlines Travel Agents Network. The International Airlines Travel Agents Network has been more popular amongst the travel industries over the past 25 years approximately, however it does charge an annual fee of approximately 195 American dollars.
As mentioned above, one of the major advantages of having an organization that has the structure of sole proprietorship is that there are not many legal formalities that need to be completed to start your own business or establish your organization. Having that said, it is not necessary to be accredited by The Airline Reporting Corporation or the International Airlines Travel Agents Network. However, not being recognized by these organizations can cost you an arm and a leg in the long run. It is always a good idea to be recognized and accredited by these organizations because that way, the commission will be paid to you by the suppliers for booking the products or services being offered by them. However, your organization or travel agency will be required to make a certain amount of sales before it is accredited. This is the main reason why the majority of the new travel agencies usually start by working with a host travel agency. This means that the new travel agency enters into a partnership with a travel agency that has already been established in the market and is already accredited by The Airline Reporting Corporation or the International Airline Travel Agents Network.
Once all of these procedures have been taken care of, it is extremely important to market and advertises your travel agency appropriately so that you can generate demand for your organization. A good way of marketing and advertising your travel agency can be through getting your travel agency registered on TripAdvisor, Yelp, MakeMyTrip, and Google. Another helpful way can be social media advertising, which means advertising through different social media platforms such as Instagram, Facebook, and Twitter or asking your respective clients to post different reviews of the services they availed that are being offered by your travel agency.