Travel Agent

How Profitable Is A Travel Agent? (Updated for 2024)

Pat Walls

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Updated: October 6th, 2024

How Profitable Is A Travel Agent? (Updated for 2024)

So you want to start a travel agent?

And the first question that came to your mind was, “well, are travel agents actually profitable?”

With a market size of $540B - there’s plenty of business to go around.

Especially considering:

You could start a travel agent with as low as $1,500
Based on our data, travel agents generate an average of $6.59M per year
You could see gross margins as high as 20% with travel agents

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a travel agent.

Let’s dive in!

Is a travel agent profitable?

Yes, a travel agent is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $6.59M per year with an estimated gross margin of 10%, you could expect to recover your investment within 25 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your travel agent.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your travel agent is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is a travel agent worth it?

If you’re wondering if a travel agent is worth it, the answer is a big YES. With travel agents, you have the potential to earn $6.59M per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $540B, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a travel agent to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful travel agents case studies.

Examples Of Profitable Travel Agents

Here are a few examples of profitable travel agents, and a few more details about them:

1. Baboo Travel ($3.6M/year)

Paul Sarfati, the Founder and CEO of Baboo Travel, came up with the idea for his business after experiencing the decline of his previous travel company, Bamba Travel, due to the pandemic. Wanting to create a platform that offers customized trips and connects travelers directly with local experts, Sarfati drew inspiration from companies like Evaneos. With his extensive knowledge of the travel industry and a focus on creating a better business model, Sarfati aims to revolutionize the travel industry and provide customers with personalized experiences at better prices.

Is it profitable? Yes
What's the gross margin? 20%
How much money it makes: $3.6M/year
How much did it cost to start: $650K

My Travel Hobby Fueled Me To Build A $600K/Year Custom Trips Platform

Baboo Travel's CEO Paul Sarfati successfully launched an easy-to-use travel platform that connects customers with local in-destination travel experts, reaching $180,000 in sales in the first four months of launching through targeted marketing strategies, incorporating growth hacking techniques, and prioritizing content marketing and search engine optimization for long-term success.

Read this case study

Read by 5,567 founders

Learn more about starting a travel agent:

Where to start?

-> How much does it cost to start a travel agent?
-> Pros and cons of a travel agent

Need inspiration?

-> Other travel agent success stories

Other resources

-> Email templates for a travel agent

How much can you make with a travel agent?

With a travel agent, you can make an average of $6.59M revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $1,500. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 25 months.

How much does a travel agent make a week?

Based on our data, average weekly revenue for a travel agent ranges around $137K. As such, you could see monthly revenues of $550K.

To know if your travel agent achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your travel agent.

How much do travel agents owners make?

The income of a travel agent owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established travel agent is about $137K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as a travel agent owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Travel Agent Profit Margins

Generally speaking, a travel agent can expect profit margin of around 10%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of a travel agent, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, travel agent owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, travel agent owners can ensure long-term sustainability and profitability for their business.

Travel agent owner salary

The salary of a travel agent owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established travel agent, in a prime position, might see an average weekly salary around the ballpark of $13.7K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a travel agent may be a promising business to start - but the success of your travel agent mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable travel agent.

Part of

Becoming A Travel Agent: Everything You Need To Know

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