business plan for online travel agency

Free Travel Agency Business Plan Template

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Okay, okay. I know you’re crazy thrilled that you’ve found a free travel agency business plan template for your agency! I promise we’ve got a super razzly-dazzly one that will help you craft THE BEST travel agency business plan out there. So we’ll have you download your free travel agency business plan template in just a second, and then we’ll walk you through the different pieces of the business plan in the article.

Sound like a (business) plan?!

What Is the Purpose of a Travel Agency Business Plan?

Here's a sneak preview of what you can expect from HAR's business plan below. (Need no convincing? Download it here .)

Business plans got their start as a way for banks to vet new businesses before deciding to give them a loan. After all, people that have thought long and hard about their business and taken the time to painstakingly write down all the steps and intricacies have a higher likelihood of success.

Now when it comes to travel agencies, you may think having a business plan is overkill or outdated. Sure, if you’re opening a storefront agency or a franchise you may need some capital from the bank/investor so a business plan may be a necessity. But now that most agencies are home-based, the median start-up cost for a non-franchise travel agency is $1,000 . If you’re not getting a loan, do you really need a business plan?

Where did that $1,000 number come from? Not from thin air . . . find HAR's data here!

If you’re starting a travel agency, here’s a few reasons why creating a travel agency business plan might be helpful to you:

• Practical: it will help you feel prepared and confident as you make important business decisions.
• Inspirational: it will help remind you what it is that inspired you to start a travel agency and what kind of impact you hope to have on your clients. The kinds of things that will remind you why you started all these shenanigans when logistical tasks like taxes get boring or complicated.

The other thing a travel agency business plan can do? It will help you describe your agency—the service you provide (do you have a niche?), the market in which you’re operating, the money you need to get started and keep going, and the people you need to help you get there (accountants? Sub agents? Bookkeeper? Web Developer?) In short, it can help you feel prepared and confident, and our free travel agency business plan is going to help you with that!

Download HAR’s Free Travel Agency Business Plan Template

We have a handy dandy (and free) travel agency business plan template for YOU, dear reader! Yay, it is the companion to this article.

We’re offering our travel agency business plan template free (no catch) because we want your new business to be off to the best start possible!

Alright, now you’ve downloaded our free travel agency business plan template, great! We’ve already filled it out for our fictional travel agency, Corona Travels , and now we need to work on personalizing this business plan to your travel agency.

To update your personal business plan template with your brilliant ideas, all you'll need to do is delete the sample description provided in the template and add in your own material! In the next section, we walk you through each part of the business plan. I recommend that as you read through the article, you compare the sections of the travel agency business plan template. That way, you'll have an explanation for each part with an example.

Let’s jump in and start tailoring the business plan template to your travel agency!

Hold up. Still need to get your agency set up? We have just the thing.

Now, a business plan template may feel like you're getting ahead of yourself if you haven't named and/or registered your business yet! If you still need to take strides to get your agency off the ground (your agency, name, niche, registration, host affiliation etc.) we have a course that will fast-forward that process.

Check out HAR's 7 Day Set Up Accelerator course to get your agency set up faster so you can start monetizing sooner! The course is written and taught by HAR Founder, Steph Lee, and professional Educator, Bridget Lee. It includes nine chapters with 70+ instructional videos, course quizzes, peer accountability, and monthly meet-ups with HAR members and industry experts.

Now, let's go over the business plan!

Travel Agency Business Plan, Part 1: Overview

The overview is like an executive summary that briefly summarizes all aspects of your travel agency business plan. You can think of this as the “elevator pitch” of your travel agency business plan. Oddly enough, I like to do these summaries last, since then you’ll have all the info at your fingertips that you'll need to summarize.

So what details are you filling out in this first part of the travel agency business plan?

• Name of Your Business: Not sure what your travel agency name is yet? We can help you with that .
• Location: Is it your house? A PO box? A storefront? Your sister’s basement?
• Your Travel Niche: Specializing as a travel agent is more important than ever. Selling travel is about much more than booking. It’s also about bringing knowledge, expertise, access, and resourcefulness to the table—all the qualities that help separate you from an OTA (online travel agency).

Read here if you want help developing a niche of your own!

• Your Target Client: Luxury? Families? LGBTQ? Cruisers? Boomers or Millennials? Honeymooners? Foodies? Who do you imagine your client to be and how will this shape the way you develop your travel agency?
• Your Competition: Another way to look at this is, who are your industry peers? What might your customers consider if they don’t use you as a travel agent? (Try to think beyond OTAs like Expedia.)
• The expertise of Management Team: Okay, so your management team might be you and the office dog (we know who’s the alpha in the office!). But even if that’s the case, this section is an opportunity to reflect on your strengths as a travel agency owner.
• Financial Projections: Unless you’re coming into the industry with a book of business, this might seem intimidating. It’s hard to know what to expect right? But the good thing is we have an amazing resource for you: “ Travel Agency Startup Costs and Earnings: What to Expect ” Wow! Who knew?!
• Travel Agency Mission Statement: This will help you remember why you did this in the first place, and remind you what kind of impact you hope your business will have on others! Warm fuzzies, right?!

And hey, we’re done with Part 1!! Just like that. ;)

I know you can barely contain your excitement to start reading about our next section, business foundations !

Travel Agency Business Plan, Part 2: Business Foundations

This section of your travel agency business plan provides background information on your agency. If you’re brand-spanking new, much of this information will be provided in the overview. If your business has roots, it may be a little more complex.

This section can include:

• Legal Structure : What type of business is your agency? LLC? Sole Prop? S Corp? Has it changed over time?

If you are just starting and aren’t sure what type of business you want, check out this resource on how to choose a travel agency business structure

• Agency Founders and Their Role in the Formation of Your Travel Agency : Who are the founders and what are their roles?

Ah, that was a nice and easy section, wasn’t it? Now we need to start getting real. Yes, folks, the well-loved travel agency business plan template goes OCD in the next section!

Travel Agency Business Plan, Part 3: Product or Service

This section is where the rubber hits the road with your niche and will help you begin to think about developing preferred supplier relationships with your travel agency.

• Products/ Services Provided: This may seem obvious—you sell travel! But if you’re considering providing other services (even if it’s a future goal), it will be important to consider that too. In addition to planning and booking travel, this may include: Coaching clients to book their own trips; trip consultations; wedding planning; providing education, training or mentorship to other agents; facilitating educational webinars (etc.); speaking at industry events.
• Sales Projections: This is hard if you haven’t booked any travel yet. But consider what kind of travel you want to sell. How many clients are you booking? How many trips do you aim to sell weekly/monthly/annually?

This is a good opportunity to make financial goals for your travel agency. What kind of annual income are you aiming for? How much would you have to sell in one year to reach that?

If you are providing multiple services as a part of your travel agency business, what is the breakdown among those different services?

You can see how Madeline Jhawar breaks down her earnings by services in this article here

• Industry Projections for Your Travel Services: We’ve done a lot of legwork for you on this one in our travel agency business plan template. But, if you want to add more, imagine this as describing the industry viability to someone who is not within the industry. What influences demand for your travel services? How is the health of the travel industry overall? Check out HAR's latest income survey results !

Now that you’ve dug into the details in this section, let’s move into the next section of your travel agency business plan that doesn’t tax your brain. It’s about management structures and it’s equal parts easy and boring (#honest).

Travel Agency Business Plan, Part 3: Management Structures

This will be a very fast exercise if you are opening your agency alone :). If you’re working for yourself, you may also want to consider outside organizations that influence your business:

• If applicable, which host agency/franchise do you belong to?
• If you or your host belongs to a consortium, which one?
• What travel organizations are you a part of? (i.e. ASTA, IGLTA, PATH, CCRA etc.)
• Since you are an independent agent, these outside organizations won’t have a direct stake in your business, but they may influence your day-to-day operations in some way.

If you're flying solo, you can probably stop here! But if you have or want to take on sub agents or employees you’ll want to do the above, and you’ll also need to go into more depth with your travel agency management structure below:

It’s important to avoid misclassifying employees as independent contractors because it can get you in deep trouble with IRS. Read up here to learn the difference .

• If applicable, create an organizational chart of your travel agency. You can think of this as a business version of a family tree. This will help you visualize who the players are and what roles they serve to your agency.
• What value do the different management positions add to your travel agency?
• What are the responsibilities of their positions?
• Describe other ICs or employees/ positions and their responsibilities. How will they complement what you do for your agency? (i.e. Sell a different type of travel under your brand? Work on sales? Bookings only? Administrative assistant?)
• If you have sub agents or employees, break down overall payroll expenses. What is their compensation? A commission split? A base salary? A combination of the two? Will you provide any bonuses or benefits if you have employees?
• Do you anticipate future additions to your staff?

Phew! That was a long one. Well, you certainly nailed it. Kudos!

Travel Agency Business Plan, Part 3.2: Who Is Your Office Mascot?

This is probably the most important factor in building a business plan. How the heck are you going to get up and work every morning without a dog pushing their cold nose into your face, or a cat trying to use your neck as their personal radiator?

Still with me? Okay, no more goofing off. Just wanted to throw in a fun interlude . . . I’ll get back to business now.

Travel Agency Business Plan, Part 4: Marketing Strategy

This section of your travel agency’s business plan will help you clarify some of your marketing goals in the long term.

• Who are your major clients? Include names, location, and what kind of travel they prefer. What was the sales volume for each customer? Have they provided referrals for your business?
• Who are prospective clients? Who might be other potential travel clients for you? Parenting class members? Your yoga class? Regulars at your favorite bookstore? Do you have a way to informally see how they might respond to your travel services?

Marketing Plan

What is your marketing plan? Consider things such as:

• Your pricing. For example, if you want to charge fees.

Not sure where to start with fees? Go here first

• How do you want to market to clients? Online, at wedding expos, in line at the grocery store?
• What region do you want to target and if you want to target clients outside your locale, how do you plan to do so?
• What is the flow of your services during planning, travel and post-trip? How do you plan on getting feedback from your customer once the travel is complete?

We have a few forms resources to help you with your workflow!

• What are your marketing priorities ? Networking? Referral? Online? Social media?

If you’re not sure where to start, this is the way into our rabbit hole of marketing resources .

• Sales Strategy: Now that you have a list of potential clients and a marketing plan, how will you reach out to prospective clients? Host a cocktail hour? Send a mailing? Go to networking meetings? Do you need to outsource or delegate any tasks to help you with your sales efforts?

Are you ready to head on over to that travel agency business plan template you have a love-hate relationship with? Good, because you’re gonna read all about Corona Travels marketing strategy and how they plan on closing the leads they get . . . and maybe you can steal some of Sol’s ideas for your agency. :)

Travel Agency Business Plan, Part 5: Technology

What kind of tech do you need to help your agency get up and running, and what technology will you need to keep your travel agency machine humming? You don’t need everything at once, but you’ll want to have an idea of what you need to reach some travel agency milestones you’re going for.

You might want to consider things like:

• Travel Agency Website
• Read up on different website options for agencies
• Customer Relations Management (CRM):
• ClientBase Online
• Online Scheduling Tools:
• Itinerary Builders:
• Axus Travel App
• Payment Processing (for fees)
• Quickbooks Payments (use this link for 50% off first SIX months -- normally it's 3 months)
• TESS (built into CRM)
• Travel Joy (built into CRM)
• WixPayments
• Bookkeeping and Accounting
• Google Sheets ( part of Google Workspace )
• Mac Numbers
• Quickbooks Online / Quicken (use this link for 50% off first SIX months -- normally it's 3 months)
• Quickbooks Online (use this link for 50% off first SIX months -- normally it's 3 months)
• Booking tools
• Google Workspace : We have an exclusive 10% off promo code for Google Workspace! Just fill out the form and we'll send you the code.
• Office equipment
• Fax: FaxZero
• Scanner: Scanner Pro ($3.99 in Apple App Store)
• Scanner: Tiny Scanner (Google Play Store)
• Business Card Scanner: CamCard (Free on Apple App Store | .99 on Google Play Store )
• Forms / E-signatures*
• JotForm (free plan allows e-signatures)
• RightSignature
• Email Automation
• Sendinblue (that's what we currently use, and I highly recommend it!)
• Active Campaign
• Constant Contact
• Online Meetings / Video Conferencing
• Google Meet (part of Google Workspace )
• Secure Password Manager (also known as The Handiest Thing Ever )
• Mileage Tracking
• MileIQ (Free but if you ever decided to upgrade, use this link for 10% off paid plans)

Just because it’s technology, it doesn’t mean it has to be state of the art or über fancy. You can pick and choose where you want to allocate your financial resources on tech: I’ve spoken with several travel agents who swear by a combination of sticky notes, physical calendars, and Excel spreadsheets.

Think about which of these technologies you really need. If you go with a host agency or consortium, which of these technologies do they provide? Looking forward as your business grows, which technologies do you anticipate you’ll want to phase in?

Choosing those technologies was fun, wasn’t it? But now we need to iron out how you’re going to run the agency. So let’s move into the next section of your travel agency’s business plan template and make sure you’re running a tight ship!

Travel Agency Business Plan, Part 6: Operations

Developing a plan for travel agency operations will help you understand how to ensure your business runs smoothly, in addition to understanding the capacity of your travel agency. For this section of your travel agency business plan you’ll want to consider:

• What is your sales volume compared to your sales capacity? How much travel can you actually sell in the time you want to spend working to sell travel?
• Who are your preferred suppliers? Who are your host or consortium’s, preferred suppliers? How do these suppliers (and your host) disburse commissions and on what timeline? How does this impact your bookkeeping and workflow?
• If you are booking groups, plan ahead. Are there any special cruise sailings or new ships you want to block space for? Is a resort opening a new property that you’re excited about and might be in high demand? Is there a new exciting product coming up that you want to get ahead of?
• In order to find out about some of these opportunities, what travel publications do you want/ need to subscribe to? (*Ahem* Make sure HAR is one of them!!) How are you utilizing your host or consortium resources to stay ahead?

OMG. OMG!!! That’s right, keep that grin plastered on your face because we’re entering the final leg. You did it!

Travel Agency Business Plan, Part 7: Administrative Support

As a business owner, there will be a lot of external organizational support as you go. First, we’ll focus on financial logistics. What are the business names (or contacts) and addresses of some of your administrative support? This may include:

• Your bank/ banker
• Accountant and/or Bookkeeper
• Host agency or consortium
• Legal counsel/ lawyer

See our updated list of travel industry lawyers here!

Congratulations. You Have a Travel Agency Business Plan!

Seriously, that was INTENSE. Give yourself a huge pat on the back. Creating a business plan for your travel agency ain’t for the faint of heart, but you did it.

Go ahead and tell us about your process. Was our free travel agency business plan template helpful? Did it help to think things through and write a business plan for your agency? Was it a waste of time? Most importantly, what kind of office pet do you have and what sort of moral support do they provide?

Comment below!

*Editor's Note: This article was originally published on April 16th, 2019. We updated it on the publish date listed on the article!

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Travel Agency Business Plan Template

Written by Dave Lavinsky

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their travel agencies. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a travel agency business plan template step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Travel Agency Business Plan?

A business plan provides a snapshot of your travel agency as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Travel Agency

If you’re looking to start a travel agency or grow your existing travel agency you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your travel agency in order to improve your chances of success. Your travel agency business plan is a living document that should be updated annually as your company grows and changes.

Source of Funding for Travel Agencies

With regards to funding, the main sources of funding for a travel agency are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

The second most common form of funding for a travel agency is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan.

Finish Your Business Plan Today!

Your travel agency business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of travel agency business you are operating and the status; for example, are you a startup, do you have a travel agency that you would like to grow, or are you operating a chain of travel agencies.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the travel agency industry. Discuss the type of travel agency you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of travel agency you are operating.

For example, you might operate one of the following types:

• Commercial Travel Agencies : this type of travel agency caters to business travelers. These agencies specialize in tracking down deals for business travelers to help companies manage travel costs.
• Online Travel Agencies : this type of travel agency exists only in cyberspace. They provide clients with the convenience of online booking and discounts that are available only to professional travel agencies.
• Niche Travel Agencies : this type of travel agency provides clients with specialized knowledge of a region.
• Membership Associations : Memberships associations give travelers access to the organization’s travel planning services for the cost of an annual membership rather than charging per transaction. This type of agency offers the most benefit to frequent travelers.

In addition to explaining the type of travel agency you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new location openings, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the travel agency business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the travel agency industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards glamping, it would be helpful to ensure your plan calls for plenty of luxury camping packages.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your travel agency business plan:

• How big is the travel agency business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your travel agency. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your travel agency business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: sports enthusiasts, soccer moms, baby boomers, businesses, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of travel agency you operate. Clearly baby boomers would want a different atmosphere, pricing and product options, and would respond to different marketing promotions than businesses.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most travel agencies primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other travel agencies.

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes customers making travel arrangements themselves at home. You need to mention such competition to show you understand that not everyone who travels uses travel agency services.

With regards to direct competition, you want to detail the other travel agencies with which you compete. Most likely, your direct competitors will be travel agencies located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide better travel packages?
• Will you provide products or services that your competitors don’t offer?
• Will you make it easier or faster for customers to book your offerings?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a travel agency business plan, your marketing plan should include the following:

Product : in the product section you should reiterate the type of travel agency that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to regular accommodation and transportation booking, will you offer items such as tour packages and excursions?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the packages you offer and their prices.

Place : Place refers to the location of your travel agency. Document your location and mention how the location will impact your success. For example, is your travel agency located next to a heavily populated office building, or highly trafficked retail area, etc. Discuss how your location might provide a steady stream of customers.

Promotions : the final part of your travel agency marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your travel agency’s storefront extra appealing to attract passing customers
• Distributing travel brochures outside the travel agency
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Social media advertising
• Local radio advertising
• Banner ads at local venues

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your travel agency such as serving customers, procuring supplies, keeping the office clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 1,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

To demonstrate your travel agency’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the travel agency business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in travel agencies and/or successfully running retail and small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 50 customers per week or 100? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your travel agency, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a travel agency:

• Location build-out including design fees, construction, etc.
• Cost of equipment like computers, website/platform, and software
• Cost of marketing materials and maintaining an adequate amount of supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Travel Agent Business Plan Template PDF

You can download our travel agent business plan PDF to help you get started on your own business plan.  

Travel Agency Business Plan Summary

Putting together a business plan for your travel agency is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the travel agency business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful travel agency.

Don’t you wish there was a faster, easier way to finish your Travel Agency business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.  

Click here to see how Growthink’s business plan consulting services can create your business plan for you.

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Key Steps to Focus on When Building an Online Travel Agency

Online travel agencies (OTAs) spearhead the digital transformation in travel in recent years. They firmly occupy the majority share of the modern digital travel market (over 39 % according to Phocuswright). They’ve earned it by offering a great combination of rich travel service supply and the ‘one-stop-shop’ booking experience delivered via high-end web portals and mobile applications.

The growing demand for OTA services has naturally made this market a tempting target for aspiring entrepreneurs and startups. However, every new business has to face severe competition that first of all comes from the big brands. The likes of Booking Holdings or Expedia are dominating entire markets. For example, in the USA these two companies hold a commanding market share of 92% . Peer startups are also putting pressure, with new OTA projects popping up every day in different parts of the world. So, how does one stand out and gain ground in this very promising but equally challenging market?

Let’s try to answer this question together. In this article, we outlined the key steps one should focus on when starting a brand new OTA business. It also contains our ideas and recommendations on better ways to handle each step based on years of experience supplying technology solutions for travel startups, including new OTA businesses.

Don’t know where to start with your OTA technology? We are here to help!

Step 1. Finding your market

Just as any journey starts with choosing your destination, a new OTA usually begins with opting the market to operate on. At this stage, it is necessary to run a careful analysis and build an all-round understanding of your market and potential clients. It is important to consider various aspects, such as:

• Geographic focus (worldwide, regional, nationwide, etc.);
• Target audience and its preferences;
• Types of travel products to sell (hotels, flights, packages or other), etc.

Finding niche markets is generally a working approach with the account of its success rate and the current state of affairs in the OTA market. First of all, it offers an adequate response to the competition forced upon startups by bigger OTAs. Niche businesses can offer unique experiences that are tailored to the needs and expectations of specific limited customer groups. Secondly, it is a reasonable way to avoid overspending on marketing while securing good conversion rates thanks to more targeted outreach.

However, the mere choice of your niche can already become quite a challenge in itself. There are just so many options to consider! It makes good sense, in this case, to narrow down your list of options by leaving just the most promising at the moment and ideally in the foreseeable future. Here is a list of ‘hottest’ travel niches as of 2023 according to trustworthy travel industry sources:

Nomadic travel

COVID-19 made it clear for the whole world – remote work works! Employees are more and more inclined to escape offices and work from anywhere around the world. This trend skyrocketed during the pandemic and is not likely to fade away in the coming future. It offers amazing opportunities for creation and marketing of targeted travel products.

Multi-generational escapes

The social isolation enforced by governments worldwide separated family members from one another for long spans of time. Now as the borders are open, the demand for vacations involving multiple generations of the same family is quite likely to boom.

Social impact travel

Sustainable tourism is also a steadily growing trend in travel. It focuses on travel experiences involving activities that serve various social causes. Tourists are getting increasingly more concerned about how their journeys can be beneficial to local communities in post-pandemic times.

Motorhome travel

Also known as campervan tourism, RV or mobile home travel, etc. Thousands of people will certainly explore this type of travel in 2023. A large portion of them – for the first time. It delivers a truly unique combination of travelling freedom and social distancing.

Virtual reality (VR) tourism

With the IT industry booming worldwide, this is an interesting niche to explore. VR technology is a great way to offer an immersive experience of vacations to remote places of the world without leaving your own country.

Step 2. Travel accreditation

Accreditation is a unique number assigned to travel professionals in recognition of business trustworthiness. It is of major importance for making an OTA project successful. First of all, it permits you to book travel, receive commissions, and – with some accreditations – issue airline tickets with the most established travel suppliers. Secondly, it is a powerful tool for building trust and credibility in the travel market.

International Air Transport Association (IATA)

IATA identification number is worldwide recognition of your expert status in travel. It also brings lots of other benefits, such as access to the best prices from around 250 airlines and a unified interface for billing and payment transactions with suppliers.

With all the perks, no wonder it is in the highest demand and really hard to get. It normally takes months of expectation prior to getting your approval. But before that, you need to demonstrate considerable experience in travel, obtain a business license and also fulfill a set of other important criteria. All these complex requirements naturally make IATA a hard target for new businesses. But the benefits it brings definitely make it worth all the effort.

Airlines Reporting Corporation (ARC)

ARC is a US-only accreditation for travel agencies. Similar to IATA, it offers access to over 200 network operators and tools, as well as programs for credit card processing and anti-fraud services. There are three levels of accreditation offered by ARC for various purposes. The traditional option does not require any prior experience in this field. However, there is the ARC Specialist exam that needs to be passed by one of the employees. It increases the costs and the waiting time to get your ID.

The high filing price combined with annual fees, as well as the strict application process, including interviews with the agency owners again really can create overwhelming obstacles for new OTAs. But just like IATA it opens up great prospects and can serve as a source of trust and credibility for your business on the market.

Travel Retailer Universal Enumeration (TRUE)

TRUE accreditation is a great option for businesses operating in the travel agent niche. There are two levels of accreditation available: travel agency accreditation (which covers up to 5 travel agents) or host agency accreditation (accommodates up to 25 agents). It is mainly focused on the U.S. market. However, it recently shifted its focus and is now committed to operate globally.

The main advantage of TRUE number is the possibility to closely work with smaller boutique tour operators that may not be the target audience for other prominent organizations offering accreditation in travel. Also, TRUE allows agents to interact with suppliers using net rates as an alternative to more common commission-based arrangements.

Cruise Lines International Association (CLIA)

This accreditation is relevant only for agencies that plan to sell cruises. As of 2022, it has been received by over 20,000 entities globally. It is the gateway to getting recognized by over 95 percent of the global cruise market. As soon as you’ve made up your mind to distribute cruise content, it is definitely worth applying for your CLIA ID.

CLIA membership requirements are not so strict. Basic membership won’t require any significant experience from you or an entrance fee (it can be required only if you go for the premium option).

Is accreditation a “must-have” for OTAs?

It definitely is if you wish to cooperate with a GDS for flight content. Sabre or Amadeus will for sure demand an IATA ID from you. In other cases, an accreditation would still be great, but not obligatory to own.

When it comes to flights, startup OTAs often choose flight consolidators initially. These are companies like TravelFusion , Mystifly , XML.Agency , PKFARE or others. Their business is based on buying large chunks of tickets from airlines at discounted (or ‘net’) rates and then reselling them to travel agencies. The end price for the latter is good enough to apply their own markups on top and still offer tickets to travelers at prices lower than the general market. The margins that agents earn on consolidator rates are usually lower compared to what they might count on with an IATA ID. But the time-to-market is much faster and there is no need to spend heavily on getting your accreditation in place.

Joining a host agency is another working option to enter OTA business without accreditation. It means you will operate under the umbrella of a travel company that already holds its own IATA ID. This is a relatively quick and convenient way to enjoy the key benefits accreditation has to offer, such as access to GDSs and lucrative airline rates. However, you will also need to comply with a certain set of qualification requirements (they may differ depending on the host) and pay fees for the host service.

Step 3. Financial planning

It is a common story for startup OTAs to have limited initial budgets. That is why it is crucial for them to invest carefully to make sure they get the most out of every penny. On the other hand, it is also extremely important to plan and monitor your revenues properly so you could manage and distribute available budgets with utmost productivity.

A meticulous and conscious approach at every project stage is the only way to handle this challenge successfully. With that said, there are certain aspects of business and techniques that are worth specific attention as they’ll benefit your project the most in terms of adequate budgeting.

Discovery phase

Preparation and planning is everything. This is exactly why a properly conducted discovery phase should be an obligatory step in your startup building process. It is composed of a series of activities to build a complete project vision, define the full development scope and, most importantly, draw up a well-balanced development budget. A discovery phase will help you to develop all-encompassing project estimates by approaching your project from both the business and technical perspectives – by far the only correct way to ensure reasonable financial planning.

Discovery and Analysis Service by GP Solutions

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Marketing expense management

Marketing is usually the heaviest expense item that often reaches 50% of the total project cost. It is vital to spend marketing budgets wisely – in a way that would secure a solid initial base of loyal customers.

Investing your budget in merely driving the traffic to your portal from all possible sources will almost certainly lead to failure. It would be much smarter to develop a sound customer retention strategy before launching any traffic generation campaigns. Not only will this approach secure higher conversion rates, but it can also reduce marketing expenses and release extra funds to spend on better software or customer service.

For example, it is possible to achieve good results with loyalty programs based on bonus points that can partially or fully cover the cost of a travel service. This is a crucial element for smaller businesses nowadays. It is very hard to compete with larger OTAs today without it. These programs can also be extended with volume discounts (for example, “7=6” on hotels), promocode distribution campaigns, etc. All these features can get almost fully automated, which means minimum manual effort from OTA staff.

Increased attention to non-air sales

85 % of gross OTA sales derive from air tickets while hotels represent only 14 percent, says the survey performed by Hermes Management Consulting company. That said, a more detailed consideration shows that a gross margin of hotel sales is nearly twice the amount of air sales margin – 12% against 6%. So, non-air sales represent a bigger growth opportunity for OTAs.

Step 4. Technological strategy

The entire OTA business concept heavily relies on modern online technology. It takes a complex technical infrastructure to launch an OTA. First of all, there has to be a high-performing and reliable booking engine at the core that would cover your booking flows for travel products – hotels, flights, activities, car rental services or any other you might want to sell. Next, it also needs to be extended with a number of important functional blocks, such as reservation management modules, an inventory system, business rules engine for markups and commissions, a structured API for productive data exchange via the B2C or B2B channel – and many more.

But the technical platform alone, however sophisticated, is not a 100% guarantee of success. Any implementation should be based on a reasonable strategy that can pave a much safer way towards a prosperous booking portal. Here’s a few practical strategic hints that can benefit the tech side of your OTA.

Take your time before you decide – custom or turnkey

This is one of the key dilemmas to go through before any implementation takes place. A bad decision here usually causes lots of trouble. There are different reasons why people choose wrong – over-focus on a particular option, bad planning, poor work on requirements… But haste is by far the most frequent reason of them all.

Take a few minutes to read this article from our blog for valuable guidelines that can help you make the right decision.

Start with an MVP

It is common practice for startups to first enter the market with a Minimum Viable Product, or MVP. It stands for a software version that offers just enough features for use by early customers who can provide valuable feedback for future product development. This technique is created to avoid excessive initial efforts. It allows to make sure that your core OTA concept really works before any full-scale development is launched.

Give more focus to mobile solutions

According to Research and Markets , the mobile travel booking market is expected to grow at an average rate of 12.2% between 2021 and 2029. This is higher compared to the CAGR of 10% that is forecast for the global OTA market until 2025. Markets like North America demonstrate the share of mobile bookings as high as 40% from the overall online market, with a further growth dynamic. All these figures suggest paying specific attention to the mobile UI of your portal. It is possible to start with a mobile web version or an adaptive layout first to keep initial efforts to a minimum. Native Android and IOS apps can be released at later stages. Anyways, mobile interfaces should be kept in order at all times.

*Source: Statista 2021

Step 5. Third-party integrations

No OTA website can operate as a fully closed independent system. Every modern online booking portal requires a number of integrations with external systems to perform its basic tourines – display travel product offers, process bookings, accept payments, generate performance for the management, etc.

Travel suppliers

An overwhelming majority of modern OTAs rely on 3rd-party suppliers for travel data. This group of entities combines various types of travel distribution platforms – GDSs, bedbanks, flight consolidators, other OTAs, etc. They are convenient to work with because they deliver content and confirm bookings almost fully automatically via specialized application programming interfaces (APIs). There is no need for lots of manual work as in the case with own travel inventory.

Many OTAs have turned to use travel API aggregators quite extensively in recent years. This is a great opportunity to cut down drastically on your API integration efforts by unifying multiple travel suppliers under a common product-based API. For example, a single Hotel API integration can put you through to Hotelbeds, Ratehawk, Webbeds and many other suppliers all at once in real-time. This is something really worth exploring while planning integration efforts for your OTA.

Payment gateways

Online payment options is what really wrap up the one-stop-shop experience that is so highly valued in OTAs. The market of payment gateways is so rich that it is really easy to get lost in it. Hope these few guidelines will help narrow down your search:

• Look for the list of gateways operating in your market . Your customers will appreciate a wider range of payment options that are popular in their countries. Of course, it is possible to get by with gateways like PayPal and Stripe that work worldwide. But these are almost certain to charge higher transaction fees compared to local vendors.
• Choose the most secure payment solutions . Opt for payment solutions offering strong fraud detection mechanisms and built-in security techniques – tokenization, 2FA, etc
• Check supported currencies . Be sure that your gateway can fully support the currencies you plan to work with. It would also be smart to pick a system with a wider choice of currencies to feel safer for the future.

Cutting-edge Booking Engine for an Ambitious Saudi Travel Startup

Check out how GP Solutions team introduced top-notch technology to automate the search&book flow built around a unique marketing idea.

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Innovative Hotel Booking Engine for an Ambitious Saudi Travel Startup

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CRM integrations

Integration of a CRM system can benefit your OTA business in many ways. Systems of this type are designed to provide valuable insights into customer data, behavior and sales data. They help to determine the most promising segments of your audience and indicate opportunities to yield even better financial returns from your current customers.

Most popular CRM systems like Salesforce or Hubspot may not be the cheapest pieces of software. But if used properly they can (indirectly) save you lots of money and constantly new areas to generate extra profit.

Connection to other systems

OTAs may frequently use other systems for their day-to-day needs. These may include accounting systems, reporting and analytical tools, BI solutions, etc. A properly built export API can make the process of using them much easier, as soon as it can:

• Export all kinds of business-critical data (users, reservations, bookings, etc,);
• Support different commonly used data exchange formats (CSV, XML/XSLT, JSON)

Thus, it makes sense to add this item to your OTA tech checklist.

Step 6. Building competitive customer experience

Last but definitely not least is the level of service and experience an OTA can offer to its customers. Modern travelers are very demanding and are only willing to go for top-notch service that “flows like clockwork”. This effect can only be reached by making regular contributions into:

User interfaces . Successful online booking portals usually offer the following UI elements:

• Quick registration process (with Guest booking option)
• Comprehensive search results display
• Intuitive and functional personal user area
• High level of personalization

Each of these points needs constant attention and improvement in order to keep up with the market trends. Otherwise, your portal runs the risk of falling behind.

Building trust . Every visitor to your website must feel instantly at home. The credibility of this sort can be developed with the help of various activities and techniques, such as, for example:

• Adding trustmarks to the website footer (payment gateway logos, certifications, licenses, accreditations, etc.);
• Maintaining an informative ‘About us’ area containing detailed descriptions of company history, its kye specifics, information on founders and top managers, etc.;
• Provision of elaborate descriptions on cookie and personal data policies;
• Putting up a section with customer references and testimonials

Customer service . You can’t avoid chats in the travel industry, as users always have different inquiries and questions. Don’t forget your users have a vacation mood, so customer service should be as friendly as possible.

Online travel agencies are surely one of the pinnacles of the modern travel industry. They feed off the combination of top-notch ideas and solutions across various areas: software development, UI/UX design, online marketing, eCommerce, etc. It takes a strong background in each of these areas in order to offer competitive service for the modern market. But it is even more important to focus on the right things and make your knowledge really work to the full for the benefit of your OTA business.

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