A travel agency is a private

retailer Retail is the sale of goods and services to consumers, in contrast to wholesaling, which is the sale to business or institutional customers. A retailer purchases goods in large quantities from manufacturers, directly or through a wholesal ...

public service A public service or service of general (economic) interest is any service intended to address the needs of aggregate members of a community, whether provided directly by a public sector agency, via public financing available to private busin ...

that provides travel and

tourism Tourism is travel for pleasure, and the Commerce, commercial activity of providing and supporting such travel. World Tourism Organization, UN Tourism defines tourism more generally, in terms which go "beyond the common perception of tourism as ...

-related services to the

general public In public relations and communication science, publics are groups of individual people, and the public (a.k.a. the general public) is the totality of such groupings. This is a different concept to the sociological concept of the ''Öffentlichkei ...

on behalf of accommodation or travel

suppliers A supply chain is a complex logistics system that consists of facilities that convert raw materials into finished products and distribute them to end consumers or end customers, while supply chain management deals with the flow of goods in distr ...

to offer different kinds of travelling packages for each destination. Travel agencies can provide

outdoor recreation Outdoor recreation or outdoor activity refers to recreation done outside, most commonly in natural settings. The activities that encompass outdoor recreation vary depending on the physical environment they are being carried out in. These activitie ...

, arranging logistics for luggage and medical items delivery for travellers upon request,

public transport timetable A public transport timetable (also timetable and North American English schedule) is a document setting out information on public transport service times. Both public timetables to assist passengers with planning a trip and internal timetables ...

car rental A car rental, hire car or car hire agency is a company that rents automobiles for short periods of time to the public, generally ranging from a few hours to a few weeks. It is often organized with numerous local branches (which allow a user t ...

s, and

bureau de change A bureau de change (plural bureaux de change, both ; British English) or currency exchange (Comparison of American and British English, American English) is a business where people can exchange one currency for another. Nomenclature Original ...

services. Travel agencies can also serve as general sales agents for airlines that do not have offices in a specific region. A travel agency's main function is to act as an

agent Agent may refer to: Espionage, investigation, and law *, spies or intelligence officers * Law of agency, laws involving a person authorized to act on behalf of another ** Agent of record, a person with a contractual agreement with an insuran ...

, selling travel products and services on behalf of a supplier. They are also called Travel Advisors. They do not keep

inventory Inventory (British English) or stock (American English) is a quantity of the goods and materials that a business holds for the ultimate goal of resale, production or utilisation. Inventory management is a discipline primarily about specifying ...

in-hand unless they have pre-booked hotel rooms or cabins on a cruise ship for a group travel event such as a

wedding A wedding is a ceremony in which two people are united in marriage. Wedding traditions and customs vary greatly between cultures, ethnicity, ethnicities, Race (human categorization), races, religions, Religious denomination, denominations, Cou ...

honeymoon A honeymoon is a vacation taken by newlyweds after their wedding to celebrate their marriage. Today, honeymoons are often celebrated in destinations considered exotic or romantic. In a similar context, it may also refer to the phase in a couple ...

, or other group event.

Business model

Travel agencies often receive commissions and other benefits and incentives from providers or may charge a fee to the end users.

Hotel A hotel is an establishment that provides paid lodging on a short-term basis. Facilities provided inside a hotel room may range from a modest-quality mattress in a small room to large suites with bigger, higher-quality beds, a dresser, a re ...

owners and

tour operator A tour operator is a business that typically combines and organizes lodging, accommodations, meals, sightseeing and transportation components, in order to create a package tour. They advertise and produce brochures to promote their products, holi ...

s typically pay a higher commission rate to travel agencies, whereas airlines typically pay no commission. The customer is normally not made aware of how much the travel agent is earning in commissions and other benefits. A 2016 survey of 1,193 travel agents in the United States found that on average 78% of their revenue was from commissions and 22% was generated from fees.

Accreditation number

Travel agencies are recognized by vendors through their accreditation numbers. In the United States, the main accreditation numbers are issued by Airline Reporting Corporation,

Cruise Lines International Association Cruise Lines International Association (CLIA) is a cruise line trade association. It merged with International Council of Cruise Lines (ICCL) in 2006, forming an expanded organization incorporating the existing functions of both organizations. The ...

International Air Transport Association The International Air Transport Association (IATA ) is an airline trade association founded in 1945. IATA has been described as a cartel since, in addition to setting technical standards for airlines, IATA also organized tariff conferences tha ...

. If more than one travel agency is booking under the same accreditation number, the agency of record is called a host agency. This is a popular model in the United States, with surveys show anywhere from 43-85% of leisure agencies now booking under a host agency.

Travel technology

Travel agencies use the services of the major

computer reservations system Computer reservation systems, or central reservation systems (CRS), are computerized systems used to store and retrieve information and conduct transactions related to air travel, hotels, car rental, or other activities. Originally designed and ope ...

s, also known as

global distribution system A global distribution system (GDS) is a computerised network system owned or operated by a company that enables transactions between travel industry service providers, mainly airlines, hotels, car rental companies, and Travel agency, travel agen ...

s (GDS), including: Amadeus CRS, Galileo GDS,

Sabre A sabre or saber ( ) is a type of backsword with a curved blade associated with the light cavalry of the Early Modern warfare, early modern and Napoleonic period, Napoleonic periods. Originally associated with Central European cavalry such a ...

, and

Worldspan Worldspan is a provider of travel technology and content and a part of the Travelport GDS business. It offers worldwide electronic distribution of travel information, Internet products and connectivity, and e-commerce capabilities for travel agenci ...

, which is a

subsidiary A subsidiary, subsidiary company, or daughter company is a company (law), company completely or partially owned or controlled by another company, called the parent company or holding company, which has legal and financial control over the subsidia ...

Travelport Travelport Worldwide Ltd. provides distribution, technology, and payment solutions for the travel and tourism industry. It is the smallest, by revenue, of the top three global distribution systems (GDS) after Amadeus IT Group and Sabre Corporatio ...

, which allow for comparison and sorting of hotel and flight rates with multiple companies. Bookings made via travel agents, including online travel agents, may or may not be confirmed instantly. Unlike online travel agencies,

metasearch engine A metasearch engine (or search aggregator) is an online information retrieval tool that uses the data of a web search engine to produce its own results. Metasearch engines take input from a user and immediately query search engines for results. ...

s and

scraper site A scraper site is a website that copies content from other websites using web scraping. The content is then mirrored with the goal of creating revenue, usually through advertising and sometimes by selling user data. Scraper sites come in various ...

s, such as Skyscanner, Kayak.com, Rome2rio, and

TripAdvisor Tripadvisor is an American company that operates online travel agency, travel agencies, comparison shopping websites, and mobile apps with user-generated content. Its namesake brand, Tripadvisor.com, operates in 40 countries and 20 languages, and ...

, travel agencies may or may not have their own booking engine, and instead provide results for search queries and then divert traffic to service providers or online travel agencies for booking. Travel agents may also work with airline consolidators. Some companies use technology to promote

sustainable tourism Sustainable tourism is a concept that covers the complete tourism experience, including concern for Impacts of tourism, economic, social, and environmental issues as well as attention to improving tourists' experiences and addressing the needs o ...

and bring carbon-neutrality.

Types of travel agencies

Traditional travel agencies

A traditional travel agent may work for a travel agency or work

freelance ''Freelance'' (sometimes spelled ''free-lance'' or ''free lance''), ''freelancer'', or ''freelance worker'', are terms commonly used for a person who is self-employed and not necessarily committed to a particular employer long-term. Freelance w ...

. Many traditional agents prefer the term "travel advisor" as opposed to "travel agent" to emphasize their advice, expertise, and connections that are of great value. While most point-to-point travel is now booked online, traditional agents specialize in

niche market A niche market is the subset of the market on which a product is appealed to a small group of consumers. The market niche defines the product features aimed at satisfying specific market needs, as well as the price range, production quality and the ...

s such as corporate travel, luxury travel, cruises, complicated and important trips, and specialty trips. Other niche markets for traditional travel agencies include travelers with disabilities, travelers over the age of 60, women traveling alone,

LGBT tourism LGBTQ tourism (or gay tourism) is a form of tourism marketed to gay, lesbian, bisexual, transgender, and queer (LGBTQ) people. It may also include a focus on other members of the (broader) community. The tourism, and its related establishments, ...

, or a particular group interested in a similar activity, such as a

sport Sport is a physical activity or game, often Competition, competitive and organization, organized, that maintains or improves physical ability and skills. Sport may provide enjoyment to participants and entertainment to spectators. The numbe ...

Franchise travel agencies

Helloworld Travel is an example of a franchised travel agency, giving agents access to internal systems for product and bookings.

Online travel agencies

A online travel agency (OTA) uses a platform business model to generate

revenue In accounting, revenue is the total amount of income generated by the sale of product (business), goods and services related to the primary operations of a business. Commercial revenue may also be referred to as sales or as turnover. Some compan ...

. The

Expedia Group Expedia Group, Inc. is an American travel technology company that owns and operates travel fare aggregators and travel metasearch engines, including Expedia, Hotels.com, Vrbo, Travelocity, Hotwire.com, Orbitz, Ebookers, CheapTickets, C ...

is the largest OTA globally. Booking Holdings is the second largest OTA.

Licensing

In many countries, all travel agencies are required to be licensed by the

(IATA). Many are also bonded and represented by IATA, and, for those that issue air tickets, the

Air Travel Organisers' Licensing Air Travel Organisers' Licensing (ATOL) is a United Kingdom Civil Aviation Authority (CAA) scheme to give financial protection to people who have purchased package holidays and flights from a member tour operator. Corporate function The major ...

(ATOL) in the United Kingdom, and the Airlines Reporting Corporation in the United States also serve those purposes.

ABTA – The Travel Association ABTA Limited (trading as ABTA – The Travel Association and formerly known as the Association of British Travel Agents Limited) is a trade association for tour operators and travel agents in the United Kingdom. History The organisation's first ...

the Association of Canadian Travel Agencies (ACTA) The American Society of Travel Advisors (ASTA), represent travel agencies in the United Kingdom, Canada, and the United States respectively.

History

In 1758,

Cox & Kings Cox & Kings (formerly known as Cox & Kings Ltd.) was established in 1758 and is one of the longest-established travel brands. The UK business of Cox & Kings was acquired by Abercrombie & Kent in 2019 following insolvency proceedings, while in Ma ...

became the first travel agency in modern history. In 1840, the Abreu Agency was established in Porto by Bernardo Abreu, becoming the world's first agency to open its services to the public. In 1841,

Thomas Cook Thomas Cook (22 November 1808 – 18 July 1892) was the founder of the travel agency Thomas Cook & Son. He was born into a poor family in Derbyshire and left school at the age of ten to start work as a gardener's boy. He served an appren ...

, a

Baptist Baptists are a Christian denomination, denomination within Protestant Christianity distinguished by baptizing only professing Christian believers (believer's baptism) and doing so by complete Immersion baptism, immersion. Baptist churches ge ...

preacher who believed that alcohol was to blame for social problems, reached an agreement with the

Midland Railway The Midland Railway (MR) was a railway company in the United Kingdom from 1844 in rail transport, 1844. The Midland was one of the largest railway companies in Britain in the early 20th century, and the largest employer in Derby, where it had ...

to organize the transportation of 500 members of his

temperance movement The temperance movement is a social movement promoting Temperance (virtue), temperance or total abstinence from consumption of alcoholic beverages. Participants in the movement typically criticize alcohol intoxication or promote teetotalism, and ...

from the

Leicester Campbell Street railway station Leicester railway station (formerly Leicester Campbell Street and Leicester London Road) is a main line railway station in the city of Leicester, in Leicestershire, England. The station is managed by East Midlands Railway and owned by Network R ...

to a rally in

Loughborough Loughborough ( ) is a market town in the Charnwood (borough), Charnwood Borough of Leicestershire, England; it is the administrative centre of Charnwood Borough Council. At the United Kingdom 2021 census, the town's built-up area had a popula ...

in exchange for a commission. He formed

Thomas Cook & Son Thomas Cook & Son, originally simply Thomas Cook, was a British travel company that existed from 1841 to 2001. It arranged transport, tours and holidays worldwide. It was owned by the British government from 1948 to 1972. The company was foun ...

, which later became The Thomas Cook Group. It filed

bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the deb ...

and underwent

liquidation Liquidation is the process in accounting by which a Company (law), company is brought to an end. The assets and property of the business are redistributed. When a firm has been liquidated, it is sometimes referred to as :wikt:wind up#Noun, w ...

in 2019. In 1871, Dean and Dawson was founded in the United Kingdom and in the 1950s, it was acquired by Thomas Cook. In 1870, the Polytechnic Touring Association was founded in the United Kingdom. In 1887, Walter T. Brownell established Brownell Travel, the first travel agency in the United States, and led 10 travelers on a European tour setting sail from New York on the SS ''Devonia''. In 1895, Baldwins Travel was founded by Alfred K Baldwin, originally a printer, bookbinder and publisher in Tunbridge Wells. Baldwins begins selling railway tickets and helping friends to travel to Europe and beyond. News spreads and the former printers slowly build a strong side-line in travel at the back of the Baldwins Stationery shop at 27 Grosvenor Road. In 1905, Nippon Travel Agency became the first travel agency in

Japan Japan is an island country in East Asia. Located in the Pacific Ocean off the northeast coast of the Asia, Asian mainland, it is bordered on the west by the Sea of Japan and extends from the Sea of Okhotsk in the north to the East China Sea ...

. Originally, travel agencies largely catered to middle and upper-class customers but they became more commonplace with the development of

commercial aviation Commercial aviation is the part of civil aviation that involves operating aircraft for remuneration or hire, as opposed to private aviation. Definition Commercial aviation is not a rigorously defined category. All commercial air transport and ae ...

. In 1923, after being treated badly by a British travel agency, K. P. Chen formed what became the China Travel Service, the first travel agency in

China China, officially the People's Republic of China (PRC), is a country in East Asia. With population of China, a population exceeding 1.4 billion, it is the list of countries by population (United Nations), second-most populous country after ...

. The industry suffered during

World War II World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...

. However, the

Post–World War II economic expansion The post–World War II economic expansion, also known as the postwar economic boom or the Golden Age of Capitalism, was a broad period of worldwide economic expansion beginning with the aftermath of World War II and ending with the 1973–1975 r ...

in mass-market package tours resulted in the proliferation of travel agencies catering to the

working class The working class is a subset of employees who are compensated with wage or salary-based contracts, whose exact membership varies from definition to definition. Members of the working class rely primarily upon earnings from wage labour. Most c ...

. In 1929, Intourist was formed as the official state travel agency of the

Soviet Union The Union of Soviet Socialist Republics. (USSR), commonly known as the Soviet Union, was a List of former transcontinental countries#Since 1700, transcontinental country that spanned much of Eurasia from 1922 until Dissolution of the Soviet ...

, with the goal of convincing outsiders to visit the country. In 1931, the US trade organization ASTA (originally the American Steamship and Tourist Agents Association, now the American Society of Travel Advisors) was created. During the

Cold War The Cold War was a period of global Geopolitics, geopolitical rivalry between the United States (US) and the Soviet Union (USSR) and their respective allies, the capitalist Western Bloc and communist Eastern Bloc, which lasted from 1947 unt ...

, travel agents were used by people from Western countries to travel behind the

Iron Curtain The Iron Curtain was the political and physical boundary dividing Europe into two separate areas from the end of World War II in 1945 until the end of the Cold War in 1991. On the east side of the Iron Curtain were countries connected to the So ...

. In 1951, the precursor to Helloworld Travel became one of the first travel agencies in

Australia Australia, officially the Commonwealth of Australia, is a country comprising mainland Australia, the mainland of the Australia (continent), Australian continent, the island of Tasmania and list of islands of Australia, numerous smaller isl ...

. In 1955, Henderson Travel Service in

Atlanta Atlanta ( ) is the List of capitals in the United States, capital and List of municipalities in Georgia (U.S. state), most populous city in the U.S. state of Georgia (U.S. state), Georgia. It is the county seat, seat of Fulton County, Georg ...

, Georgia became the first African-American-owned travel company and the first to take large groups of black American tourists to Africa. In the early 1980s,

American Airlines American Airlines, Inc. is a major airlines of the United States, major airline in the United States headquartered in Fort Worth, Texas, within the Dallas–Fort Worth metroplex, and is the Largest airlines in the world, largest airline in the ...

unit created a direct-to-consumer booking tool for flights, hotels and cars called eAAsySabre. In 1989, with the liberalization of travel for

South Korea South Korea, officially the Republic of Korea (ROK), is a country in East Asia. It constitutes the southern half of the Korea, Korean Peninsula and borders North Korea along the Korean Demilitarized Zone, with the Yellow Sea to the west and t ...

ns, Mode Tour became the first travel agency in the country. In 1991, Hotel Reservations Network, the precursor of Hotels.com, was founded. At first, hotels did not pay much in commissions. With the advent of the

internet The Internet (or internet) is the Global network, global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a internetworking, network of networks ...

, travel agencies migrated online and underwent

disintermediation Disintermediation is the removal of intermediary, intermediaries in economics from a supply chain, or "cutting out the middlemen" in connection with a transaction or a series of transactions. Instead of going through traditional distribution cha ...

by the reduction in costs caused by removing layers from the package holiday distribution network. In 1994, Travelweb.com launched as the first online directory of hotels. In 1995, Internet Travel Network sold the first airline ticket via the World Wide Web. In October 1996, Expedia.com, funded with hundreds of millions of dollars by

Microsoft Microsoft Corporation is an American multinational corporation and technology company, technology conglomerate headquartered in Redmond, Washington. Founded in 1975, the company became influential in the History of personal computers#The ear ...

launched as the first large online travel agency. At the same time, Cheapflights started as a listing service for flight deals from consolidators. In 1998, Lastminute.com was founded in the United Kingdom. In 1999, Expedia went public on the Nasdaq stock exchange. From 1999 to 2006, the number of travel agents in the United States plunged from 124,000 to 88,000 as many Americans switched to making their own travel arrangements online. Also in 1999, European airlines began eliminating or reducing commissions, while

Singapore Airlines Singapore Airlines (abbreviation: SIA or SQ) is the flag carrier of Singapore with its Airline hub, hub located at Changi Airport. Considered to be one of the world's best carriers, the airline is ranked as a 5-star airline as well as ranked ...

did so in parts of

Asia Asia ( , ) is the largest continent in the world by both land area and population. It covers an area of more than 44 million square kilometres, about 30% of Earth's total land area and 8% of Earth's total surface area. The continent, which ...

. In 2002, several airlines in the United States did the same, which led to an unsuccessful lawsuit alleging collusion among the airlines, that was decided on appeal in 2009. In 2007, the launch of the

iPhone The iPhone is a line of smartphones developed and marketed by Apple that run iOS, the company's own mobile operating system. The first-generation iPhone was announced by then–Apple CEO and co-founder Steve Jobs on January 9, 2007, at ...

and related

mobile app A mobile application or app is a computer program or software application designed to run on a mobile device such as a smartphone, phone, tablet computer, tablet, or smartwatch, watch. Mobile applications often stand in contrast to desktop appli ...

s increased travel bookings made online. In 2008, the launch of

Airbnb Airbnb, Inc. ( , an abbreviation of its original name, "Air Bed and Breakfast") is an American company operating an online marketplace for short-and-long-term homestays, experiences and services in various countries and regions. It acts as a ...

created an

online marketplace An online marketplace (or online e-commerce marketplace) is a type of e-commerce website where product or service information is provided by multiple third parties. Online marketplaces are the primary type of multichannel ecommerce and can be a wa ...

for spare bedrooms and apartments. In 2011, the launch of HotelTonight highlighted instantaneous same-day hotel room booking. In 2021, travel agency Baldwins Travel Group, which was founded in 1895 was bought by business group Inc & Co.

Outlook

According to the United States

Bureau of Labor Statistics The Bureau of Labor Statistics (BLS) is a unit of the United States Department of Labor. It is the principal fact-finding agency for the government of the United States, U.S. government in the broad field of labor economics, labor economics and ...

, in 2022, there were 66,300 people who were employed as travel agents for their

full-time job A full-time job is employment in which workers work a minimum number of hours defined as such by their employer. Overview Fulltime employment often comes with benefits that are not typically offered to part-time, temporary, or flexible worke ...

s. That number is projected to increase by 3% over the next 10 years. In 2022, the BLS lists the median travel agent salary as $46,400 per year. Host Agency Reviews lists employee salaries by compensation structure, listing the 2022 income for travel agents that earn salary + commissions (25% of travel advisor employees) at $88,909, those that earn salary/hourly only at $50,792 (44% of employee travel agents), and commission only travel employees at $21,932 (31%). However, job prospects should be best for travel agents who specialize in specific destinations or particular types of travelers. Several reports show that the number of people using travel agents to book travel has been increasing.

References

{{DEFAULTSORT:Travel Agency Airline tickets