Travel Agencies
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 8,600 travel agencies in the US provide reservation and travel services to individuals and groups. Travel agencies generate revenue through two models: the merchant model and the retail/agency model. Under the retail/agency model, agencies earn commissions from suppliers based on bookings. Under the merchant model, agencies earn revenue by charging customers more than the negotiated amount paid to travel suppliers.
Economic Sensitivity
The travel industry is vulnerable to downturns in the economy and fluctuations in corporate and consumer spending.
Competition From Alternative Sources
Travel agencies compete with a variety of alternative sources for business.
Industry size & Structure
Industry Forecast
Travel Agencies Industry Growth
Recent Developments
Apr 5, 2024 - Employment Rebound Continued in 2023
- Employment by travel agencies grew 12.1% in December compared to a year ago after rising 21% in the previous annual comparison, according to the US Bureau of Labor Statistics. At the end of last year, employment was up 59% from its low point in March 2021. Average wages at travel agencies were $28.00 per hour in December, down 1% year over year, while producer prices for travel agencies rose by 1.62% in December compared to a year ago, BLS data show. Rising consumer spending and sustained pent-up demand for travel following the pandemic are fueling the growth of the travel industry.
- Travel demand is expected to grow this year with premium and luxury travel in high demand, according to Travel Agent Central (TAC). A recent survey of travel advisors conducted by American Marketing Group (AMG) found that 79% of respondents expect their sales to increase in 2024. Of those, 31% foresee significant growth, and 48% believe sales will grow somewhat. Only 5% predicted sales would decline somewhat, with none of the respondents anticipating a significant drop. Another survey, conducted by the agency group Travel Experts, found 80% of respondents expected business to increase in 2024 with more than 95% reporting that business was up in 2023. “After so much built-up demand, travelers today are venturing far and wide and spending more on higher-end travel experiences,” said Kathryn Mazza-Burney, chief sales officer for AMG, adding “Premium and luxury are leading the way again for 2024.”
- The US ranks 17th out of 18 top travel markets in terms of global competitiveness, according to Euromonitor International. Only China performed worse according to the study released by the US Travel Association in January. The USTA blamed decades of underinvestment and a lack of focus and coordination from federal policymakers for the nation's poor performance. While the US is still the most desired destination for global travelers, it slid to third in total visits (behind Spain and France). In 2023, it’s estimated the US welcomed nearly 67 million international visitors – down from 79 million visitors in 2019, and only 84% recovered from pre-pandemic levels, far behind other competitors’ recovery rates, according to the study. Countries were ranked by national leadership; brand & product; identity, security & facilitation; and travel & connectivity with the US underperforming in national leadership, and identity, security & facilitation.
- The number of longtime travel agents/advisors has dropped precipitously in recent years, according to Travel Weekly’s annual Travel Industry Survey out in November. In 2021, nearly half (46%) of survey respondents had been in the industry for more than 30 years. That number sank to 16% in 2023, meaning nearly a third of experienced agents have left the industry, according to the survey. At the same time, the industry is attracting new entrants: In 2021, only 5% of those surveyed reported being in business for two years or less rising to 19% in 2023. However, the average travel advisor's earnings are low with 39% making less than $25,000 per year. The majority (80%) of new entrants, those in the business for two years or less, reported an income below $25,000, TW reports.
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