Let’s be honest: When it comes to travel, most of us worry about our budget — a lot. Some travelers find it hard to trust travel agents or advisers because they worry about being charged for using their services.
However, not all travel advisers have fees — though it is a growing trend to charge them.
TravelPulse took a deep dive into why and how travel agents charge for their travel planning services, and why some choose to keep their travel planning services free for travelers.
Are travel agents free?
The question is more complicated than you might at first think.
Traditionally, travel advisers are paid a commission by their suppliers. So if you go on a cruise, the cruise line will pay the travel adviser you use for booking your trip.
Commissions are usually a standard commission rate decided by the cruise line (such as 20 percent of the cost of the cruise), though this can range depending on, for example, whether your travel adviser is affiliated with a host agency that can provide higher commissions for the suppliers they use most frequently due to business partnerships (though often the host agencies take a portion of a travel adviser’s commission, which can further complicate things). This is the case for cruise lines, tour operators, hotels and resorts and even vacation packagers.
Commissions were once the standard way that travel advisers made money: not by charging customers, but by earning money from the suppliers they used.
Tammy Levent, president of Elite Travel Management, explains why her agency has never charged fees: “At Elite Travel, after thriving in the travel industry for over 30 years, we have built a solid reputation based on trust and exceptional service. We understand the competitive nature of today’s travel market, especially with the rise of online booking platforms
“Introducing a service fee could discourage potential clients from booking with us,” Levent explained. “We aim to remove any barriers that might prevent someone from experiencing our superior service and competitive rates. We are confident that once clients experience Elite Travel’s offerings, they will see the value we provide. Furthermore, during our initial interactions, we communicated to our clients that we operate on a commission basis. We’d like to ask that they contact us with serious booking intentions or wait until they are ready to book, ensuring a commitment to the quality and earnestness of our services.”
Let’s be real: there’s a cost-of-living crisis happening in cities and countries across the globe, and that’s led a lot of people in different industries to change their business strategies.
The same is happening among travel advisers, and a new trend has begun: charging fees for certain travel planning services. Of the 26 travel advisers who shared their expertise for this article, 17 of them charged some type of travel planning service fee, though their fee structures vary.
So what are some specific reasons that travel advisers are beginning to charge fees for their services? Let’s take a closer look.
One of the biggest reasons travel advisers choose to charge fees for their travel planning services is to weed out any clients who might not be serious clients in the long run. Travel advisers can spend hours quoting and pricing trips for travelers, yet those same travelers might just book directly or choose to plan the trip themselves, therefore taking away the opportunity for their adviser to generate income from those hours. That’s only one example of one of the frustrations of a travel adviser.
More complicated bookings like FIT trips, group travel, destination weddings or meetings can also take hours to plan, yet most travel advisers aren’t paid by the hour. That means they’re relying on the promise of a commission only after their clients have left on their trip.
Another reason should be easy to understand: sometimes commissions just aren’t enough. Imagine a travel adviser only earns $200 in commission from a FIT booking that took 16 hours to plan, book and execute. Divided by the number of hours spent planning the trip, the travel adviser’s take-home pay is only $12.5 per hour.
While this is a creative example, it can demonstrate that sometimes, the amount of time spent planning travel for others doesn’t actually pay when it comes down to the amount of commission the adviser will earn, leading some to introduce travel planning fees, fees for booking airfare (another segment that pays relatively limited or no commission) and more.
JoAnne Weeks, Vacation Division Director at Acendas Travel, was one of the travel advisers who started out not charging fees, but found them useful and even necessary after the pandemic ended.
“I am the first to admit that I pushed back on fees for a long time,” said Weeks. “Especially for cruises, but I came to realize, I was giving away my 28 years of cruise expertise to my clients for free. People would request information, I take my time to research, put together a custom quote for lines they hadn’t even heard of, only for them to take my information I gifted them and book it themselves. We grew tired of being used. You’re required to pay to consult a lawyer, a plumber’s service call, heck even the person cutting your hair. We are worth it.”
Weeks said that the revenge travel trend of the post-pandemic travel era led to many travelers asking for information, but leaving without booking with Acendas Travel, leaving her to implement a fee structure in 2021. Fees for her agency include a cruise concierge fee, FIT fee, flat air service fees and more, all adjusted according to how long each takes to plan.
Nick Pena, Luxury Travel Designer at Cruise Planners, is a travel adviser who charges clients fees for ticketing airfare, changing their itineraries and cancellations.
“Charging fees helps weed out the clients I don’t want and keep the ones that value the work that I do,” Pena explained. “Having a fee structure allows the adviser to have a more stable income, guaranteeing my time is paid for whether they do the trip or not. Even simple tasks like ticketing airline tickets get a fee of $25. No one else works for free. Why should I?
“The imposition of a professional fee is a testament to my value,” he continued. “I offer a life-saving lighthouse amidst overwhelming travel options, constantly changing regulations, and unforeseen circumstances that can arise even in the most meticulously planned trips. My fees ensure that I remain by the client’s side.”
