ACTA Prez on the Future of Canada's Agents
by Andrew Sheivachman /Changes to the Canadian economy and shifting trends in how travelers’ spend on trips, are affecting how Canadian travel agents must operate in order to be profitable.
Despite those developments, the future is bright for agents, according to Association of Canadian Travel Agents (ACTA) president and COO David McCaig.
McCaig believes that agents who have the right technology partners, and a solid education in sales and business trends, can be more successful than ever before.
ACTA is a co-sponsor, along with Travel Market Report, of the second annual Travel MarketPlace. This leading conference for Canadian travel professionals is set for June 16 to 17 at the International Plaza Hotel in Toronto.
McCaig spoke with Travel Market Report about the challenges and opportunities facing Canadian travel sellers and the tools they need to succeed.
What are the major issues facing Canada’s travel agents?
McCaig: Smaller agencies are trying to keep up with the evolving industry and the technology of booking software, ticket issuances, commissions recovery, and reconciliation market support.
A difference is emerging between the players who have the technology and the ability to really look after a client, and those who don’t. A client can be a big company or a small independent but they all want the same service.
One of the challenges we have [in Canada] is provincial regulations in terms of health insurance. We’re working to try and get one license across Canada; across all provinces, sort of like a driver’s license. It’s similar to the challenges going on in the U.S. states with insurance.
How can a conference like Travel MarketPlace help agents address those issues?
McCaig: We’re thrilled to be a big part of Travel MarketPlace because travel suppliers have a unique opportunity to meet with a large number of top-producing agents.
The conference is focused on giving agents the information they need whether that’s educational, all aspects of social media or selling—how to sell and how to sell better. The quality of the speakers is also top notch.
What’s the state of Canada’s agent community? Is it thriving like the U.S. agent community?
McCaig: We’re always a little different than the U.S. After 9/11, [many] American agents became ICs [independent contractors] or worked from home. Now, we’re going through that in the last year or two here in Canada.
More and more agents are becoming ICs. At the same time, we’re seeing all kinds of mergers and acquisitions in the travel agency community. There’s a maturing of the top people. They want to look after the clients they've had for a long time, but they don't want to necessarily own the business anymore due to the need for capital and technology.
What changes in the economy have affected Canada’s agents?
McCaig: The most significant change is the price of oil dropping. It has had a major impact on travel in and out of Western Canada—Alberta specifically. It’s also making a difference in the Maritimes and Newfoundland, where they have oil-producing capability.
I’ve been talking to the large TMCS [travel management companies] and they’re saying travel is down; business travel is down 25% given new travel restrictions due to the price of oil combined with the drop in the Canadian dollar compared to the U.S. dollar.
We’re all happy to see the U.S. dollar and economy doing much better, but certainly our lower dollar does not help since airlines have to purchase everything in U.S. dollars.
How have those changes affected Canada’s agents?
McCaig: We have the independent agent who wants to have clients and look after them; they want the host or company they work for [to take care of the other stuff]. We have very large TMCs that are now offering the ability to have ICs and that area is really growing.
Some of the ICs working for some large TMCs are doing over $5 million each in travel. It’s only a little while ago that an agent doing over $1 million or $2 million was spectacular.
The bar has been raised higher because the technology is now so good. When you’re looking after a large corporate client, they want hotels, cars, drivers, and protection when they go to some countries that are not safe as they could be.
What is the outlook for Canada’s agents?
McCaig: The agents who are connected with a top technology company will have the ability to look after their clients easily because they have that technology, and the company is well capitalized.
We’re seeing a resurgence of young people coming into the business because they’re becoming well-educated, picking up on the clients that aren’t being looked after, and are filling the gaps of the mature people who are leaving the business.
We took over the educational division at the Canadian Institute of Travel Counsellors (CITC) and we’re seeing a huge return in people who want to get their CTC or CTM designations. We’re thrilled about that.