Travel Agent Resurgence Continues

by Richard D’Ambrosio

The resurgence of U.S. travel agencies continues, as 74% of American Society of Travel Agents members reported growing or stable revenue, and nearly eight out of ten said they grew or maintained their client base in 2015, the association found in a new report released recently.
 
Seven in ten agencies realized a profit, and another 14% broke even in 2015, according to the separate 2016 ASTA Agency Profile report.
 
For the first half of 2016, “financial performance remained strong,” with 74% indicating their revenues increased or maintained the same levels compared to the first half of 2015. ASTA reported similar results in transactions (70%) and number of clients (78%).
 
“The percentage of agencies that reported a profit continues to rise since 2011, indicating improved business trends post-recession,” ASTA said in a report unveiled this week. “Conversely, the share of those agencies that operated at a loss or were unsure about profit/loss condition has been gradually decreasing over the past five years.”
 
“These are all very positive numbers. Our members are still thriving. Consumers are still seeking out travel agents,” said ASTA spokesperson Erika Richter, during a press briefing.
 
Richter said that in an initial pass on first half 2016 data, 56% of agents said cruise sales improved and 53% said travel insurance sales were up versus first half 2015.
 
The increase in sales in 2015 came mostly from cruise, FIT and travel insurance, with all three segments increasing at more than 50% of the agent respondents. These segments were followed by tour groups (48%), hotel (45%) and air (40%).
 
Travel agencies receive the highest commission rates selling travel insurance (19-21%), tours (15-17%) and cruises (13-16%).
 
“Going into 2016, similar positive sales trends remained,” ASTA said in its report, “however, seasonality and isolated geopolitical incidents might have had a certain degree of short-term impact on regional travel that caused some shifts in certain travel segments.”
 
The data was collected through the 2016 ASTA Research Family survey panel, comprised of a representative sample of ASTA member travel agency owners and managers. Members were recruited randomly and were contracted to complete a survey every four to five weeks from January 2016 through November 2016, and 341 Research Family members completed the survey.
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Tip of the Day

We, as advisors, have to start looking at different avenues that will pay better for us, so you can continue to at least be profitable.

Nicole Mazza, Travelsavers

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