Why Every Travel Advisor Needs a Business Plan…And How to Start One

When you venture out on a trip by car, plane, or cruise ship, the operator uses a map or GPS for directions, right? The most effective way to get from point A to point B is by setting a clear pathway in advance and planning for any potential obstacles. This is equally true in running a travel agency business. Having a solid business plan helps you steer your time, energy, and resources from where you are now to where you want to be.

We spoke to a few travel advisors who recently had the experience of learning from small business experts about the importance of creating a business plan for their travel agency. Here is what they had to say.

A critical tool of empowerment
“A business plan is important in that it helps you get a clear overview of your goals and objectives for your travel agency. Having a travel agency business plan is truly essential, whether starting a new agency or having been in the business for years … I think of it as a blueprint that will help me navigate through the travel industry, all while achieving my goals of doing the one thing that I love the most, and that’s helping my clients make memories,” says Gwen Johnson, CTC, owner and travel advisor, GMN Vacations, LLC.

Paula McDonald, owner and travel advisor, of Family 1^st Travelers, LLC, says: “A business plan is not just a document; it’s your compass, blueprint, and guiding star. It’s the tool that empowers you to define your goals, identify your audience, and navigate through challenges.”

McDonald is experienced in the task of creating a business plan. She already had a business plan in place for her agency before participating this summer in a program to help travel advisors develop one. But she says she reviews it often, and the course facilitators encouraged her to revisit her goals. She has a clear understanding of why every travel advisor needs a business plan, which she eloquently shared with us.

“Having a business plan is crucial for travel advisors for several compelling reasons,” explains McDonald. “For example, it provides a roadmap for travel advisors and outlines specific goals, objectives, and strategies, giving a clear sense of direction. The business plan ensures the advisor focuses efforts and resources on activities aligning with the vision. It is essential to determine the business’s financial stability and growth, and set realistic expectations for growth and profitability. 

“A business plan challenges travel advisors to define their target market and niche. Knowing who the ideal customers are helps tailor services and marketing efforts to meet their needs and preferences. A business plan outlines marketing strategies, which are essential for attracting clients.

“Additionally, with a business plan, travel advisors can allocate resources wisely. A well-structured business plan reflects professionalism and commitment. Without a business plan, a travel advisory business may lack direction and struggle to reach its full potential.” 

What to include in the plan
A well-thought-out business plan sets you up for success. There are several components to include in a winning business plan that – when crafted with deliberation, understanding, and commitment – can help travel advisors fast-track their sales and income.

As for what to include in a business plan, the mission statement clearly defines what your business is, what you offer, and what differentiates your products/services from others in the marketplace.

The marketplace analysis section delves into who your target customer(s) are, including demographics (such as age, economic status, where they live, their travel styles), their hobbies, what motivates them, etc. Also key is to identify what the growth potential is for reaching that target audience within your sphere of influence.

The financial section is crucial. This includes a plan that sets sales goals that are clear and realistic; pinpoints where target customers will come from; describes sales activities to reach the objectives of the business; addresses staffing needs and costs; and lays out monthly and yearly cash flow projections.

The marketing component is critical. It is the roadmap to organize, execute, and track marketing strategies. This includes the different types of marketing tactics (such as website, email, social media posts and ads, events, word-of-mouth, and co-op marketing with suppliers); how to implement them; what it will cost; and how to track results and make relevant adjustments.

The executive summary of a business plan is positioned first in the final document, but is often written last. It provides a short summary of the agency’s mission, growth goals for the coming year(s), and how those goals will be achieved.

There are many courses led by small business associations and business coaches, both online and in person, that travel advisors can tap into for help in crafting a great business plan. Local community colleges often have classes, as well. And some travel industry partners assist in this regard, which is perhaps the most effective approach, since they understand the travel industry inside and out.

Travel advisor aha moments
Leigh Lee, owner and travel advisor, Our Next Adventure Travels, had an aha moment during the process of creating her business plan. It was “when one of the instructors told us to think outside the box and think how your business can be different. If it is a niche, then you can charge more because not everyone can do what you do. I always plan trips for my mom, who is a disabled veteran, and I realized that I love helping people who have disabilities. This is when I realized my passion for travel and my passion for helping people with disabilities can come together to make a successful business.

“This program made me realize that I have a niche market, and I have more value to offer to my clients because of my education and training.”

Exactly the opposite, Johnson says: “When I was building my business plan, my aha moment was when I realized I didn’t have to limit myself to a specific niche. I’m passionate about creating a memorable experience for my clients, and technology has helped me make that happen. For example, the digital itinerary product I use includes a chat feature that allows me to automate tasks and provide a more personalized touch.”

There are no correct or incorrect answers. Wherever the business planning process leads is valuable and unique to each travel advisor, and to achieving the business of their dreams.

McDonald’s aha moment was “realizing the importance of understanding our target audience intimately. This ‘aha’ moment went beyond knowing that our focus was on our travelers; it meant diving deep into their unique needs and preferences. Through extensive market research and customer surveys, we unearthed invaluable insights. We discovered that the travel community sought convenient travel options and experiences catering to all age groups. This revelation led us to develop tailored packages incorporating activities for our business partners who travel with family and our families traveling with children, parents, and extended family members. This ‘aha’ moment fundamentally keeps us focused on the fact that we are in the business of creating unforgettable travel memories and experiences.”   

And their challenges
As many of her peers would undoubtedly agree, Johnson describes: “The most challenging part of a travel business plan for me is the financial section. I’ve never been a fan of crunching numbers, but I understand how important it is to have a solid financial plan in place. The travel industry has so many factors that can affect the demand for travel, and it is constantly changing; therefore, you must be prepared for anything, including economic conditions, natural disasters, and competition. A strong financial plan will help you weather the storms.”

For Lee, the challenge was “finding the statistics that supported the need for travel agents that assist people with disabilities. I needed to see the numbers before I changed my whole business around to mostly serve people who have disabilities. I overcame this obstacle by reaching out to other travel agents who have been in the travel business longer. The second thing was looking at my sales in the last year, and realizing I could have done more sales if I had written this business plan sooner.”

McDonald explains that, for her, the most challenging aspects in creating the business plan “were undoubtedly patience and learning about our target audience. Developing a business plan requires careful thought, research, and deliberation. Creating a business plan is a process that can take time, as it lays the foundation for the entire venture. We overcame that by establishing a structured timeline and task list, allocating specific timeframes for each business plan section. Setting a structured time helped manage expectations and prevent the urge to rush through the process. Regular check-ins and progress reviews with the team ensured we stayed on track while allowing necessary adjustments.”

McDonald also describes: “Understanding family and corporate travelers’ nuanced needs and preferences was a complex task. It required in-depth market research, customer surveys, and the flexibility to adapt as new insights emerged. This process demanded keen attention to detail and a willingness to listen and learn from our potential clients. We overcame that by investing time in market research and conducting thorough surveys to gather valuable data. We also directly talked with families and business owners through focus groups and individual interviews to better understand their travel desires and needs. This hands-on approach provided invaluable insights for our business plan, ensuring it was finely tuned to cater to the specific needs of our target audience.”

Take the first step
How do you begin the considerable task of formulating a business plan? Just take the first step. “Start by envisioning where you want your travel business to be, then break it down into achievable milestones,” suggests McDonald.

She also stresses: “Remember, patience is key. Building a thriving travel advisory business takes time. Take the time to research, learn, and refine your plan. Each adjustment brings you one step closer to your vision. And don’t be afraid to seek guidance. Connect with mentors, attend workshops, and engage with the travel community. Their experiences can offer invaluable perspectives and steer you away from common pitfalls.” 

FROM THE SPONSOR:
This summer, Carnival Cruise Line conducted a nationwide “Your Winning Plan” roadshow and competition for travel advisors. The educational initiative gave travel advisors the opportunity to learn from business experts from the U.S. Small Business Association, while at the same time competing for $20,000 worth of prizes. Carnival encouraged the participating advisors to develop business plans with a tool created in cooperation with America’s Small Business Development Centers, a partner of the U.S. Small Business Association. The advisors were then invited to submit their plans and compete for cash to use toward implementing them. More than one thousand plans were submitted during the program. One of the semi-finalists will be named as the grand prize winner when celebrated entrepreneur Daymond John, star of ABC’s “Shark Tank,” helps to conclude the series at a grand finale event in Houston on September 27. Carnival President Christine Duffy will join John during the event to discuss tips for entrepreneurial success, and he will name the grand prize winner during an onstage celebration. For more information call 800-CARNIVAL or visit www.goccl.com or www.carnival.com.