TRAVEL AGENCIES

A travel agent is a person who has full knowledge of tourist product – destinations, modes of travel,
climate, accommodation, and other areas of the service sector. He acts on the behalf of product
providers/principles and in return gets a commission. Technically, a travel agent is an owner or
manager of an agency, but other employees are responsible for advising tourists and selling
packages tours/individual components of travel products.
A travel agent may be an individual /firm or corporation which is commonly known as a travel
agency. An agency means the office of travel agent or organization where all travel goods and
services are assembled and coordinated for the smooth conduct of travel agency business.
Travel agency is one of the most important organizations in the tourism private sector which plays a
significant and crucial role in the entire process of developing and promoting tourism in the country
or at a destination. It is a travel agency which packages and processes all the attractions, accesses,
amenities and ancillary services of a country and present them to tourists. That’s why travel agency
is known as ‘image builder‘ of a country.
A prospective travel agency is one which makes arrangements of travel tickets (air, rail, road, and
sea); travel documents (passports, visa and other documents required to travel); accommodation,
entertainment, and other travel-related services from principle suppliers. It may also secure travel
insurance, foreign currency for traveling people.
History of Travel Agency
The first Travel Agency of the world was established by Thomas Cook in 1845 in England. The use of
the term travel trade dates back from the early years of the 19th century, but this should not
obscure the fact that what we today describe as travel trade (travel agency and tour operation
business) was taking place much earlier in history.
Throughout history, there was travel middleman who helped the merchants traveling for trade and
others who traveled for religious purposes .
In 1841 a fortunate day comes in the history of travel trade when Thomas Cook, as secretary of
South Midland Temperance Association, organized a trip by a train for 570 members for his
association to the distance of 22 miles. He bought railway tickets in bulk to sell them to people.
The experiment was successful and everybody was exultant. Mr. Cook had done his job on a no-
profit basis. But, incidentally, It gave him a new idea and turned it into a tour business.
Four years later in 1845, he set up a ‘World’s First Travel Agency‘ to organize excursions. Due to this
innovative approach, Mr. Thomas Cook is known as the Father of Travel Agency Business. He co-
ordinated railway and steamship excursions throughout England, Scotland and Europe.
However, the railways only gave him a 5% commission which was not enough to meet his overheads,
so he decided to diversify this business into tour operation.
In 1855 Mr. Cook started operating package tours. He conducted the world’s first international
tour from England to Paris.
Types of Travel Agency
Travel agencies are basically categorized into two types-: Retail Travel Agency and Wholesale Travel
Agency.
Retail Travel Agency
A retail travel agency sells tourists products directly to the public on the behalf of the products
suppliers and in return get commissions. Some package tour is sold in two ways i.e., on a commission
basis and mark up the price.
When a travel agency sells a tour on the marked-up price it means that first, it markup the cost of
the tour and then sell it at a higher rate. The markup price is the difference between retail price and
wholesale cost.
Wholesale Travel Agency
These agencies are specialized in organizing package tours, which are marketed to the
customers/tourists through the network of a retail travel agency or directly to the prospective clients
( if wholesale travel agency has a retail division). A wholesale travel agency purchases tourists’
product components in the bulk and designs tour packages.
Sometimes, a wholesale travel agency buys travel components from the vendor in bulk and resell
them to other travel business originations.
Wholesale travel agencies assemble package holidays and sell them to clients through retail travel
agencies. A typical package tour includes – air tickets, accommodation, and something other services
may also be included in it such as entertainment, sightseeing, and sports activities, etc.
These packages are referred to as ‘package tours’ most of these tours include the services of escorts
but a few are sold to people who wish to travel independently.
Difference between Wholesale Travel Agencies and Tour operators
The wholesale travel agencies may offer or operate the package tours or may specialize in
developing tours for inbound as well as outbound travelers. They are often referred to as tour
operators, but these two essentially different:
1. Wholesale travel agency does not sell directly to the public, while tour operators do
sell directly to clients.
2. A wholesale travel agency usually combines, assembles and contacts for existing
travel services to formulate a new travel product she has his own one or more
components of travel product i.e. ‘ inclusive tours.’
3. Wholesale travel agencies are less inclined than tour operators to perform ground
services i.e. handling agency or ground operators.
4. A wholesale travel agency may deal with one component of travel product while a
tour operator offers a variety of tour programmes.
1. The size of the business is large in the case of tour operators in comparison to a
wholesale travel agency.
Features and Importance of the Travel Agency
Travel agency plays an important role in the travel sector business. Some most important features
and importance of the travel agency business are following as:-
1. An important link between the clients and principal suppliers.
2. Image-Builder.
3. Ensures rapid travel services.
4. Provider of authentic and reliable travel information.
5. A social a continuous process.
6. Establishes a good relationship with clients and vendors.
These are the most important features of the Travel Agency Business.
Functions and Services of Travel Agency
Today, Travel Agencies have been recognized as a vital component of travel and tourism and have
become an integral part of the travel and tourism industry at globally. They account for more than
90% of international and 70% of domestic tourist traffic. Functions of travel agencies are
Travel Information
Whatever the size of a travel agency, it has to provide necessary travel information to tourists. A
travel agency must give up-to-date, accurate, and timely information regarding destinations mode of
travel, accommodation, sight-seeing, shopping, immigration, passport, visa, customs clearance and
procedure, health and security rules, and various permits required to travel in particular areas, etc.
Itinerary Preparation
The term tourists itinerary is used to identify the origin, destination and all the stopping points in a
traveler’s tours. It is a composition of various elements and designed after a detailed study of the
market. Travel agencies prepare an itinerary for tour packages.
Airline Ticketing and Reservation
A travel agency sells a variety of tourism products. Airline ticketing and reservation is still a major
source of revenue. Travel agencies perform a function of airline ticketing and reservation on behalf
of various airlines.
Tour Packaging and Costing
Travel agencies prepare a tour package and sell them to tourists. The coasting and pricing of tour
packages depend to a large extent on the ability of travel agents as to how effectively he is able to
negotiate with the principal suppliers.
Reservation
It is a very important function of all types of travel agencies. A travel agency consistently makes
linkage with the accommodation sector, transport sector and other entertainment organizations to
reserve rooms, and seats in the cultural programs and transportation.
Travel Insurance

Some large-scale travel agencies perform additional functions to serve their clients. Travel insurance
protects travelers against the person as well as baggage losses resulting from a wide range of travel-
related happenings and problems.
Currency Services
Approved travel agency authorized by Govt. body provides currency exchange services to tourists.
Organization of Conference/Conventions
Large-scale travel agencies offer a complete convention/conference package which includes
registration of the participants at the venue to be picked up for dropped to the airport/hotel,
overhead projectors, slide projectors, TV, VCR, information counter, sightseeing, etc.