I’ve never used a travel agent to book any of my trips. I have always preferred to hunt out deals for myself, instead of paying a fee for the convenience of having someone else do it for me. I never believed that travel agents are worth investing in until I started thinking about how it all works. Here is what I found, a quick, 101 guide on whether it is worth using a travel agent to book your next trip.
The question about prices
The agreement between service providers (like restaurants and activities providers) and travel agents influences whether using a travel agent to book your next trip will work out more expensive, the same, or even cheaper than booking directly with the service provider. When working with service providers, travel agents usually negotiate fees based on either STO rates or Rack rates.
STO rates stands for Sell to Operator. This is the rate that the service provider would like to receive for the room or service provided. The travel agent then adds a commission on top of this rate in order to cover their costs and make a profit. For example if the service provider requires $20 and the travel agent works on 20% commission the guest will end up paying $24.
Rack rates is the rate that the hotel or service provider thinks the guest should pay. The travel agent then takes their commission from the rack rate before paying the difference to the service provider. For example if the Rack rate is $20 the guest will pay $20, the travel agent will get their commission ($40 if it is set at 20%) and the service provider will receive $16.
If the service provider does not offer the travel agent their preferred commission on Rack rates (20% for example), the travel agent will need to increase the rate offered to the guest to increase their commission. For example if the hotel offers only 10% and the travel agent needs to get 20% to make a profit, the rack rate could be $20, the service provider will receive $18 while the guest will pay $22.
Whew… Now that we got that out of the way- what’s in it for you?
The main reason that many people chose to use travel agents is because of the convenience that they offer. Travel agents can book your trip from start to finish. They can book flights, accommodation, excursions and special activities (think romantic dinners on your honeymoon) for you to enjoy on your holiday. If you go with a good travel agent they can offer flexibility on your trip and deal with flight and accommodation booking changes – sometimes (but not always) with lower or no penalties to be paid.
Because travel agents have good relationships with their service providers, they can sometimes provide their clients with special perks. They could be able to negotiate some complimentary services like Champaign waiting for you in your room on arrival, spa services or excursions.
Good travel agents strive to find the best possible rates for their guests. They do the leg work so that you don’t have to – saving you time and hassle. They are also familiar with the seasons and know about specials being run by service providers in your destination of choice.
Travel agents can provide you with all the information you require about your travel destination. They know the latest requirements for VISA’s, vaccines, dress codes (for conservative countries or religious sites), updated exchange rates and travel warnings. They might also be able to provide you with information on lesser-known destinations.
The ugly
Travel agents sometimes have direct access to an airline’s inventory and thus can book flights directly. To do this they need to have an International Air Transport Association (IATA) or Cruise Line International Association (CLIA) number. Furthermore not all airlines are on these booking engines, meaning that sometimes, in order to get you the best price, your travel agent might not be able to book you on your preferred airline (or the one where you could earn the most frequent flyer miles).
Here comes in the guys at expertflyer.com they have created a system that gives you inside information and access to flight prices, routes and seating/meal options. Now you can be your own travel agent when booking a flight as you have access to all the same information.
Travel agents haven’t always been to the places that they promote. Thus they might not have first- hand experience of the area. They work for commission which means that they work with providers that they know of. Although they always try to find the best fit for guests, there might be other options that they are unaware of. The commission could also be an incentive to recommend one provider over another.
While the general impression is that booking through a travel agent is more expensive, it might not always be the case as travel agents hunt for the lowest prices and have ‘inside information’ on when their service providers might be running promotions. Having said that, it is still possible to get a great deal on your own. The toss up here, really is whether you want to spend hours (sometimes up to 30 or more) or whether you want to go for convenience.
*A version of this article first appeared at www.zafigo.com. This article might contain affiliate links and I could get a small percentage of sales made through them. It helps me to keep the site going, and I thank you.
