A GO-TO guide to discover the science behind starting a travel agency business in India: The most happening, lucrative, consistently growing, and extremely profitable business!
So accept our congratulations. You have already taken the very first step of researching your dream business.
After a long gloomy era of COVID19, the travel industry is going to recover at a very exciting pace.
Compared to other businesses, travel agency business requires lower start-up capital and resources. The ultimate requirement is your love and passion for selling travel.
TourismCEO offers you advice and guidance through various resources to support you on your exciting entrepreneurial journey!
So where do you start? How do you spread your wings and dominate your chosen segment of the tourism industry?
Here is the step-by-step guide to getting your travel agency off the ground:
The travel industry has a vast target audience, but within that target audience are smaller subgroups of people. They share certain traits and have specific preferences and requirements. These subgroups are called niches.
It simply means you must not try selling anything that comes your way. Instead, choose and dominate one very special segment of the travel industry.
Don’t get overwhelmed with the nature of travel products and services, otherwise, you may risk getting stuck into a never-ending process that often fails.
It’s understood that you may get a query of any nature considering you being a travel agent. But choosing a particular niche will immensely help you in the long run.
It will differentiate you from other travel agents and competitors.
First, you build your audience, then you can certainly sell them your add-on services later on.
Some examples may include skiing tours, rural tours, experiential travel, tours with gamification, night tours, women special tours, and many more.
Carefully evaluate your passion and skills, figure out if there’s a market for your niche, and then narrow down your niche.
Before rushing into the formalities of your business, you need to decide how you will source your products or services. You need suppliers and partners.
Here you have 3 options:
- Become an independent travel agent
- A home-based travel agent by partnering with bigger travel companies
- Travel agency franchise
All of these options are entirely different and you may choose any of these according to your vision or goals.
Becoming an independent travel agent requires great networking and liaising with the suppliers/vendors. You will be taking care of upfront costs, licenses, accreditations, marketing, bookkeeping, and technology.
On the other hand, if you choose to go with partnering with bigger travel companies such as online b2b travel agencies, your most important focus will only be the sales.
Generally, most of the b2b travel service providers offer access to ready-made travel services, technology, networking, education, and support.
Moreover, the start-up costs are way lower than any other means of setting up a travel agency.
But that’s not as easy as it sounds. Established operators ask a few questions and have certain criteria for getting associated with them.
And lastly, the Franchise model, the easiest way of entering into the travel business. Here you just pay the sum of money and fulfill the requirement of the franchisor, and you are good to go.
But still, you have to take care of various sales and marketing tactics to survive in your region.
There are many things that you need to look at before you choose a name for your new business.
You can use google for naming ideas. Various name-generating websites help you find the perfect name. Moreover, you can also ask some of your creative friends and family members to come up with a great and catchy name.
Before finalizing the name you must verify the availability of the name across the web, social media, and in the legal world.
You can choose among sole proprietorship, partnership, private limited company, Limited liability partnership (LLP), and one-person company (OPC).
The type of business entity you choose will depend on three primary factors: liability, taxation, and record-keeping.
Sole proprietorship and private limited company are the most sought after options for setting up a travel agency business in India
It’s always advisable to start with the least documentation requirement such as in the sole proprietorship.
You will always have the option of changing the business entity according to the need of the hour.
Ok, now that you’ve finalized your niche, come up with an awesome name, and settled on a business entity, the next step is to get it registered for GST.
Though it’s optional to have GST when your annual turnover is below 20 lakhs (10 lakh for Northeastern states). But it’s strongly advisable to register for GST as skipping it will punish and bar you in various ways.
Getting your trademark registration is also advised to make sure nobody uses your brand name.
Govt of India had recently published new guidelines for travel agents and tour operator’s registrations.
The new scheme has made it a lot easier to apply for government recognition. Application for new registrations and renewals can be filed online, saving a lot of time and energy.
Tourism departments of all the states/UT also offer registrations on the state level which you can check with your respective state departments.
We have seen a lot of fresh graduates and business newcomers, who wasted a lot of time and energy on figuring out a well-looking and well-designed business plan.
They fill their business plan with a lot of theories and cliches, and it becomes impossible to look at those plans after a little while.
Be honest with your future, instead, try preparing a REALISTIC and typically 01-page business plan.
You will need to keep your business and personal money separate. You should not mix your finances.
If you are paying personal bills out of your business or current account, or vice versa, it will be counted as personal liability that might incur losses in the long run.
Various banks in India offer specialized services for travel business owners.
Moreover, there are numerous loans that you may consider as you grow. Indian banks are reluctant to offer any loan to a fresher business owner. But there are other ways to get it.
The Ministry of tourism also introduced some schemes that may benefit you in the future like marketing development schemes and brochure support schemes to name a few.
If you are looking for walk-in clients then a perfect location is the key that might cost you higher. But in the case of selling services online, no such offices are required.
You can set up an office at your home or any co-working space near you.
Co-working spaces offer you a great environment as well as like-minded business owners. Nowadays co-working spaces offer you virtual spaces, meeting rooms on-demand, fixed spaces, casual desks, and much more.
In case you don’t want to go to the office every day, you can also book your seat on a per-day basis. There is a lot of flexibility that you can utilize when you choose a coworking space.
And you certainly move to bigger spaces once you are ready for it.
Phew. That list was a little overwhelming wasn’t it? But the actual groundwork starts when you step into the real-life scenario.
You just need to come up with some great sales and marketing tactics to achieve your dreams.
Here at TourismCEO we always keep on posting stuff that helps a travel business owner in any sense.
Marketing, sales, and networking are our favorite topics and will be yours also once you enter into the travel business.
We wish you luck with this beautiful entrepreneurial journey! Cheers!