The tourism sector is a dynamic field that offers significant opportunities for our country both economically and culturally. Establishing a travel agency is one of the effective ways to evaluate the potential offered by this sector and be a part of a growing market. However, successfully operating an agency is not just about offering travel packages. It requires a solid business plan, compliance with legal procedures, innovative strategies, and sustainable approaches.
In this article, we will discuss in detail critical topics such as business plan preparations when establishing a travel agency, the requirements for opening a travel agency, costs, and crisis management. If you are considering starting an initiative in this field, this guideline will serve as a strong starting point for you.
Number of Travel Agencies by Year
Tourism is one of the largest sources of income for our country, and the number of travel agencies opened every year reaches record levels. According to the data from the Ministry of Culture and Tourism and TÜRSAB (Association of Turkish Travel Agencies), the number of travel agencies in Turkey reached 15,299 as of the end of 2023, with 13,021 as central agencies and 2,278 as branches. At this point, like any new business idea, opening a tourism agency is an endeavor that needs to be planned in detail and carefully. First and foremost, it is essential to know the market well to exist as a new company in the market and to promote your name. Analysis of the target audience, market needs, and competitive situation should be conducted before starting the business.
The foundation of every successful business plan is a detailed analysis of that business and the market it will grow in. Then, a business model should be determined. Questions need to be answered, such as whether the agency will have a corporate profile, who it will target, and whether it will focus on international or domestic travel. Following this, the capital should be determined. The minimum capital requirement varies according to the selected company type and license type. Sufficient budget should be allocated for operational expenses before starting the business.
How are Agencies Classified?
There are two types of travel agency classifications:
STRUCTURAL CLASSIFICATION:
Large distribution agencies: They usually market the products of tour operators and act as intermediaries between tour operators and travel agencies.
Specialized agencies for industrial firms: They organize travel, holiday, and ticket arrangements aimed at the needs and personnel of large enterprises.
Independent agencies: These are agencies that provide all services related to travel organizations without any affiliation.
Local agencies: They are agencies that generally sell their own products in active tourism regions.
Representative agencies: These are travel businesses that work on behalf of a particular travel agency in a specific region.
FUNCTIONAL CLASSIFICATION:
Incoming (receiving) agencies: They are local receiving agencies in the destination country. They welcome guests and organize necessary transfers and extra tour operations. In the evolving process, hotel accommodation agreements that need to be made are now fulfilled by agency staff instead of contract managers. Accommodation businesses also make hotel reservations or service sales through this local agency. Local agencies can also sell services to foreign tour operators either wholesale or retail by adding some services to these sales.
Outgoing (sending) agencies: These are agencies that send tours abroad from their own country. They organize tours abroad, and most of their clients are independent rather than group clients. Reservations taken from customers for outgoing tours are confirmed with accommodation businesses at least one month in advance. Operations in outgoing agencies are determined in advance and clearly. Administrative processes related to travel are carried out by the agency. Outgoing agencies function as small-scale tour operators. The profit margin may be higher for outgoing tours compared to incoming agencies.
What is the Cost of Establishing a Travel Agency?
The costs of establishing a travel agency vary depending on the company type, year, and other amounts. For example, for 2024, establishing a travel agency in the limited company type requires a capital of approximately 500,000 TL. You can calculate based on the information below:
Since sole proprietorships do not have to have capital, only the company establishment fees are paid. A minimum startup capital of 50,000 TL is required for limited companies, and 250,000 TL for joint stock companies.
In addition to the fees paid during the company establishment, TÜRSAB registration fees and annual dues are also paid. A one-time fee of 359,474.83 TL (according to 2024 data) is collected during the member registration process. The annual fee of 17,973.85 TL (2024) is paid according to the amount determined each year.
To obtain a travel agency certificate, a guarantee fee is paid to the Ministry. Guarantee fees vary according to the agency's group. Group A travel agency certificate costs 7,000 TL, Group B costs 6,000 TL, and for Group C, this amount is 5,000 TL. For each branch to be opened, 25% of the guarantees must be paid again.
Monthly expense items: VAT declaration stamp tax, SMMM accounting fees, temporary tax declaration stamp tax every three months, withholding tax, personnel salaries, and SGK payments. These amounts may vary depending on the company's type, annual fees, salaries, and revenues.
Our Agency is Established, We Want to Attract Customers from Abroad. What Should We Do?
At this point, we should start using classic digital marketing strategies. We should maximize international visibility through SEO, Google Ads, and social media advertising. Cooperation can be established with tourism agencies and hotels in target countries. Your website and customer service should provide services in the language of your target audience. You can create a network by participating in international tourism fairs. You can offer targeted campaigns to attract the audience.
How to Analyze Tourism Trends?
It is essential to follow the reports and data regularly presented by the Ministry of Culture and Tourism. The most official and reliable data at your disposal will be the reports provided by the ministry. Then, it is necessary to follow the accounts and blogs of well-known travelers both nationally and internationally on social media. This process will give us ideas about travel trends. Additionally, tourism fairs and conferences are opportunities to learn about innovations in the industry. Participation in such fairs is very important.
Crisis Management in Travel Agencies
Oh no, we have established our company, our business has opened, and we have customers from abroad, and suddenly a pandemic hit and shook the whole world. What shall we do now?
First, take a deep breath. As the COVID-19 pandemic has shown us, pandemics are one of the most suitable processes to prepare for the subsequent tourism boom. After lockdowns, the desire of people to travel is a very natural need. To navigate this process with minimal damage, you should closely monitor the ministry. You must not miss announcements and applications to benefit from incentives and grants offered during the crisis.
Additionally, flexible cancellation and change policies should be offered to customers. This will increase customers' trust in the agency. Working on income streams with services such as virtual tours and online guiding can also be an option. Furthermore, cost-saving plans should be developed to reduce operational expenses. Reviewing systems like working from home or hybrid working will be the most logical choice.
How to Optimize Online User Experience?
First of all, it is essential to attract customers with an easily understandable and practical site layout. Technical support should be taken to ensure that this site is mobile-friendly and works smoothly on mobile devices. With a user-friendly interface, we should ensure easy access to information like reservations and price comparisons. Offering special suggestions and campaigns for customers is also an important element in a strategic context.
Optimizing your site for users and yourself, integrating cost-effective applications with artificial intelligence, and ensuring hosting/storage needs can be discussed with us.
Is Sustainability Necessary for Company Development?
Sustainability has recently become an important element in the tourism sector. Organizing eco-tours for brand image can be a decisive factor in the eyes of customers. Additionally, transitioning to environmentally friendly methods in internal operations to reduce carbon footprint is also an important step. Prioritizing projects that support local communities in the destinations we serve may also be a solution.
What are the risks covered under tourism law and insurance?
The biggest problem for a travel agency will be customer complaints or canceled tours. At this point, the agency must take action to not harm the customer and to minimize its own losses. Policies should be arranged for situations like tour cancellations and customer accidents.
Non-compliance with tax and accounting regulations can also result in serious penalties. To prevent this, it is necessary to work with a knowledgeable financial advisor and accountant.
We tried everything, but it didn't work. How will we close the agency?
First, just like the closing process of every company, it is necessary to cancel the company registration with the trade registry. For this:
An application must be made to the provincial directorate of trade to which the company is affiliated.
- Then, we must officially notify TÜRSAB that we are in the process of closing the company.
- The file completed by TÜRSAB regarding the branch closure application is forwarded to the Ministry.
- If any deficiencies are found as a result of the review and evaluation conducted by the Ministry, information is sent to TÜRSAB for the completion of the deficiency.
- If the request is deemed appropriate, approval for the new status of the travel agency is prepared for document issuance.
- After authorization, a Travel Agency Operating Certificate is organized according to the new status of the travel agency.
- The issued travel agency operating certificate is sent to the relevant Provincial Culture and Tourism Directorate for delivery to the applicant, and the situation is reported to TÜRSAB.
- After the evidence of payment of the document fees to the accounts designated by the Ministry is presented, the closure document is obtained from the Provincial Culture and Tourism Directorate.
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