Red Flags to Watch for When Choosing a Host Agency

In many professions, there is a well-worn path to securing a position and starting the job with confidence. Teachers earn a credential and practice their skills as student teachers. Nurses complete an accredited program, pass requisite exams and get a license. For travel advisors, things are less clear. To get the support they need to launch their career, advisors often turn to a host agency.

A good host agency provides training, marketing tools, booking technology, leads and mentorship opportunities. They also supply an IATA number with which to do business, and Errors and Omissions (E&O) insurance to protect that business. But, in a sea of options — there are nearly 300 hosts listed on Host Agency Reviews (HAR), a well-known online resource — how can advisors tell which one is a good fit for them?

Every so often, a host agency looks fine on paper but turns out to be dubious in real life. We spoke with four advisors who joined a host and eventually left. Here’s what happened, and a few tips they recommend fellow advisors follow as they navigate the selection process. Due to the sensitive nature of their stories, the advisors’ names have been changed.

Commission Troubles

Olivia wanted to find a host agency that would truly get to know her when she initially joined the industry. She looked past the larger and most established agencies, where she felt like she’d be “just a number.” Assured that she would get personalized support, she joined a newer host that had just four agents.

“At first, the agency owner gave me one-hour sessions on branding myself, fixing my website and so on,” Olivia said. “What I didn’t know was that she had not established an efficient way to track commissions. She was really good at selling herself and getting you into the agency, but lacked the manpower to handle actual sales and pay out on time. Since I was so new, I didn’t know it wasn’t normal that she took six months to pay a commission.”

Olivia watched as the agency’s backlogged commissions came to a head — one year after she joined, her host disappeared. She lost about $2,000 in commission, and one of her colleagues reported losing $20,000.

Commission troubles also came to haunt Eileen, who worked under a larger host agency for almost eight years. There were about 100 agents when she joined and around 600 when she left. As the agency grew, Eileen took on leadership roles, including creating and spearheading a training program for peers. She was a million-dollar seller at the same time. But after years of relatively smooth sailing, her commissions stopped being paid out as and when expected.

“I ended up contacting suppliers to find out if they had paid the commission on their end,” she said. “And suppliers are very quick to send you a copy of the check and when it was cashed, because they want their agents to know that they do pay.”

When Eileen’s agency continued to insist she’d been paid properly, despite her being able to prove otherwise, she ended up leaving the host and hiring an attorney. The case didn’t go to court, though; her state’s Labor Department got involved, and the agency ended up paying Eileen her earnings, plus interest. Unsurprisingly, the host agency’s behavior resulted in mass departures. Eileen estimates that about 200 of her colleagues left within the same year.

Punitive Actions

Kerry was the top seller at her host agency for several years in a row. She eventually felt she needed to make a move; she’d grown her book of business and was ready to spread her wings. But the agency owner wasn’t that type of mother bird.

RELATED: 5 Key Factors to Consider When Choosing a Host Agency

“I was afraid to have that conversation, because the owner was so emotionally wrapped up in everything,” Kerry said. “I knew that there would be some anger, and I had no idea if my tens of thousands of dollars in commission would be paid out or not.”

Kerry looked at her contract and noticed how vague the language was around leaving the agency and how that impacted commission. When she got the courage to report her departure, things seemed fine. Later, small retaliatory actions occurred.

If somebody’s getting huffy and puffy about you asking questions, that’s probably a red flag.

“For example, if there was any sort of mistake in the CRM [customer relationship management system] — like a booking had two confirmation numbers and I had put one in but not the other — she would refuse to pay,” Kerry said. “Because I was no longer with the agency at that point, she had more leverage. So, I did lose a couple thousand dollars.”

Another advisor, Margot, found herself ready to leave a host agency after just nine months. As a Disney specialist, Margot had been enticed by her host’s Disney EarMarked status, but once she had her foot in the door, she didn’t like what she saw. Departing seemed risky, though; rumor was that the agency owner tried to avoid paying any advisor who started booking travel elsewhere.

“I was working with a really large group booking — a themed affinity cruise with more than 300 people sailing — and I couldn’t leave that behind,” Margot said.

So, she focused on the cruise group and scaled back on other bookings by sending leads to colleagues. Still, her worst fear came true.

“My contract was forcibly terminated on the day the large payout for my group booking was due,” she said. “I still have not received payment.”

Six months later, Margot started her own business from scratch.

In hindsight, all four of these advisors see things they missed when originally selecting a host, but they also recognize that some pain points only revealed themselves once they had joined. Here’s what they suggest advisors do when researching hosts.

Tip #1: Get a Feel For Company Culture

Only so much information can be gathered by surfing a host agency website. Reading reviews on sites such as Better Business Bureau and HAR is a common step, too, but Eileen says it’s wise to remember that some hosts ask their agents to post positive testimonials. So, going beyond this and personally connecting with advisors already on a host’s team is a good idea.

“What other agents say about a host’s level of service and professionalism can speak volumes about what your experience will be like when you join,” Olivia said.

Advisors might also schedule a meeting with someone on the host agency’s leadership team, since company culture often starts at the top. Talking in person, or over Zoom, allows an advisor to ask both easy and tough questions and to read the representative’s facial expressions, tone and energy as they reply. Do they make you feel foolish for asking questions, or do they welcome your inquiries? Do they provide direct answers about commission splits, or skirt around the topic? Do they appear generous with their time?

RELATED: A Travel Advisor's Guide to Smart Hiring

“If somebody’s getting huffy and puffy about you asking questions, that’s probably a red flag,” Kerry said. “I would also be wary of any host that makes it feel like they’re interviewing you, and that you’d be lucky to join them.”

Some cultural traits may not reveal themselves until an advisor is already “deep in,” Eileen says. But asking hard questions before joining provides a peek behind the curtain. It’s especially important to try to uncover how people on the team speak to one another, what happens when someone makes a mistake and how supported people feel when learning something new.

Another thing to ask about is advisor/supplier relationships. Kerry’s host, for example, didn’t encourage independent contractors (ICs) to build rapport with suppliers; the owner preferred things to be funneled through her, and in the case of a Disney business development manager, contact was practically prohibited. This thwarted Kerry’s ability to foster long-term connections with sales representatives — which might make any advisor nervous to leave a host and start fresh.

Tip #2: Verify That The Host Offers the Support You Need

Advisors brand new to the field will need training on industry fundamentals, from how to use the Global Distribution System to how to build quotes and bill clients. Ensuring a prospective host is prepared to provide support on a wide range of subject matter is key — and a lack of training options is a red flag.

When Eileen left her host and started her own agency (she now has 16 ICs working with her), she almost immediately instituted a 12-week training program. Advisors can alter the pace to suit their needs, but they cannot start selling until it’s completed. Her reasoning? The program arms every agent with a breadth of knowledge that helps them do the job well.

“I have an advisor who recently left her old agency, where she had only ever sold Disney,” Eileen said. “She sold around $40,000 in travel a year. Since coming to my agency in November, she has sold everything from cruises and Europe trips to Disney, Universal and Grand Canyon Railway vacations, and she’s booked almost $200,000 in sales. That’s what real support can do.”

Olivia says that reachability is important, too. If any advisor has a clarifying question, who do they go to, and how quickly can they expect a reply? Ideally, a host has enough mentors to support the number of mentees on the team.

“I’ve heard of agencies where the sales team is overactive and easy to reach, but once a contract is signed, the actual service team is nonexistent,” she said.

A team’s level of generosity with its members is harder to determine before onboarding with a host. Kerry now has eight ICs in her own agency, and she is passionate about their growth and shares all kinds of tools, materials and strategies with them. They have access to her curated resource website, and she regularly invites them to online “huddles” with a specific focus; a recent one was all about cruise client workflow.

RELATED: This New West Coast Host Agency Wants to Redefine the Luxury Travel Advisor Experience

Eileen models a similar strategy with her ICs.

“I don’t see the point of holding in information,” she said. “If we give all the tools necessary for our agents to succeed, it’s better for everybody. And if that means I give them all the work that I’ve created over the last 10 years, then so be it.”

Tip #3: Take the Long View

No one can predict the future, but advisors might attempt to foretell how a particular host will help or hinder them as their business grows. For example, advisors might look at the number of agents in a host and their total sales volume; a host with many ICs but very low booking volume is going to have a different relationship with suppliers than a host with a small number of top-producing agents.

Olivia says to note if a host is part of a consortium, and to ensure that the organization aligns with your future goals. This thought came to her after joining her second host.

“This host is part of a consortium I don’t favor, but switching now is very hard,” she said. “I want more luxury bookings, but my current consortium lacks the connections I need to wow luxury clients.”

And if an advisor finds themself in an agency that just doesn’t fit — even after reading reviews and asking clarifying questions — Shayna Zand, managing director of HAR, suggests that the advisor embrace change.

You want it to be a partnership that works both ways.

“A restaurant can get incredible reviews and you can go there and not have a great experience,” she said. “The same is true for a host. But you can switch; it’s not impossible.”

And departure isn’t always dramatic. Plenty of hosts support an advisor leaving their ranks, as a poor fit benefits no one.

“You want it to be a partnership that works both ways,” Zand said. “But there are hundreds of hosts and thousands of advisors. You’re not always going to pick the right one.”

Tip #4: Read the Fine Print

Reading a host’s contract is critical. Advisors should take the time to reflect on every line in the document and get clarity when something is murky. Note any omitted details, too, and address them before signing.

Zand recommends consulting a lawyer to review the contract. The American Society of Travel Advisors has an Attorney Referral Program, where advisors can find a vetted professional to work with.

When looking over the contract, pay attention to fees, commission splits and termination clauses. Host fees vary, and advisors will want to know what a fee covers (Eileen charges her ICs a fee that includes the costs of agent Gmail accounts, the agency’s CRM software and E&O insurance). A termination clause paints a picture of what an advisor’s exit from a host might be like. Many hosts offer a tiered commission structure, giving advisors more commission as they make more sales. Oftentimes, commission splits are lower if an advisor accepts sales leads, so ask how a host handles that. Some hosts have a commission cap; if a contract stipulates that advisors max out at an 80/20 split, applicants need to know that.

Something else to know, according to Margot, is how a host handles fam trip opportunities, from who gets to go on the trip to what kind of output or content is expected from attendees. And Eileen cautions against unreasonable requirements around social media. It may be a red flag if a host demands to be an administrator on an agent’s business Facebook page, for example, and/or attempts to control posts.

Silver Linings

Olivia, Eileen, Kerry and Margot may not have liked how their first host experiences ended, but they walked away knowing more than when they started — and missteps often move a person toward something better.

For Margot, leaving her host set her on the path to building her new agency, which celebrates one year in business next month.

“I’m more successful and happier than I’ve ever been as an advisor,” she said. “I’ve proven that this can be an incredible career with the right base and the right systems in place. And I’m grateful for that.”