Most Travel Advisors Are Charging Fees

The majority of travel advisors now charge professional fees, according to recent Need to Know research conducted by TravelAge West. Nearly two-thirds of respondents (62%) charge fees, and 89% feel the decision to implement them was a success overall.

“After coming out on the other side of COVID-19, my business model changed to charge fees,” said Katie Ehlers, a travel advisor with LuxTravel Katie, an affiliate of Classic Travel Connection. “In my business, where I was pouring my heart and soul into clients who I didn’t have a secured partnership with — and for them to take all of my information and book it themselves — was just work I was not willing to do anymore. By creating that partnership where my clients hire me for my services, it creates a closer connection, and I can work with my ideal clients every day, while also being compensated for my time and my work on the front end of my clients’ travels.”  

By creating that partnership where my clients hire me for my services, it creates a closer connection, and I can work with my ideal clients every day.

Most (64%) of the advisors who charge fees say their clients generally have no problem with the practice. However, advisors are split on whether they may have lost business as a result of fees — and if that matters. Forty-seven percent say they may have lost business, but find that acceptable; 46% do not think they lost any business because of fees. 

“Have I lost business? Of course,” Ehlers said. “However, those customers are not my ideal clients, and I would not partner well with them anyhow. So, I take it with a grain of salt and move on, knowing that now, I have more time to focus on someone who wants to hire me for my professional knowledge, and partner together to make their travel dreams come true.” 

RELATED: ASTA Endorses Travel Agent Fees as Part of New Credo of Beliefs  

Most advisors (54%) make between $50 and $150 on fees per client, with another third (35%) making $150 to $300 per client. 

Of the advisors charging fees, most (70%) were charging fees before the COVID-19 pandemic, but nearly one-third (29%) started charging fees since the pandemic began. And most advisors (53%) have not raised their fees in the past year.

For most advisors (53%), fees make up less than 10% of their overall business mix, with another 27% saying the amount is between 10% and 25%. The most common fee is a general booking fee (87%), followed by change fees (47%), cancellation fees (42%), group booking fees (33%) and concierge fees (33%). Only 6% charge an hourly fee. 

RELATED: How Travel Agencies Are Rethinking Fee Structures  

The majority of advisors (56%) charge both standard fees and variable fees. Nearly all respondents (91%) say their fees are nonrefundable.

The top reason why some advisors do not charge fees is because they do not feel it’s necessary to their business (38%), followed by being afraid it will deter new clients (24%) and scared that it will anger current clients (17%).

Most advisors who do not charge fees are considering charging them in the future — 59% say they are either very likely or somewhat likely to initiate fees eventually, while 41% say they are not likely to do so.

“For the most part, I have not had any pushback from my clients, returning or new,” Ehlers said. “I have had a few people who have either not responded or have written back that they will take a different, ‘free’ route, and I make it a point to respond. I explain why I charge a professional fee, I wish them the best and I say that I will always be here should they change their mind. Moving forward, advisors need to educate clients and put it into perspective that the professionals in their daily life deserve to be paid for their services.”