Tours Travel

What is a Tour Broker and how to become one

A person who operates a tourism business is a broker. A broker is an intermediary. Brokers buy or arrange items or services and sell them to the ultimate buyer. Some examples of intermediaries are:

Independent insurance agents. These agents do not offer insurance; arrange insurance for you from an insurance company. Insurance agents typically receive a commission from an insurance company.

Stockbrokers. Like insurance agents, stockbrokers help you buy and sell stocks. They do not own the shares. These brokers also receive a commission based on the amount sold.

real estate agent. Again, these brokers do not own the properties they sell and they get a commission based on the value of what they sell.

There are also travel agencies. Tour brokers serve a variety of customers. This article is about what a travel agency is and the basics of this business.

Here is a good description of what a tour is: A trip with visits to various places of interest for business, pleasure or instruction.

Travel is defined here: Going from one place to another, as on a journey; ride.

A trip, then, is not just a trip, but a trip with the purpose of being of pleasure or interest. You can think of a tour as an extended trip whose goal is to see and experience an area. Traveling, on the other hand, is usually just about moving from one place to another.

A tour agent works with people on an ongoing basis. If he is going to get involved in this kind of business, he would like to work with people: he must be a people person.

Travel brokers are not travel agents. Travel agents organize the travel needs of their clients. Typically, a travel agent will only work with individuals or small groups (families, for example). Travel agents also always buy something that is already in the works (air travel, car rentals, hotels, etc.), they do not originate anything.

Tour agents originate: they organize tours, arrange transportation, arrange accommodation, arrange meals, and arrange other services for their clients. A travel broker plans what type of trip he wants to operate.

Next, the tour agent organizes the various components of the tour: transportation, food, accommodation, attractions, etc.

There are many types of tour companies. Some offer guided tours of a local area, tours of a city or an attraction, for example. Some offer tours in a natural environment; guided tours of the Grand Canyon fall into this category. Some offer tours to various national and state parks. Some offer tours of a large area, a multi-state tour is a good example.

IF YOU LIKE TO TRAVEL – FOR FREE – THIS IS A GREAT BUSINESS TO BE IN

You may be required to conduct inspections of the hotels and attractions that will be part of your tour. If you’ve been taught correctly, you’ll know how to get “comp” (short for free) rooms and meals. If you continue with the tour, you should expect to get freebies again. How to set it up so you get freebies is something your mentor should teach you.

PLEASE NOTE THAT THE INFORMATION PROVIDED HERE ONLY APPLIES TO THE UNITED STATES. OTHER COUNTRIES MAY HAVE DIFFERENT RULES

As I mentioned before, this is a people business. Having a taste for working with people and a taste for solving problems is a primary requirement.

Just as a church is a church because someone calls it a church, a tour agent is a tour agent because someone says they are a tour agent. There is no requirement for a license. If you operate a business, you may be required to obtain a federal tax identification number and your county or city may require you to obtain a business license. As for the need for a license to become a tour agent, a license is not required. From the mid-1930s to the 1980s, transportation was strictly controlled by the Interstate Commerce Commission (ICC). Under the Deregulation Act of 1982, competition was allowed and the need for federal authority became a thing of the past.

Depending on where you are, you may need some type of business license. Call your local county office and ask for the office that handles business licenses. This should be easy, as all they really want is for you to submit a few documents and pay them a small fee.

If you’re going to make money (and why else go into business?), you’ll need to get a federal tax identification number. This number is called a Tax Identification Number (TIN) and is used in business much like your Social Security number is used for benefits.

I have looked at various sites on the internet that claim to be concerned with how to become a tour operator. Most don’t seem to understand what a tour operator is or does. Those who have come close to the concept offer to teach or provide links to sites that can prepare someone to be a tour guide. A tour guide is not a tour operator; At best, a tour guide works for a tour operator.

A tour operator runs his own business.

It’s as simple as that: you own and run the business. If you plan to make a profit, follow this rule: buy low, sell high. People tend to make things too difficult. You buy at one price and sell at another price, easy, huh?

The real “trick” to making money in the touring business is to understand the concept of equilibrium (BE). The break-even point is where you don’t lose money and where you don’t make money. To help you understand this idea, you need to understand that there are two types of costs in most businesses: fixed and variable. A fixed cost is one that will occur whether you have 10 clients or 46. Office rent is a fixed cost. You have to pay rent whether or not you operate any tours. A variable cost is a cost that depends on something else. An example of a variable cost would be the cost of an attraction (theme park). If you have 20 customers, the total cost of the attraction depends (varies) on the number of customers you have.

The lack of good information about this business led me to believe that those in this business either don’t want competition or don’t have the time to write about how they run their business. A well thought out tour, advertised correctly, can generate thousands of revenues. For example, suppose you operate a seven-day bus tour. The tour sells for $985.00 (per person, double occupancy) and has 36 people on your tour. The gross receipts from this tour will be over $35,000.00 and you should be able to keep at least $10,000.00 of that amount.

IS THIS THE KIND OF BUSINESS FOR YOU?

It is possible to make a lot of money in this business; you could also lose money. Here are some basic requirements that you must have before starting such a business.

You must like working with people.
You should not panic when things go from good to bad or even worse.
You should be able to organize things easily.
You must have at least a working knowledge of certain computer programs: word processing, spreadsheet, email
You must have a photocopier and a fax machine.
You must have at least one phone
You must have at least one fairly up-to-date computer

What kind of tours and what should I do next?

The world is your oyster

This is really the fun part: you can go anywhere! Successful racers operate three-day tours from Denver to the nearby Rocky Mountains and seven-day tours to Branson, Missouri. East Coast Racers offer tours of New England and parts of eastern Canada, as well as longer tours of the southwestern United States.

Brokers in Seattle do a brisk business operating tours in Mexico’s Copper Canyon. Some brokers offer visits to music events, art shows, and short trips to New York City for holiday shopping.

Where to go is up to you, as long as you keep it reasonable. Going to Iraq now may not be the best option, but there is a company in the UK that offers and operates tours to Iraq – make sure your clients sign plenty of declarations stating that you are not to blame in the event of their death. Given the current state of the economy, it may be prudent to limit your offerings to North America, but trips to Costa Rica seem to sell very well.

To learn more about this exciting business, click here.

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