A person who operates a tour company is a broker. A broker is an intermediary. Brokers buy or organize items or services and sell those items or services to the end buyer. Some examples of brokers are:
Independent insurance agents. These agents do not provide insurance; They provide insurance for you from an insurance company. Insurance agents usually receive a commission from an insurance company.
Stock brokers. As insurance agents, stock brokers help buy and sell stocks. They do not own the stock. These brokers also receive a commission based on the amount sold.
Realtor. Again, these brokers do not own the properties they sell and receive a commission based on the value of what they sell.
There are also tour agents. Tour brokers serve a variety of clients. This article is about what a tourism broker is and the basics of this business.
Here is a good description if what a tour is: A trip with visits to various places of interest for business, pleasure or instruction.
Here the trip is defined: To go from place to place, as in a trip; trip.
A ride, then, is not just travel, it is travel for the purpose of pleasure or interest. You can think of a tour as an extended trip aiming to see and experience an area. Travel, on the other hand, usually only involves moving from one place to another.
A tourism broker works with people on an ongoing basis. If you are going to be involved in this kind of business, I would like to work with people – you must be a people person.
Tour brokers are not travel agents. Travel agents organize the travel needs of their customers. Typically, a travel agent works only with individuals or small groups (families, for example). Travel agents also always buy something that is already in place (air travel, car rental, hotels etc.), they do not originate anything.
Tour brokers originate – they arrange tours, arrange transportation, arrange accommodation, arrange meals and arrange other services for their clients. A tourism broker plans what kind of tour he / she wants to operate.
Then the tourism broker arranges for the various components of the tour – transportation, food, lodging, attractions etc.
There are many types of tour companies. Some offer guided tours of a local area – visits to a city or attraction, for example. Some offer tours in a natural setting – 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 tour of several states is a good example.
If you like to travel – for free – this is a great deal to be with.
You may have to do inspections at the hotels and attractions that will be part of your tour. If you have been taught correctly, you will know how to get "comp" rooms and meals (free or short for short). If you are accompanying the tour, you should expect to get comps again. How to set it up so you get comps is something your mentor should teach.
NOTICE THAT THE INFORMATION PROVIDED HEREIN APPLIES TO THE US. OTHER COUNTRIES MAY HAVE DIFFERENT RULES
As I mentioned before, this is a business of people. Enjoying working with people and enjoying problem solving is a prime requirement.
Since a church is a church because someone calls it a church, a tourism broker is a tourism broker because someone says it is a tourism broker. There is no requirement for a license. If you run a business, you may need to obtain a federal tax number and your county or city may require you to obtain a business license. As much as you need a license to become a tourism broker – no license is required. From the mid-1930s to the 1980s, transportation was strictly controlled by the Interstate Trade Commission (ICC). Under the 1982 Deregulation Act, competition was permitted and the need for federal authority became a thing of the past.
Depending on where you are, you may need some kind of business license. Call your local county office and request the office responsible for commercial licenses. This should be easy, because all they really want is for you to file some paperwork and pay a small fee.
If you are going to make money (and why else go into business?), You will need to get a federal tax number. This number is called the Tax Identification Number (TIN) and is used in business just as the Social Security number is used for benefits.
I looked at several websites that wanted to worry about becoming a tour operator. Most don't seem to understand what a tour operator is or does. Those who approach 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 that simple – 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 very difficult. You buy for one price and sell for another price, easy, right?
The real "trick" to making money in the tourism business is to understand this concept of a tie (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 companies – fixed and variable. A fixed cost is one that will occur if you have 10 clients or 46. Office rent is a fixed cost. You must pay the rent, regardless of whether or not to operate tours. A variable cost is a cost dependent on something else. An example of variable cost would be the cost of an attraction (theme park). If you have 20 clients, the total cost of attraction depends (variable) on the number of clients you have.
The lack of good information about this business has led me to believe that those in this business do not want competition or have time to write about how they run their business. A well thought out, properly advertised tour can generate thousands of revenue. For example, suppose you operate a seven-day bus ride. The tour sells for $ 985.00 (per person, double occupancy) and you have 36 people on your tour. The gross revenue from this tour will exceed $ 35,000, and you can retain at least $ 10,000 of this amount.
IS THIS A BUSINESS CLASSIFICATION FOR YOU?
It is possible to get some serious money in this business – you can also lose money. Here are some basic requirements you must have before starting such a business.
Would you like to work with people
You shouldn't panic when things go from good to bad and 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 copier and a fax machine.
You must have at least one phone
You must have at least one highly updated 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 brokers operate three-day tours from Denver to the nearby Rockies and seven-day tours to Branson, Missouri. Brokers on the east coast offer tours to New England and parts of eastern Canada, as well as longer tours to the American Southwest.
Seattle brokers do a good business by conducting visits to Mexico's Copper Canyon. Some brokers offer music tours, art exhibits, and short trips to New York City for Christmas shopping.
The choice is yours as long as you keep it reasonable. Going to Iraq now may not be the best choice, but there is one company in the United Kingdom offering and operating tours to Iraq – make sure your customers sign up for many disclosures stating that you are not guilty in the event of your death. Given the current state of the economy, it may be prudent to limit your offers to North America, but Costa Rica tours seem to sell very well.
To learn more about this exciting business, click here.