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  • Writer's picturePruvo

Retail Travel Agencies: Still Relevant in 2023?


One of my favorite shows of all time, The Americans takes place in the late 70s and early 80s and it´s about a married Russian spy couple who used a retail travel agency as their cover story to justify their luxurious lifestyle. But are retail travel agencies still relevant in 2023 and can they provide an opportunity for a thriving business that you can start? Let´s dive into the world of retail travel agencies to find out.



Retail Travel Agencies: Still Relevant in 2023?


What are retail travel agencies?


Retail travel agencies are companies that cater to individuals seeking travel opportunities by offering a range of services at their chosen destinations. These agencies serve as intermediaries, connecting tourists with various vacation packages and experiences curated by wholesale resellers. It's important to note that retail agencies exclusively provide services directly to customers and do not extend their offerings to other agencies.


The primary responsibility of these companies is to fulfill their clients' travel aspirations while considering their budgetary constraints. They accomplish this by offering pre-designed tour packages sourced from wholesale companies, or by crafting bespoke packages by combining different services available in the industry. Retail travel agencies take on the crucial role of preparing, organizing, and selling these services to tourists, ensuring that the trip is customized to their preferences and desires.


Difference between retail travel agencies and other travel agencies


Retail travel agencies play a crucial role in selecting travel packages that can be tailored to their target market. They then recommend and sell these services and package tours directly to travelers. As intermediaries, they must effectively address the needs and preferences of their end customers.


Wholesalers and bedbanks, on the other hand, take on the responsibility of negotiating with hotels and airlines directly and creating vacation packages. They establish connections with hotels, airlines, and tour guides to assemble a comprehensive range of services. Additionally, wholesalers maintain relationships with retail companies that will ultimately offer these services to the end users.


In certain cases, retail travel agencies may collaborate with other agencies to form travel agency management groups. These groups function as unified entities, leveraging enhanced coordination and increased bargaining power with suppliers. By joining forces, they gain a competitive advantage in the industry.



Different types of retail travel agencies


There are various types of retail travel agencies that exist within the tourism industry, each with its own distinctive characteristics and focus. Here are some examples:


1. Outbound Travel Agencies:

These agencies specialize in offering pre-designed trips created by wholesalers, tailored to meet the specific needs and preferences of individuals who wish to travel to destinations outside their hometowns.


2. Inbound Travel Agencies:

In contrast to outbound agencies, inbound travel agencies play a vital role in receiving and assisting visitors in the specific locations where they are situated. They provide a range of services to ensure a smooth and enjoyable experience for travelers.


3. Online Travel Agencies (OTAs):

Also referred to as OTAs, these agencies primarily operate through online platforms. Unlike traditional agencies, they often lack a physical presence and mainly offer services digitally, without providing extensive advisory support to their customers.


4. Niche Travel Agencies:

Niche agencies focus on catering to specific niche markets within the travel industry. They offer tailored travel services and experiences in niche areas such as eco-friendly, extreme sports, live events (concerts, sports), group travel, and more. Their expertise lies in providing specialized guidance and curated experiences for travelers with specific interests or needs.


Each type of retail travel agency caters to different segments of the market and provides unique services to fulfill the diverse preferences and requirements of travelers.



Where is the opportunity today for retail travel agencies?


If you are someone who has the industry knowledge, I would focus on combining your specific domain expertise within the travel industry with finding an underserved market. The key here is that you should have knowledge both on the sourcing side of this specific travel product along with an “unfair advantage” on the distribution of this product to your specific audience. Look for a niche that is small enough that bigger players won´t waste their time on, but big enough that you can continue to grow for years to come.


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