Travel Agency and Tour Operator Operations
Agency versus operator
A travel agency is a retailer and agent: it sells tickets, reservations and packages for principals, earns commission and usually does not carry risk. A tour operator plans and buys services in bulk, builds a package, sells it at a markup and bears the risk if a service fails.
Functions, documents and codes
Agency functions include ticketing, hotel booking, visa assistance, forex, insurance and MICE. Documents: passport (proof of citizenship), visa (permission to enter), PNR (passenger name record, six characters in most systems), e-ticket number (13 digits), itinerary and insurance. GDS platforms: Amadeus, Sabre, Galileo or Travelport. Bodies: UNWTO, IATA, TAAI, PATA, IATO.
Worked example: pricing two nights for 20 pax
Hotel Rs 2,000 per room per night, twin sharing: Rs 2,000 per person for two nights. Transport Rs 20,000 per vehicle ÷ 20 = Rs 1,000. Meals Rs 500 × 3 days = Rs 1,500. Guide Rs 200. Subtotal Rs 4,700. Markup 15 per cent = Rs 705, giving Rs 5,405. GST at 5 per cent = Rs 270, giving Rs 5,675 per person. Reasoning: the price comes from a cost sheet, and the markup is calculated on cost, not as a margin on selling price.
Traps that cost marks
Writing commission when the operator's earning is a markup. Confusing PNR with ticket number. Saying a visa is issued by the travel agent. Quoting a package without inclusions and exclusions.