How Much Do Home-Based Travel Agents Make?

How much DO home-based travel agents make? Really.

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Let me be the first to reveal the truth: no one really knows. People, generally, are reluctant to talk about how much they make and when they answer surveys they are likely to, shall we say, fudge a bit.

Does anyone remember when Howard Stern announced he was running for governor of New York? Here’s a guy who makes his (considerable) living on the radio, speaking to an audience of millions, talking about the length of his . . . well, you know. But when he discovered that in order to run for governor he would have to make financial disclosures, he withdrew from the race. He was shocked — SHOCKED! — that he would have to reveal such personal information.

In other words, all discussions about income need to be taken with a grain of salt.

But let’s take a stab at it anyway.

How much do home-based travel agents make

Let’s talk about income.

Travel Weekly’s 2014 Travel Industry Survey  collected some data, not on net income, but on the gross bookings of home-based travel agents. How accurate is it? I don’t know, but if you’re morbidly curious, you can follow the link and read about the methodology used. Still, it’s probably about as good as we’re going to get in answer to the question how much to home-based travel agents make.

What I have done is take those gross earning stats and done a little creative math that involves some assumptions. The main one is that as experience grows so does the average commission. I have further assumed that gross booking is a rough indication of experience, which is not always a sure bet. Those who have invested in The Home-Based Travel Agent Success Course should be earning higher than average commissions from the get-go. And yet many travel agents, with years of experience, continue to earn less than they are entitled to. Go figure.

How much do home-based travel agents make? An educated guess

Here is the breakdown from the survey. For each slice of the pie chart TW used, I will use the upper limit as the agent’s actual gross bookings, although of course each slice represents a range of figures. This just makes the math a little easier.

Under $25K – 18% of home-based agents
Assumed commission: 10.5%
Actual income: $2,625

The commission figure is based on the assumption that the agent is funneling all commission income through a host that offers a 70/30 split.

The fact that just 18% of home-based agents fall into this category gives the lie to the slur that home-based agents are only booking their own travel. If that were true, we’d expect to see this slice of the pie to be much larger. Some in this category may be self-bookers. But $25,000 is real money. The agents in this slice must be booking some travel for others.

$50K – 13% of home-based agents
Assumed commission: 10.5%
Actual income: $5,250

We are now in the realm of respectable part-time income. Again I am using the same logic for the commission split, although it could be higher for some agents.

$100K – 15% of home-based agents
Assumed commission: 12%
Actual income: $12,000

Here I have assumed that the agent has been around the block enough times to start booking directly with some suppliers and keeping for herself some of those 10% commissions that otherwise would have to be shared with the host.

Once again, this could be respectable part-time income. Or it could be first-year income for an agent who has his or her sights set higher, but who is still learning the ropes. While $100,000 may seem like a lot of money, remember these are gross bookings, and when an upscale cruise can cost $5,000 per person or more it’s not an unreasonable target.

$250K – 15% of home-based agents
Assumed commission: 12.5%
Actual income: $31,250

I’ll admit that bumping up the assumed commission half a percent here is somewhat arbitrary, but by this stage of a career an agent should be learning how to sell travel insurance for most trips and making commissions on those “little extras” like shore excursions, limo transfers, and post-cruise/post-tour extensions.

$500K – 17% of home-based agents
Assumed commission: 13%
Actual income: $65,000

Now we’re talking serious money, a living wage. Perhaps the agent is now getting an 80/20 split, making the effective commission on 16%, 12.8%. Add to that business booked direct and . . .

$1M – 13% of home-based agents
Assumed commission: 14%
Actual income: $140,000

Time to call the Mercedes dealer! Congratulations.

$2M – 7% of home-based agents
Assumed commission: 14%
Actual income: $280,000

I haven’t raised the assumed commission here because why be greedy? But the fact is that at the volume required to bring in two million in bookings, there are a number of ways to increase your commissions. Going to a 100% split is just one. (And, yes, it can be done.)

successful home-based travel agents

Successful travel agents? Could be. (Source: CNBC)

$3M and more – 2% of home-based agents
Assumed commission: Who knows?
Actual income: Take a guess

We’re in the stratosphere now. Just 2% of home-basers reach this pinnacle. But remember, we’re still talking about home-based travel agents, not some humongous storefront operations. It can be done.

If there are 100,000 home-based agents (no one really knows, despite what people may tell you) then there are 2,000 people out there who were no doubt once where you are today who are making megabucks selling travel. Something to think about.

One thing that strikes me about these statistics, rough though they may be, is the rather even distribution. About the same number of agents are grossing $500K a year as are grossing $25K. Only slightly fewer are making a million. Of course, from there the number of super-earners drops off sharply, but still . . .

So that’s my answer to the question, “How much do home-based travel agents make?” Until a better one comes along, that’s the one I’m sticking to.

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How Much Do Home-Based Travel Agents Make? was last modified: October 20th, 2015 by Kelly Monaghan