CHAPTER - II
FUNCTIONS OF TRAVEL AGENCY
As I have already mentioned, a travel agency is a retail business, that sells travel related
products and services to customers, on behalf of suppliers, such as airlines, car rentals, cruise
lines, hotels, railways, sightseeing tours and package holidays that combine several products. In
addition to dealing with ordinary tourists, most travel agencies have a separate department
devoted to making travel arrangements for business travelers and some travel agencies specialize
in commercial and business travel only.
There are also travel agencies that serve as general sales agents for foreign travel
companies, allowing them to have offices in countries other than where their headquarters are
located. As the name implies, a travel agency's main function is to act as an agent, i.e., to sell
travel products and services on behalf of a supplier. Consequently, unlike other retail businesses,
they do not keep a stock in hand. A package holiday or a ticket is not purchased from a supplier
unless a customer requests that purchase. The holiday or ticket is supplied to them at a discount.
The profit is therefore the difference between the advertised price which the customer pays and
the discounted price at which it is supplied to the agent. This is known as the commission.
A British travel agent would consider a 10-12% commission as a good agreement. In some
countries, airlines have stopped giving commission to travel agencies which made the travel
agencies to charge a percentage premium or a standard flat fee, per sale. However, some
companies still give them a fixed percentage for selling their product.
Major tour companies can afford to do this; because if they were to sell a thousand trips at
a cheaper rate, they still come out better than if they sell a hundred trips at a higher rate. This
process benefits both parties. Other commercial operations are undertaken, especially by the
larger chains. These can include the sale of in-house insurance, travel guide books and
timetables, car rentals, and the services of an on-site Bureau de change, dealing in the most
popular holiday currencies. The majority of travel agents have felt the need to protect
themselves and their clients against the possibilities of commercial failure, either of their own
or a supplier's.
They will advertise the fact that they are surety bonded, meaning in the case of a failure, the
customers is guaranteed either an equivalent holiday to that which they have lost or if they prefer
a refund. Many British and American agencies and tour operators are bonded with the
International Air Transport Association (IATA), for those who issue air tickets, Air Travel
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Organizers’ Licensing (ATOL) for those who order tickets in, the Association of British Travel
Agents (ABTA) or the American
Society of Travel Agents (ASTA), for those who sell package holidays on behalf of a tour
company. A travel agent is supposed to offer impartial travel advice to the customer. However,
this function almost disappeared with the mass-market package holiday and some agency chains
seemed to develop a 'holiday supermarket' concept, in which customers choose their holiday
from brochures on racks and then book it from a counter. Again, a variety of social and economic
changes have now contrived to bring this aspect to the fore once more, particularly with the
advent of multiple, no-frills, low-cost airlines.
MAJOR FUNCTIONS OF A TRAVEL AGENCY
The scope and range of travel agency operations would depend on the size of an agency. If
the company is large in size, the range of activities will be more comprehensive. In this case the
agency will have specialized departments, each having to perform different functions. To deal
with the subject of a travel agency, the best method of approach is, perhaps, to consider the
functions of a travel agency. These may be broadly classified as follows: Provision of Travel
Information. One of the primary functions of a retail travel agent from the point of view of the
tourists or the general public is to provide necessary information about travel.
This information is provided at a convenient location where the intending tourists may
ask certain questions and seek clarifications about their proposed travel. This is a much-
specialized job and the person behind the counter Its should be a specialist with excellent
knowledge of various alternate travel plans.
He should be in a position to give up-to-date and accurate information regarding various
services and general information about travel, etc.
Preparation of Itineraries
Tourist’s itineraries are a composition of a series of operations that are a result of the
study of the market. A tourist journey is characterized by an itinerary using various means of
transport to link one locality with another. Preparation of different types of itineraries is another
important function of a travel agency.
A travel agent gives advice to intending travelers on the type of programmes which
they may choose for their holidays or business travel. The study and the realization of their
itineraries call for a perfect organisation (technical and administrative) as also knowledge of the
desires of the public for a holiday and the propensity to receive tourists by the receiving
localities.
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Travel Facilitation
Tourists need information about what is available at the destination in order to get the
most from the leisure holiday or a business trip. The travel agents who handle tourists for
various destinations must have complete travel information to facilitate their clients to visit a
particular country. The information to be provided does not relate only to travel but on variety
of topics like local transport, sites and destinations, fairs and festivals, cultural aspects of the
country, accommodation available, medical facilities, entertainment, eating places, etc.
A tourist seeking the help of a travel agent for planning his trip to a particular
destination would require information on the following areas:
i. Mode of travel to the destination
ii. Travel within the destination
iii. Travel advisories, like visa regulations and health precautions
iv. Custom formalities
v. Currency and exchange
vi. Departure formalities
Once, the contracts and arrangements having been entered into, the next task is of
planning and costing tours, both for inclusive programmes and to meet individual requirements.
This job calls for a great deal of initiative and drive. The job calls for travel to those places
which are to be included in the itineraries. This is essentially a job for a meticulously minded
person and calls for considerable training and ability. Many agencies with the cooperation of
airlines and other transportation companies take the opportunity of arranging educational tours
for such staff to countries with which they deal.
Many agencies have people who are authorities on particular countries and, in
addition to a general programme, many will issue separate programmes dealing with territories.
Separate programmes dealing with holiday offers based on specific forms of transportation,
e.g., air, rail, road or sea, may also be prepared. Programmes also have to be issued to cover
different seasons of the year. Publicity is an important part of the programme. Having spent
considerable time and money on preparing all that goes into the issue of a programme, publicity
must feature considerably in the activities of a travel agency and more so if the agency happens
to be a large one. The majority of large travel agencies have their own publicity departments
under the management of a publicity expert.
Ticketing
Selling tickets to clients using different modes of transport like air, rail and sea is yet
another important function of a travel agency. This calls for a thorough knowledge of schedules
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of various modes of transport. Air carriers, railways and steamship companies have hundreds of
schedules and the person behind the counter should be conversant with all these. Ticketing is
however, not an easy job as the range and diversity of international airfares is very complex and
varied. Change in international, as also in the local air schedules and additions of new fights
from time to time, makes the job of the travel agent a constant challenge. An up-to-date
knowledge about various schedules of air companies, steamship companies and railways is
very essential.
Accommodation
Wide range of accommodation in the form of hotels and also supplementary
accommodation catering to every budget and preference must be available with the travel
agency. Information about the major private sector hotel chains with centralized reservation
system offering a variety of options must be readily available with them. Information about the
public sector hotels, range of services, location and prices should be available with the travel
agents.
Communication
Every tourist visiting a country, away from home would like to be in touch with
people back home. In this world of Information Technology, a tourist would definitely like to
know the procedures and modes of communication from the destination to his home country.
Mention must be made of the government run Cottage Industries Emporium, State Cottage
Industries Emporium located in the metros and two-tier cities and towns.
Liaison with Providers of Services
Before any form of travel can be sold over the counter to a customer, contracts have to
be entered into with the providers of various services. These include transportation companies,
hotel proprietors
The providers of surface transport like motor cars or coaches for transfer to and from hotels
and for sightseeing, etc., and also for general servicing requirements. In the case of a large
agency with worldwide branches, the liaison work involves a great deal of coordination with
the principals.
Insurance. Insurance for personal accident risks and risk for loss of baggage is an important
function of a travel agent.
ADDITIONAL FUNCTIONS OF A TRAVEL AGENCY
The following are some of the additional functions of travel agency. They are;
Facilitating inbound Tourism
Most of the travel companies are in private sectors and their main objectives is to earn
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profit; in spite of this they play a key role in the promotion and development of international
tourism. They receive guests, foreign tourists and handle arrangements in the host country.
In India about 50 percent the established travel companies handle foreign tourists and other
visitors make their own independent arrangements.
Facilitating outbound Tourism
These agencies promote tours to foreign destinations. Since, the deregulations of air
industry the outbound tourism has been increasing rapidly. Today outbound tourist traffic is
growing thing at rate of 10 percent. This indicates that India is the second largest county in
outbound tourism.
The major outbound destinations are Europe, UK, Southeast Asia, Greece, and East Asia,
USA, Egypt and Australia. The fun tours of TCI are the Evidence of quality inclusive
outbound package that generally include deluxe class accommodation Indian meals
transportation by deluxe couches Experienced tour escort sightseeing and interaction with
local culture. This will create sound international relationship between the developing agencies
and build better relation abroad.
Facilitating Domestic Tourism
Domestic tour operators assemble and combine tourist components into inclusive tours
and sell them to the domestic travelers. The Indian Travel Companion has offered and
continues to formulate flexible and economical packages to popular holiday destinations like
Golden Triangle, Goa, Shimala, Kulu-Manali, Derjaling, Bangalore, Hydrabad, Mysore, Ooty,
J&K, Lakshadweep and many more destinations. In fact they are contributing to the causes of
national instigation.
ECONOMIC FUNCTIONS OF TRAVEL AGENCIES:
Apart from the main functions and additional functions, travel agencies and tour
operators also have functions such as provision of foreign currencies, earning of foreign
currency, employment generation.
Provision of Foreign Currencies
Providing foreign currencies to intending travelers is another specialized activity of
a travel agency. Some of the larger travel agencies deal exclusively in the provision of
foreign currencies, traveler's cheques, etc. This is an important facility for intending
travelers as it save them a lot of time and energy in avoiding visits to regular banking
channels.
Earning of Foreign Currency
The foreign exchange brought to India by the travel companies is a vital
contribution toward the national economy. It is a major factor on India Balance of payment
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position. Therefore, the government has taken various steps either through collaboration or
through their own tourist offices abroad, to maximize the tourist receipts.
Employment Generation
No other sector of Indian economy has generated huge employment opportunities
like the travel and tourism industry. The travel industry employees over 25000 people directly
and thousands of indirectly in India. The World Travel and Tourism Council (WTTC)
forecasts that during the next decade more than 10 million jobs will be created by travel and
tourism industry along across.
DESTINATION PROMOTION DEVELOPMENT AS A FUNCTION OF
TRAVEL AGENCY
Today many travel companies with the collaboration of state tourism corporations and
tourism departments are contributing in promoting and development new destinations even
the government has also provided various financial incentives to the private sector to promote
tourism in the country. The role and contribution of travel companies have been fully
appreciated in advanced countries. But in countries like India the role and contribution has not
been appreciated and recognized due to the unorganized sector. Still the travel companies
have the greatest impact on account of balance of payment, employment, international
understanding and national integration.
Travel agents help travelers sort through vast amounts of information to help them make
the best possible travel arrangements. They offer advice on destinations and make arrangements
for transportation, hotel accommodations, car rentals, and tours for their clients. They are also
the primary source of bookings for most of the major cruise lines.
In addition, resorts and specialty travel groups use travel agents to promote travel
packages to their clients. Travel agents are also increasingly expected to know about and be
able to advise travelers about their destinations, such as the weather conditions, local
ordinances and customs, attractions, and exhibitions. For those traveling internationally,
agents also provide information on customs regulations, required papers (passports, visas, and
certificates of vaccination), travel advisories , and currency exchange rates. In the event of
changes in itinerary in the middle of a trip, travel agents mediate on the traveler’s behalf to
make alternate booking arrangements.
Travel agents use a variety of published and computer-based sources for information
on departure and arrival times, fares, quality of hotel accommodations, and group discounts.
They may also visit hotels, resorts, and restaurants themselves to evaluate the comfort,
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cleanliness, and the quality of specific hotels and restaurants so that they can base
recommendations on their own experiences or those of colleagues or clients.
Travel agents who primarily work for tour operators and other travel arrangers may help
develop, arrange, and sell the company’s own package tours and travel services. They may
promote these services, using telemarketing, direct mail, and the Internet. They make
presentations to social and special- interest groups, arrange advertising displays, and suggest
Apart from the primary functions, a travel agency also involves in activities such as promoting
inbound tourism and domestic tourism and facilitating outbound tourism. The economic
functions of a travel agency include provision of foreign currencies, earning of foreign
currencies and generation of employment.
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