Independent Travel Agent Fee Report, 2021

Our 2021 independent travel agent report takes a deep dive into fee-charging practices for travel advisors who have their own accreditation. (If you’re looking for info on hosted agents, look here.) Within the independent advisor segment, there is a significant range in how these advisors operate their business.

In this report, we’ll look at how many independent advisors charged fees, what types of fees they charged, and how business operations (such as hours worked, niche, and products sold) impact their likelihood to charge.

Fee Summary: Takeaways of Independent Advisor Fees in 2020

Let’s cut to the chase: 56% of independent advisors reported charging fees and 44% charged no fees¹. Here’s the full breakdown:

This is a 19-point drop from last year when 75% of independent advisors charged fees. Why is this?

In part, more advisors reported they didn’t charge fees due to a precipitous drop in bookings at COVID’s onset (the timeframe which the survey reviewed).

However, this decline was offset by a much higher motivation to begin charging fees.

In our 2021 survey, 37% of independent non-chargers reported they’d implement a fee in the next 12 months. This is a drastic 29-point increase from our 2020 survey when only 8% of non-charged reported they’d charge a fee in the future.

Among those who did charge fees, median air ticketing fees typically increased.

What this tells us is that the pandemic may have played a role in motivating non-chargers to stabilize their income with fees. Additionally, it’s possible that some advisors had charged a fee in the past, but didn’t consider themselves to be fee-chargers during a time when they made no booking.²

However, among those who did charge fees, median air ticketing fees typically increased. The few exceptions were international air (which stayed level) and special coupons (which slightly decreased).

Below we’ll take a deep dive into the fee practices that sparked these latest trends. Here’s what to expect:

⭐️ HAR ARTICLE HIGHLIGHTS: ⭐️

1. Infographic Overview: Independent Travel Agent Fees
2. How Many Independent Agents Charged Fees?
3. What Service Fees did Independent Agents Charge (and How Much?)
4. What Consultation Fees did Independent Agents Charge (and How Much?)
5. Agency Operations and How it Impacted Fees
6. Experience and Likelihood to Charge Fees
7. Why Independent Agents Charged Fees
8. Independent Agents Who Did Not Charge Fees
9. HAR Industry Supporter Shoutout
10. A Glossary of Terms

Infographic Overview: Independent Travel Agent Fees

Below is an infographic overview of the data we’ll explore today.

As you notice in our infographic, we’re about to throw around words like median, mode, and interquartile range (the scariest one, in my opinion).

I understand you probably didn’t get into the travel industry because of your love for statistics, or for an added edge in your Scrabble game. But don’t worry, all you need to do is click on the word and you’ll be taken to a short lay-person-friendly definition. You can try it right here! Interquartile range.

Okay, back to our regular programming. Great data! But don’t jump ship, because we have a lot more info to come.

How Many Independent Agents Charged Fees?

Let’s cut to the chase: 56% of independent advisors reported charging fees and 44% charged no fee³. Here’s the full breakdown:

This is a 15-point drop from last year when 75% of independent advisors charged fees. Why is this?

In part, more advisors reported they didn’t charge fees due to a precipitous drop in bookings at COVID’s onset (the timeframe which the survey reviewed).

However, this decline was offset by a much higher motivation to begin charging fees.

In our 2021 survey, 37% of independent non-chargers reported they’d implement a fee in the next 12 months. This is a drastic 29-point increase from our 2020 survey when only 8% of non-charged reported they’d charge a fee in the future.

Among those who did charge fees, median air ticketing fees typically increased.

What this tells us is that the pandemic may have played a role in motivating non-chargers to stabilize their income with fees. Additionally, it’s possible that some advisors had charged a fee in the past, but didn’t consider themselves to be fee-chargers during a time when they made no booking.⁴

However, among those who did charge fees, median air ticketing fees typically increased. The few exceptions were international air (which stayed level) and special coupons (which slightly decreased).

Below we’ll take a deep dive into the fee-practices that sparked these latest trends. Here’s what to expect:

What Service Fees did Independent Agents Charge (and How Much?)

49% of all independent advisors reported charging a service fee in HAR’s latest survey. In our survey, we group our questions about service fees into two categories: air-ticketing fees, and non-air ticketing fees.

Below is a closer look at fee trends for these two categories.

1. AIRLINE TICKETING FEES

Air ticketing is a lower to no commission product for most advisors, so it’s no surprise that ticketing fees have registered as the most common service charge among independent advisors year over year.

The graph below indicates what air ticketing services independent advisors charged in 2020. Additionally, it also includes the median charge as well as the interquartile range.

Median charges varied slightly depending on ticketing service. Since domestic and international air were the most common service fees, HAR considers air ticketing the “commodity” item of fees, similar to how people may use the price of milk as a reflection of the overall cost of groceries.

Most air ticketing charges increased in 2020 among independent advisors. The exception to this was international air (which stayed level) and special coupons (which decreased slightly). You can see how the needle has moved for different air ticketing fees below:

2. NON-AIR TICKETING FEES

The top three most common non-air fees were FITs, tours packages, and air-inclusive packages also registered the highest median per booking fees at $150.

While air-ticketing was the most common service fee charge among independent advisors, advisors also charged for other services. The top three most common non-air fees were FITs (59%), tours packages (39%), and Air-inclusive packages (36%). These three products also registered the highest median per booking fees, $150.

In our survey, we asked respondents whether they charged per booking fees or per person fees. Independent advisors favored per booking fees over per person fees for the majority of non-air services. The exceptions to this were air-inclusive packages and shore excursions, categories where advisors favored per person fees, and shore excursions, where advisors were equally likely to charge a per person or per booking fee.

The table below ranks which non-air ticketing fees indpendent advisors were most likely to charge, including the per booking and per person medians:

While independent advisors reported more variable medians than their hosted peers, the most common median fee for non-air services (per person or per booking) was $50.

What Consultation Fees did Independent Agents Charge (and How Much?)

Overall, 31% of independent advisors charged a consultation fee, a significant 15-point drop from 2019 when 44% of independent advisors reported charging a consultation fee.

31% of independent advisors charged a consultation fee.

Among those who charged consultation fees, the overwhelming majority, 79%, opted for a flat fee. Here’s the full breakdown below:

Here’s a few additional takeaways on independent advisors’ consultation fee trends:

​​1. Flat Fees:

Advisors typically approach flat fees in two different ways.

1. Fixed Rate: When an advisor charges the same flat fee regardless of the type of trip they’re planning, it’s considered a fixed flat rate.
2. Variable Rates: Some advisors will charge a higher flat fee depending on the complexity of the trip. A great example of a variable rate is from the agency Italy Beyond the Obvious, which charges a daily flat fee $225 or $350+, depending on the level of planning services and support provided.

A flat fee was the most common fee structure for independent advisors. The median fixed rate for flat fees was $150 in 2020, a drop from 2019 when the median was $200. However, more independent advisors reported charging a variable rate, 58%, compared to the 42% with a fixed rate.

The variable rate of flat fees increased in 2020, $100-$500 compared to $88-$350 in 2019.

However, the variable rate of median flat fees increased in range. In 2020, variable flat fees ranged between $100-$500, higher than in 2019 when the range started lower and was narrow, $88-$350. ⁵

The overwhelming majority of independent advisors—98%—charged a one-time flat fee opposed to a daily flat fee. A slimmer majority of independent advisors charged a variable rate, 58%, compared to the 42% with a fixed rate.

2. Per Person Fees & Hourly Fees

Few independent advisors charged per person fees and hourly fees (13% and 8% respectively). We didn’t receive a strong enough sample size for this fee-charging segment to offer reliable median fixed rates or variable rates.

The majority of advisors who charged these types of fees reported having ICs and/or employees (75%) and worked full time before COVID (81%).

While they ran the gamut in agency operations from niche, experience, and products sold, there were a few unifying traits. The majority of advisors who charged these types of fees reported having ICs and/or employees (75%) and working full time before COVID (81%).

3. Plan-to-Go Fees

Last year, HAR added a “plan-to-go” fee option to our survey in addition to our usual suspects listed above.

In 2020, only 6% of independent advisors overall charged a plan-to-go fee.

Plan-to-go fees are like the “car diagnostics” of the travel world. You may have to pay a mechanic for a diagnostic if you decide not to get your car fixed at their shop (or try to fix it on your own). But if you do get it fixed, the diagnostic is waived.

A plan-to-go fee is an upfront payment or deposit advisors receive from clients in order to start planning their trip. The plan-to-go fee—in full or in part—is then applied to the booking if the traveler decides to book through the agent.

In 2020, only 6% of independent advisors overall charged a plan-to-go fee. (This is much lower compared to the hosted advisor segment, where 25% reported charging plan-to-go fees.) When looking at this small segment:

Agency Operations and How it Impacted Fees

Here are some big-picture data on the business models of independent agents, how many hours they work, and how these factors impacted their likelihood to charge fees:

1. HOME-BASED VS STOREFRONT:

75% of independent advisors operated home-based agencies and 25% were storefronts.

Agency location had a large impact on the tendency to charge fees. Home-based advisors were less likely to charge fees, 45% compared to the 68% of storefront advisors who charged.

The 18-point gap between home-based and storefront agents has narrowed from 2019 when a 21-point gap separated these two segments.

2. CORPORATE VS LEISURE:

Travel products sold impacted the likelihood to charge fees. Advisors who sold corporate travel were more likely to charge service fees. Below the graph indicates the percentage of corporate advisors that sold leisure, corporate, or both as well as what percentage charged service fees.

While very few independent advisors booked corporate travel only, 100% of this small segment charged fees. 75% of independent advisors who sold both corporate and leisure charged fees, and those who sold leisure travel only were least likely to charge service fees.

3. FULL-TIME VS. PART-TIME HOURS:

“Independent advisors who charged fees were more likely to maintain full-time hours after the pandemic outbreak.”

Typically, full-time advisors are much more likely to charge fees, and this year was no different. Before the COVID outbreak, 57% of full-time advisors charged fees compared to 31% of part-time advisors.

The majority of independent advisors reduced hours during the pandemic regardless of whether or not they charged fees. However, most independent advisors who worked full time during the pandemic charged fees (72%), and only 44% of part-time agents did.

4. FEE PRACTICES ACCORDING TO NICHE:

The graph below indicates which niches were most common among independent advisors:

A niche’s popularity didn’t correlate with the likelihood to charge. Below we ranked the top three niches most likely to charge fees⁶

1. Luxury: 75%
2. Weddings/ Honeymoons: 74%
3. Destination Specialist: 59%

The graph below illustrates each niche category along with the likelihood of the segment to charge a fee.

Experience and Likelihood to Charge Fees

Independent advisors reported a median of 15 years of experience.

Only 7% of new advisors who responded to our survey were independently accredited.⁷ This new-to-industry segment was least likely to charge, with 36% reporting they charged fees. Below illustrates the likelihood to charge fees by years of experience.

Why Independent Agents Charged Fees

To better understand advisors’ motivations for charging fees, we asked why travel agents charged fees.

Here’s the top 3 reasons independent agents charged fees:

1. My time and expertise is worth it 48%
2. Weed out 'tire kickers', 27%
3. To stabilize my income, 15%

These results also mirror the motivations of hosted advisors as well. Below you can see all the responses tallied:

If you’re curious to dig into why you might consider charging fees, we have a ton of resources for you:

Independent Agents Who Did Not Charge Fees

44% of independent advisors did not charge fees in 2020. In this section, we look at this segment to examine their hesitations to charge fees and their motivation to implement one in the future.

Below is a ranked list of reasons why independent advisors did not charge fees in 2020.

Client attraction and retention was the primary reason that independent agents didn’t charge fees (which were also the top two reasons last year).

DO INDEPENDENT TRAVEL ADVISORS PLAN TO CHARGE FEES?

When asked if non-charging independent advisors planned to implement fees, 28% replied “no,” 37% replied “yes,” and 35% replied “not sure.”

The volume of independent advisors who plan to charge in the future increased significantly from a mere 8% in 2019, to 37% in 2020.

HAR Industry Supporter Shoutout

A colossal thank you to these partner travel organizations: American Society of Travel Advisors, Association of Black Travel Professionals, CCRA, Destination Wedding Honeymoon Specialist Association, Ensemble Travel Group, Gifted Travel Network, Nexion Travel Group, Outside Agents, Royal Caribbean Cruise Line, Travel Quest Network, Travel Leaders Network, Travel Pulse, and Travel Research Online.

A Glossary of Terms

1. Interquartile Range (IQ): A typical "range" shows us the lowest and highest fee. But the interquartile range helps us remove outliers in order to get a clearer picture of moderate fee-charging practices. This isn’t to discount your fee strategy if you charge $1,000 for fee for international air, or if you only charge $2 to grandma Matilda because she pays you (literally) in dimes. It’s just to help give a clearer picture of what the “average” advisor is charging. For those really nerding out, the Interquartile Range measures the range between the 25th and 75th% percentile. This means the range excludes the data from the lowest 25% and the highest 25%, eliminating the lower and upper outliers and offering a picture of more moderate fee-charging practices.
2. Median: The median is the middle value in the set of numbers. (That’s right, the middle child of data!) We used the median value to determine age and years of experience. This helped us get a clearer picture of the “average” agent, by eliminating outliers that skew the data.
3. Median Range: When we offer a median range the numbers reflect the spread between the middle value of the lowest fee entries and the middle value of the highest fee reported by our respondents in our survey.

Footnotes

1. 8% of independent advisors were non-sellers. This data only profiles independent advisors that sold travel in 2020. ↩
2. This is data-driven speculation about respondents' attitudes toward taking the survey. We did not ask respondents if they had charged a fee in the past. ↩
3. It's important to note that 8% of independent advisors were non-sellers. These independent advisors were not included in this data. ↩
4. This is data-driven assessment about respondents' attitudes toward taking the survey. We did not ask respondents if they had charged a fee in the past. ↩
5. The range depicted here is a median range. Respondents had an opportunity to input an amount for the lowest charge and highest charge. The median low is the median of all “low responses” and the median high is the median of all “high responses.” For categories, ”Hourly Fee” and “Per Person Fee,” we did not have enough data to provide a median fee and/or a median low and median high range ↩
6. Here we only included niches with response rates high enough to offer reliable data. River Cruises, Disney, Other, Corporate, Adventure Travel, Accessible Travel, Heritage Travel, LGBTQ+, MICE, and Wellness Travel did not reach the threshold. ↩
7. We consider “new advisors” those with 0-2 years experience ↩