What could be more exciting than accompanying travelers to their dream ?
In a world in which travelers seek tailor-made experiences, the travel sector offers fertile ground for enterprising spirits, but opening a travel agency isn't just about booking plane tickets and hotels!
So what are the main steps involved in opening a functional travel agency?
What is a travel agency? 🧐
Simply put, it's the company that builds and sells services to customers, with precise regulations detailed here or again here. Its mission is therefore to facilitate and even organize travel for its customers, from the flight to the various accommodations, not forgetting the activities.
It can offer different types of services, such as tourist packages, related travel services, or even complete travel services, and vary according to its typology. Indeed, there are not only traditional agencies that sell their services to families (B2C), but many other forms:
FIT Travel Agencies: They operate for independent travelers, specializing in one or more particular geographical locations. They generally personalize trips, favoring an individualistic and unique approach for each customer. For example, Nos Chères Campagnes is a FIT specializing in local tourism.
Tour Operator: Large, they create turnkey trips for groups of travelers. These trips are not customized. For example, Evasions USA is a Tour Operator specializing in bus tours.
Business travel and incentive agency: also known as MICE (Meetings, Incentives, Conferences and Exhibitions), their role is to organize and sell business trips, as well as programs for corporate meetings, reward trips, trade fairs, and exhibitions. For example, Active Road is a MICE agency specializing in authentic outings, leisure activities, and stays.
They can subsequently adopt different forms, being receptive - welcoming travelers - or emissive - organizing travelers' departure. In recent years, more and more have also chosen to adopt a digital format, having no physical presence, but rather on the Web, as Continents Insolites, for example, does. This type of agency is also known as an OTA (Online Travel Agency).
What are the steps involved in opening a branch? 🛫
Opening such a business can seem like a complex process... With the step-by-step guide below, everything will be much easier!
Conducting market research 📊
Before rushing in and opening the organization without preparation, you need to carry out a market study: the very first thing to check is whether there is a need, and a few questions to ask yourself:
- What problems would be solved?
- Who would be the target clientele (professionals, businesses, foreign tourists, etc.)?
- What would the proposed services look like?
Next, you'll need to observe market trends from two different points of view.
The macro point of view will provide more information about the economic and sociological situation of the country and its population, as well as the various regulations in place within the tourism sector. This will provide answers to questions such as the main trends and habits of travel consumption, the best times to sell trips, and what is needed to ensure that the agency complies with the law (indications will be given below).
The micro point of view, for its part, will provide information on potential competitors, the ideal location for setting up the business, and market saturation in specific places. For example, it is preferable to open this type of business in a region/city/neighborhood where few are present, but where a potential clientele exists, ready to consume organized travel services.
Building a business model ✍️
It will be hard to keep the agency open without earnings! A business model illustrates exactly how the agency will :
- Create value
- Deliver value
- Capture value
To do this, just three words are worth remembering.
Mission: The agency's mission will make it possible to spell out precisely what the organization will be needed for, as well as the value it will bring to the market and to travelers.
Vision : The agency's vision allows us to project the agency into the future, and to think about the value it will create in the long term.
Strategy: The agency's strategy is, very concretely, the financial or non-financial means that will be put in place to successfully achieve the agency's mission and vision
These 3 expressions are essential, being the cornerstone of the company. It's by clearly defining the company's mission, vision, and strategy that it can subsequently open, and then prosper.
To facilitate thinking, the "Business Model Canvas" is often used, and is even recommended. Ezus has created one just for you!
Bringing together guarantee and financial contributions 💵
Financial contributions are the funds needed to open the travel agency, providing a source of financing for the various costs involved.
According to the Observatoire de la Franchise, the average investment required is €40,000. This may be personal, but may also come from participatory financing, a bank, public investors, or various public grants, such as France Travail's "Aide à la reprise", or the "Nouvel Accompagnement à la Création ou à la Reprise d'Entreprise", for example.
In France, it is impossible to open a travel agency without a Garantie Financière Tourisme. This is necessary to ensure the repatriation of travelers in the event of bankruptcy.
To subscribe to a financial guarantee, the future travel agent must contact one of the following:
- A collective guarantee organization;
- An insurance company headquartered in a member state of the European Union, is able to provide this type of service;
- Non-profit associations with ministerial authorization to provide the service;
- A credit institution
The amount of the financial guarantee will be determined by the establishment providing the service, based on forecast sales.
What's more, you'll need to take out professional liability insurance, a real safety net in the event of a refund from the same organizations. The Atout France website provides all the necessary information on this subject.
Choosing the right legal status 📚
This choice is the very first concrete step in opening an agency, and determines the form of the business in the eyes of French company law.
The list of available statuses is inordinately long, so Ezus has selected the 4 main ones:
SARL : The limited liability company is the first choice. It is reassuring, as only the amount of the capital can be claimed in the event of bankruptcy, and the partners cannot be held liable (except in the case of serious misconduct). It is important to note, however, that this business structure can only exist if there are at least two partners, whose contributions make up the share capital, and that an SARL requires an annual general meeting.
EURL : The "entreprise unipersonnelle à responsabilité limitée" adopts the same form as the SARL, the only difference being that there are no partners, but a single shareholder. This legal form is practical in terms of management, and always offers the possibility of a transition to a SARL.
SAS : The simplified joint-stock company (société par actions simplifiée) is suited to larger-scale businesses, requiring the involvement of several partners. With liability limited to contributions and clear management, the SAS is favored by those aiming for rapid growth and shared governance, and can accommodate an unlimited number of partners, which attracts investors.
SASU : The "société par actions simplifiée unipersonnelle" is the equivalent of a SAS with a single shareholder; offering great flexibility in management, the transformation into a SAS is facilitated when new associates join the company, making the SASU adaptable to changes in the company and suitable for growth projects.
Setting up the travel agency's share capital ⚖️
Share capital represents the company's own resources, intended to finance the start-up of the business. Depending on the legal form adopted by the company, different incorporation options are available.
In a SAS or SASU, capital is formed by shareholders' contributions. These may take the form of cash, in-kind, or industrial contributions, even if these industrial contributions are not included in the share capital, but confer rights to shares.
For cash contributions, a bank account must be opened in the company's name, into which the funds can be deposited. It is imperative that at least half of these contributions be paid up when the company is created, and that the balance be paid within a maximum of five years. In the case of contributions in kind, it is necessary to call on the services of a contribution auditor to determine their exact value before incorporating them into the share capital.
It is crucial to give careful thought to the amount of share capital, ensuring that it is adequate to meet initial needs without being exorbitant for the partners. A substantial initial capital can also serve as a guarantee of solvency with the travel agency's creditors and financial partners. It should be noted, however, that the amount of share capital can be readjusted at a later date at the initiative of the shareholders, depending on the company's expansion or restructuring needs.
Choose your premises 🏙️
In the case of a physical, "traditional" travel agency, you'll need to acquire or rent premises that suit your budget, but also the strategic location you need to attract as many travelers as possible. For example, it may be a good idea to set up close to train stations or airports, or even the busiest places in the chosen city, such as a shopping area.
It will be important to find premises with a surface area suited to the company's needs: neither too large, to avoid unnecessary costs, nor too small, to provide a pleasant customer experience and a functional work area for the teams, and to ensure future prospects with room for possible growth.
Taking care of administrative formalities 🗓️
Then comes the most complex part of the process: the many administrative formalities.
Drafting the articles of incorporation is a crucial step in the process of creating a company. They form the legal foundation of the company and define the rules by which it will operate. Here are the steps and elements to consider when drawing up the articles of association:
Drafting mandatory clauses
The articles of association must include several mandatory clauses:
- Corporate name: the name of the company.
- Registered office: the address where the company will be registered.
- Corporate purpose: the activities in which the company may engage.
- Duration: the lifespan of the company, often set at 99 years by default.
- Share Capital: the amount of contributions made by associates or shareholders.
- Distribution of shares: how the capital is divided.
- Contributions: nature of contributions (cash, in-kind, industrial), valuation of in-kind contributions, terms and conditions for paying up cash contributions.
- Legal form: the chosen structure (SAS, SASU, SARL, etc.).
- Operating procedures for management bodies: appointment of directors, powers, meetings, decisions, etc.
- Rules governing shareholders' meetings: conditions for convening meetings, quorum, majority, etc.
Drafting specific clauses
Depending on the specifics of the company and the wishes of the partners, it is possible to add specific clauses such as :
- Approval clauses: conditions under which shares may be transferred to third parties.
- Pre-emption clauses: the right of certain associates to purchase shares offered for sale on a priority basis.
- Clauses relating to the death of a partner: terms and conditions governing the transfer of shares in the event of death.
- Non-competition clauses: prohibiting associates from engaging in certain competing activities.
Once the articles of association have been drawn up, it is necessary to:
- Signing: all partners or shareholders must sign the articles of association.
- Register them: depending on the circumstances, it may be necessary to register the articles of association with the tax authorities.
- Publish them: a notice of incorporation must be published in a legal gazette.
- Submit them: the signed articles of association and supporting documents must be submitted to the commercial court clerk's office for registration of the company.
Additional tips
- Get support: to avoid mistakes, it's advisable to be accompanied by a legal professional (lawyer, notary, chartered accountant).
- Provideflexibility: the articles of association must be sufficiently detailed to prevent conflicts, but also flexible enough to allow the company to evolve.
- Protect interests: it is necessary to ensure that the articles of association protect the interests of all associates and the company.
It is therefore important that the Articles of Association are drafted with care and adapted to the specific situation of each company.
Registration with the register of travel and holiday operators is presented as an equally unavoidable administrative formality. For a fee of 150€, this fundamental procedure, which must be renewed every three years, is considered the first milestone in your entrepreneurial endeavors.
Publication of a legal announcement is also required to signal market entry. It's a formality that reinforces the company's legitimacy. To post a notice of incorporation in a legal gazette, follow these steps:
- Choose an authorized newspaper in the geographical area of the registered office, for example on annonces-legales.fr ;
- Write the notice according to the newspaper's template, including the required information;
- Contact the newspaper, submit documents and pay fees;
- Once the notice has been published, collect the certificate of publication;
- File all the necessary documents with the commercial court clerk's office to finalize your company's registration.
Please note! It is essential to respect the legal deadlines to ensure compliance, otherwise the process will not be successful.
Obtain IATA and SNCF Train approvals 🚄
To issue airline tickets, a travel agency must be certified by the International Air Transport Association (IATA). The same is true for train tickets with SNCF Trains: these certifications not only gain credibility, but also broaden the range of services on offer.
For IATA accreditation to be achieved, an exhaustive application file must first be completed. The process requires proof of the company's financial strength, as well as its compliance with safety and professional competence standards. Often, the submission of annual financial reports and proof of liability insurance is involved. Every detail counts, so the application must be prepared with care and precision. For more information, see Tourmag's article on the subject.
SNCF Train approval, for its part, has a different approach to that of IATA: first and foremost, it is necessary to demonstrate expertise in rail travel. The SNCF assesses the ability to offer quality services and meet its standards. Once approved, privileged access to SNCF products, preview information, and competitive fares is granted. For more information, see Tourmag's article on the subject.
In the case of an online travel agency (OTA) 🖥️
Drafting obligations relating to the protection of personal data on the Internet is mandatory in France for an online company, and its varied content contains:
- A specification of potential data sharing with third parties
- Procedures to be followed in the event of a data breach
- Measures taken by the company to inform users and minimize damage
- A mention of the site's use of cookies, the objectives pursued, and how users can manage or refuse cookies.
Frequently Asked Questions🙋
What qualifications do you need to open a travel agency?
Today, no diploma or special skills are required for those wishing to set up a travel agency. This decision, applicable since the beginning of 2016, allows all those attracted by this possibility to exercise this activity. For more information on how to become a travel agent, click on this article written by Ezus.
Is it profitable to open a travel agency?
We can estimate that the average turnover a travel agency generates from each customer is around €2,500 a year. This calculation balances customers who choose economical travel with those who prefer luxury travel experiences.
How is a travel agent paid?
This remuneration can increase as you move up the career ladder. Thanks to his sales, the travel consultant can also earn commissions and sales bonuses. He or she may also have access to financial supplements such as a 13th month and profit-sharing bonus.
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All the steps required to open a travel agency have been listed, and all the keys are now in hand for starting up a business in the tourism sector: all that's left to do is create your digital shop window, i.e. your social networks and website. For more information on the subject, take a look at our article.
After that, you'll need to be rigorous and highly productive to attract qualified customers, which is why 400 of the world's top travel agencies have chosen to equip themselves with Ezus!
Dive into the future of travel management with our software solution, dramatically reducing your document creation times and simplifying the centralization of your personalized documents. Find out how during a demo.
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