Become a Travel Agent

A Host Agency Or A Possible Scam?
One new agent’s initiation
By Maria Spieth

There’s that old adage, “If I knew then what I know now” and boy if I did, I wouldn’t have wasted a whole year with a host agency who were more concerned with signing up new agents than helping those they had already signed up. My adventure started early June, 2006 and to this day I can’t believe I let myself get sold.

I should’ve seen the signs, right off the bat, with the job ad in the paper seducing the reader with such statements as, “Be your own boss!”, “Enjoy the travel benefits of a professional agent with awesome travel benefits!”, “Excellent tax benefits as a Self Employed Independent Contracted Travel Agent with **** Travel!” or “One the largest Travel Agencies in the Northwest” and my favorite, “We offer complete training for entry level agents”.  There it was, in glorious print online, as I sat in a cube working a life-sucking corporate dead end job. I knew I wasn’t going to make it there another year, let alone 2 more to receive a hunk of highly-polished plastic with my name on it for my 10 year anniversary. So I thought to myself, “This is it! Finally my big break into the travel industry!” and called the number listed in the ad to register for a hiring class. This set off a small alarm bell in my head, but I chose to ignore it.

The hiring class was just that, a class, filled with about 20 or so others like me (bright eyed and wanting a fresh career with others wanting to just travel for cheap) and complete with slide show highlighting all the financial and travel benefits for joining their host agency as an independent contractor. They spoke of free trips, or trips which were ridiculously discounted, $25 first class upgrades on flights and having preferred commission agreements with top paying vendors. They even spoke of how (as travel agents) we could make an average of $70,000 annually, which was the industry standard income (so they said). All this displayed in front of us, with big emphasis on the numbers with dollar signs and photos of exotic far off destinations. They highlighted how affordable it was to join with their registration & agent fees being less than most host agencies that offered less. I thought their beginning commission split was low at 50/50 with more experienced agents starting at 70/30, but this was all “industry standard” they said. And for only $49 we could get a “CLIA card” to show we were travel agents. I joined not because of all the goodies offered, but because I wanted to be a professional agent and I figured this was my “foot in the door”. It wasn’t until later I found out they had these hiring classes about 2-4 times a month. Even as I type this, I’m staring at 1 of a list of 5 of their job ads online.

After about a month of attending every training class I could possibly get my hands on, hosted by the owner and his wife, I started to see beyond the smoke and mirrors. They both emphasized the importance of us booking more than just air & hotels for our friends and family. It was more a sales pitch, one of those 90 minute time share deals than a training class. We needed to book cruises and tour packages, they said, or we were wasting their time, and of course, our own. The tone was more “sales pitch” rather than a training course. With the free courses they offered in-house, they also would have vendor taught courses for a fee of $59. I only found out by accident the same Hawaii Specialist seminar held at the agency by the Hawaii Tourist office was free online at the Hawaii Tourist website. This wasn’t the only class sold to us for $59 that was really free. All the Tourist or Tourism Board taught seminars were for a fee. Shortly after the Hawaii revelation, I stopped going to their training classes and focused online for training (see www.travelagentacademy.com, www.recommend.com, www.thetravelinstitute.com). I noticed staffing issues they were experiencing, especially with their accountants. In the first 5 months I met 3 different accountants and noticed the owner’s wife filling in when there wasn’t one. Commissions had a tendency of being late and not always the correct amount. They had a rule: If your commission isn’t more than $50 total for the month, it wouldn’t be paid out until it was over $50 on their books. At one point, becoming increasingly suspicious with the agency, I asked the owner if I would find it beneficial to attend an upcoming travel agent expo in California. Looking me dead in the eyes, point blank, he said it would be a waste of time since it was nothing more than other host agencies soliciting agents.

The last straw came when I finished Sceptre Tours Emerald Partner program about 5 months into my 1 year contract with “the agency”. I asked, excited about my accomplishment, if I could have permission to use the agency’s name on the personalized booking engine website Sceptre would create for me as a benefit of their program. They said I couldn’t use their name as a contractor unless the leads Sceptre referred to me (an Emerald Partner program benefit) came directly to the agency first. Why? So the agency could forward the leads to their preferred agents, not necessarily the agent who was the Emerald Partner. Having spent almost 3 weeks pleading, I dropped the issue and stopped my growing involvement with the agency, completely awake now to the giant mistake I made signing up. About 2 months later, one of the training courses on the training schedule was with Sceptre Tours.. You guessed it, to become an Emerald Partner!

Needless to say I couldn’t wait for my contract with them to end. I was only in for the registration fee of $150 and a monthly “website” maintenance/access fee of $30 lighter. It was a small price to pay, I thought, for the huge lesson I learned. Besides ticking the days of my contract away studying travel courses with Princess, Cunard, Ireland Tourism and attending industry expos, I also researched host agency after host agency. This time I wasn’t going in eyes wide shut! When my contract ended in June 2007 I celebrated with a friend, also an agent, who also experienced a similar nightmare there. We’ve since partnered up and created Renevatio Travel, using a different (and better!) host agency. No one should have to experience anything like what I did and I consider myself lucky. The same friend had to deal with commission payment issues with them for most of her 1 year contract. I, on the other hand, booked only 1 air ticket for a whopping $12.50 commission (after the split of course) on which I’m still waiting. But its ok, they can have it, I’d rather not exert the effort. Another colleague is fighting with them for commissions dating back to 2006. Like I said, I’m lucky.

Now I understood why they were hiring every month, it was to keep up with the agents like myself who would leave or fade away. Though we still were under contract and they receive that payment regardless of if we booked anything or not. It was the loss of those possible bookings which kept them hiring more and more agents to maintain “status quo”. And the number of agents they boasted of having to vendors, clients and even new hires fluctuated between the numbers “600” and “800”. Imagine the money coming in if those numbers were true. Let’s do the math, based on 2 hiring classes a month with 15 new agents each class with a registration fee of $150 and the monthly $30 for 1 year: (30 x $150 = $4,500 x 12= $54,000)+(30 x 30 = $900 x 12 = $10,800) = $64,800. This is just new agents, mind you, and doesn’t touch upon the veteran agent base of a few hundred or any commissions earned. Imagine it. I stopped thinking about it because I’d rather not get upset over what I consider a scam.

Since leaving, I’ve learned more on my own and through industry websites in the last 8 months than in the full year I was under contract (except for my naivety on host agencies and the travel industry in general, of course). Now much wiser and much happier, I hope to help others through the pitfalls of finding a good host agency. We learn by example, so let mine be your example.