Andy Yaroch believes that when the going gets tough, there is strength in numbers. “When the economy starts to shift, more and more independent travel agents and agencies start to look for a firmer foundation on which to place their business,” says Yaroch, co-owner of Denver-based The Travel Society. “We were the first 100-percent host agency when we opened our doors. We know how to partner with travel professionals in a way that keeps them independent and keeps all of us strong.”
The Travel Society team, left to right, back row: Dan Schibler, director of recruiting; Ken Luzietti, co-owner; and Randy Yaroch, co-owner. Front row, Charissa Deter, vice president of accounting; Alison Kinnear, vice president, business administration and development; and Joan Verdon, vice president of operations.
Only five agencies signed on initially as independent contractors when the company was formed in 1986. They operated their individual travel agencies while The Travel Society provided them with accounting and administrative services. As more agencies saw the potential in the organization, The Travel Society expanded both in size and capability.
“Today we have more than 120 travel professionals with approximately $85 million in sales in 2008. They operate their businesses from 21 states and the UK,” says Yaroch. “And do you know what the difference is between those first five agents and all of these? Not a single thing. They all are members of this profession’s most elite demographic. They all came here because they are committed to success.”
Yaroch’s business partner, co-owner Ken Luzietti, agrees and adds that no matter what the economy does, the attributes of what he calls a “premier” host agency remain attractive to travel agents.
“Agents want the freedom to sell what they want to the clients they want,” Luzietti says. “And they want to leave the back-office support to competent, qualified people to complete.”
Today, The Travel Society staff takes care of many of those often tedious and time-consuming support functions for members.
Services still include accounting and administrative functions, but have grown to encompass operations, marketing, business planning, recruiting, finance and legal specialists.
Yaroch says that the business model pioneered by The Travel Society has been duplicated by others, but has never been truly copied.
“Our achievements haven’t happened in a vacuum. The host agency idea caught on and we have seen competitors come and go,” he says. “There are lots of people that call themselves host agencies now, but they aren’t talking about the same things we are.
“I believe with a passion that we are still the leaders at providing elite travel professionals the best of both worlds. The Travel Society members maintain the freedom, flexibility and independence of agency ownership while using the buying power and resources of an international corporation.
“We have the ability to cater to all kinds of business models. Whether an agency is all-corporate, all-leisure or everything in between, our focus remains the same. We want the agency to be successful.”
Luzietti believes agencies choose the type of office setup that works best for them. Many work out of one of The Travel Society’s three Colorado “in-house” office locations. Others maintain independent storefront businesses or work remotely from home or the office of their choice.
Regardless of their locale, he says, membership definitely has its advantages.
Making Dollars and Sense
“The simple truth is our agencies enjoy some of the highest commissions available in virtually every aspect of travel planning,” says Yaroch. “They also benefit from well-established, worldwide industry relationships and ample complimentary and discounted travel opportunities. And, unlike many of our competitors, our agencies are still free to select the suppliers with whom they do business. They are still free to establish and maintain their own direct relationships.”
Travel Society agents also enjoy the benefits of the company’s membership in the distinguished Virtuoso organization. Less than 1 percent of the nation’s travel agents can claim this designation.
“Through Virtuoso,” says Luzietti, “our independent contractors are able to offer amenities, experiences and access not available to the general public or even other travel agents.
“We’ve seen agents set up tours of the Sistine Chapel after visiting hours, [or] private dinners on the Eiffel Tower. One of our members even set up cooking lessons with an Italian countess and private wine tasting in Napa Valley.
“Those things add up to big payoffs for our independent contractors.”
But as Charissa Deter, vice president of accounting, is quick to point out, the only thing better than big payoffs are consistent, well-analyzed big payoffs.
With accounting office employees that boast more than 12 years average experience in travel agency accounting, Deter says The Travel Society provides individual quarterly sales analysis reports and income statements, third-party reporting through iBank and all other accounting functions associated with a host agency.
“We pay bi-weekly commissions promptly, with no more than two weeks turnaround time,” she says. “And when we need to, we can even assist agents in tracking down difficult commissions.
“Anyone who has ever had to do that knows what a time and money saver it can be to have qualified, persistent help.”
The Travel Society co-owners Ken Luzietti and Randy Yaroch both express optimism about the future of the host-agency model
In addition to the financial gains seen by members, Joan Verdon, vice president of operations, says The Travel Society has evolved in a unique way that gives members something almost unheard of in today’s business environment: community.
“Agents network in the offices and on our electronic message boards,” she says. “They provide each other with backup coverage and serve as a source of business referrals for each other.”
Verdon notes that although each independent contractor is an expert in their niche market, their clients eventually want to explore other markets.
“What if an agent is a specialist in Europe and gets a call from a great client that suddenly decides to go to Africa?” Verdon asks. “At The Travel Society, that agent simply turns to a fellow agent with expertise in that region. Soon enough, the favor will be returned. I see it every day.”
Yaroch agreed that the family environment at The Travel Society is unique.
“It is a cooperative, rather than competitive, environment,” he says. “By working together and sharing the resources and institutional knowledge they have individually, they can each appear to their customers like experts on endless facets of world travel.”
Yaroch notes that because The Travel Society is a 100-percent host agency and none of its employees sell travel services of any kind, it does not provide training to people entering the travel industry for the first time.
Rather, the company seeks out agents with their own book of business, typically with at least five years of experience, who are looking to maximize their potential.
“We offer programs to meet the needs of each individual business owner,” says Yaroch. “We’ve also attracted agents whose previous hosts have not supported their interest in business development programs, such as cruise or ‘Aussie’ specialist certifications.”
For Verdon, that commitment to customization is a matter of pride.
“We are proud of our ability to adapt as agents grow and change their own businesses,” she says. “Agents who come on board with us are entrepreneurs. They serve everything from discreet niche markets, such as adoption trips and high-end leisure, to corporate ticketing. We have to expect that they are going to be people who need us to keep up with them and support them.”
And that support is never far away, according to Yaroch. “Each agent has a primary designated support person with backup in place on top of the support that is available from the internal help desk. You really won’t find anyone here who doesn’t believe that our reason for being here every day is to serve the members. That core value helped us get started and it will carry us as far as we dream of going.”
As for the future of the travel industry as a whole, Yaroch and Luzietti both see some paradigm shifts coming.
“But we believe the host-agency model will remain intact,” Yaroch says. “We also believe, though, that more and more agents will look for solutions that help them serve their customers and receive the highest possible commissions.”
Luzietti adds, “The bottom line is, we offer people an opportunity to be more successful than they are today. They have to be able to spend more time in a down market working on their sales. That’s what we are all about.”