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The Travel SocietyMarch 3, 2008 By: Travel Agent Central Contributor Travel Agent
Host agency with more than 100 members charts a course for expansion
THE TRAVEL SOCIETY IS THRIVING. Since purchasing the Colorado-based host agency in May 2005, co-owner Randall Yaroch says its annual revenue has jumped from about $70 million to $96 million. The membership, composed of affiliates (agents working from home or their own commercial location) and associates (those who work in The Travel Society's three Colorado offices), has climbed from 97 to 113, spread among 14 states, the U.K. and the Caribbean.
Approximately 60 percent of members are affiliates who work from home, in an office building or at a retail site. "Typically, at-home agents are people who have been in the industry and have a book of clients who have a great loyalty to them," says Yaroch. He adds that about 20 percent of the affiliates are women with children, and many others are agents 55 or older whose clients have stayed with them.
The opportunity to work at home appeals to a growing number of travel consultants. Tamara Gorenc, an affiliate, paused between visiting vendors at The Travel Society's annual meeting in Denver in January to explain that she loves it. "It enables me to be home with my family when they need me. My clients don't know that I'm there. As far as they are concerned, it's still a very professional office."
Other consultants prefer the associate option because it's more social. For example, associate Dana Welch, who specializes in adventure travel and was on Travel + Leisure's 2006 A-List as a "Super Agent," works out of the office in the Cherry Creek neighborhood of Denver. She's been a Travel Society member for 10 years, but an agent much longer. "I'm an independent agent," she says, "but I have the buying power of a huge agency because there are so many of us." Welch adds that even though everyone is competitive, it's "lovely to pick other people's brains, and we share a lot of information."
Suppliers are learning to love Travel Society consultants because they tend to be successful in niche markets. Some 75 vendors showed up for the Travel Mart trade show at the annual meeting. Howie Perlin, national sales and marketing manager for Ya'lla Tours USA, says that he and many of his colleagues realize that Travel Society members are the people who are concentrating on markets that they resonate with.
"The home-based independent contractors are now the journeymen and journeywomen of the business," he says, "and some of the most sought-after [agents] because they are some of the most professional, most interested and most entrepreneurial. Twenty years ago, 'outside agent' was a pejorative term; they were kitchen agents. They've come full circle and now they are some of the most adept and technologically knowledgeable."
Paulette Kaufman, Ritz-Carlton's West Coast regional director, travel industry sales, who met with agents at the Travel Mart, says, "The Travel Society put together a necessary resource for reaching the home-based community, which is clearly the wave of now and the future."
The Travel Society's strong relationship with Virtuoso was evident during the meeting, where the consortium did a presentation on "How to Be a Star Using Virtuoso Onsites." Virtuoso feeds The Travel Society's members a lot of business, according to Yaroch.
After Yaroch and his partner, Kenneth Luzietti, purchased The Travel Society, they developed a marketing plan to generate growth. The plan included increasing the number of independent contractors, focusing on staff who ensure service to member agents for marketing assistance and problem solving, and partnering with Virtuoso to capitalize on its programs.
With the goal of growing even bigger, The Travel Society has hired Dan Schibler, a former United Airlines representative, for a new director of sales position, and it's formulating plans for national and international advertising and direct mail pieces. Yaroch and others at the company belong to industry-related advisory boards to raise awareness of The Travel Society. The group also attends different trade shows.
"It all has to be service, service, service." Yaroch stresses. The Travel Society provides members with back-office support in financial management and technology, plus a portfolio of vendors. Members have access to a password-protected Internet site, which is a one-stop resource with links to air, car, tour, cruise and other suppliers, so bookings can be done online.
"Based upon our volume of business, we enjoy a much higher commission, which is in turn passed on to the independent contractors," Yaroch says. "The ones that are making the most money here are the ones who have niche expertise. Then, it's [up to] word of mouth to get their clients."
Associates who work out of the agency's offices (which are in Denver, Lakewood and Boulder) pay a flat fee; affiliates are on a commission split. Agents retain 100 percent of all service fees, 100 percent of all airline commissions and 80 percent of all commission sales. They receive detailed monthly reports and commissions are paid bi-weekly.
The bar for membership in The Travel Society is high: Every year, at least some members are named to the Travel + Leisure A-List or Condé Nast Traveler's "best travel agents" list, according to Yaroch. The requirements to join have been modified, though, to reflect the changing demographics of travel consultants, now that more people, such as lawyers and CPAs seeking a second career, are coming into the business.
"We were looking for people who have three to five years' experience; now we are just looking for people with two years' experience and a great business plan," he says. Agents hear about The Travel Society from others in the business or see a listing on websites of industry organizations such as NACTA, ASTA and APTA.
Yaroch notes that changing market conditions are affecting where people travel. "We are concerned about the dollar to the euro. We are finding that our cruises and destinations in the Caribbean, Mexico, South America and Hawaii are growing again. There's a market shift from Europe to these destinations now," he says, adding that Italy, river barging in France, hiking in mountain destinations like the Himalayas and swimming with dolphins are sectors that are doing well.
"The other good news is that the supply of new products has increased substantially," says Yaroch. "St. Lucia and Costa Rica are always a big hit, and now there's infrastructure for four- and five-star products in countries such as Argentina, Chile and Peru."