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New Report Predicts Online Bookings Will Grow TravelJune 6, 2012 By: George Dooley Travel Agent
As the economy moves into recovery and travel trends pick up, demand will increase and fuel growth for the travel agencies industry, IBISWorld, a major research firm asserts, in a sure to be controversial report on travel agencies.
"Internet technology will drive revenue growth, as consumers increasingly choose online travel agencies for flexibility and efficiency. While this trend will effectively eliminate many smaller brick-and-mortar establishments, profitability for online operators is expected to grow," IBISWorld says.
The report, "Travel Agencies in the US", takes an unusual, non-traditional view of what is a travel agency. The report estimates that in 2011, the industry's top four players - American Express, Carlson Companies, Expedia, Priceline.com and Sabre - will account for over 75.0 percent of the available market share. This will provide the industry with a medium level of concentration, IBISWorld says.
IBISWorld estimates industrywide revenue at $19 billion and annual growth since 2007 at 2.4 percent with experiential luxury dominates, growing at 28 percent each year.
According to IBISWorld sources (believed to be ASTA), the average number of full-time employees per agency is 7.1, with 1.6 part-time and 4.2 independent contractors. The vast majority of agencies still operate with only one or two employees in total, making it a small business-oriented industry, the IBISWorld report says.
This also relates to revenue, IBISWorld says, as 34.7 percent of operators have less than $1.0 million in revenue, 24.7 percent have between $1.0 million and under $2.0 million in revenue, and 13.0 percent have between $2.0 million and under $3.0 million in revenue. Overall, 72.7 percent of members had under $3.0 million in annual revenue, IBISWorld says.
IBISWorld defines the "travel agencies industry" as including businesses that sell, book and arrange travel, tour and accommodation services to the general public and commercial clients. There is no apparent distinction made between online and offline agencies.
Its industry products, as defined by IBISWorld research, include international airline travel reservations, domestic airline travel reservations, cruise reservations, packaged tour reservations, lodging reservations, vehicle rental reservations and rail reservations. Industry activities include travel fare and reservations, tour and reservations and accommodation and reservations, IBISWorld says.
The Travel Agencies Market Research Report (NAICS 56151) was produced in May 2012. IBISWorld says its Travel Agencies market research report is a comprehensive guide to market size and growth prospects.