Last week as part of my continuing campaign to put more money in travel advisors’ pockets, I talked about fees as an important revenue source.

Today I am getting specific about how much to charge and how the process works. So, Let’s dig in!

The first question every agent has about fees is, How much should I charge? To quote my colleague Lisa Fletcher, who is famous for saying well, it depends. There are a lot of factors that go into setting fees, including:

  1. The level of service you are providing
  2. The type of travel you are planning (luxury travelers pay more than premium travelers)
  3. Where you live
  4. How much experience you have
  5. The connections you have

Here is what has no bearing on fees:

  1. What vendor is being booked
  2. How much commission you earn on the booking

Simply put, fees are not about the amount of money you stand to make by booking a trip. Fees are about YOU – the service you provide, the expertise and connections you offer, and the fact that you are there to help them whenever they need it. It’s about what you are doing for the client. Period. This is why I don’t like “plan to go” fees. This is a fee that is charged by the agent as a hedge against a client picking their brain and then booking elsewhere. When you have this kind of fee, you aren’t really charging for your time and expertise. You are insuring against the prospective client and wasting your time. It doesn’t show that you value your expertise. So let’s stop charging those, OK? Instead, focus on the value that you bring to the client relationship. If you aren’t bringing any, you don’t deserve a fee. It’s a sliding scale. The more value, the greater the fee.

Right about now, the fee doubters are saying, But I can’t charge a fee because:

  1. None of my competitors do
  2. The product I sell
  3. Where I live
  4. I've never charged one in the past

None of those are valid reasons. Seriously. For every agent who gives me one of the reasons above, I can name five who are in the same situation and are effectively charging fees. And sometimes even large fees! At this point, let’s assume that you are on board with charging a professional fee that you keep yourself. The question is: How much do I charge?

Again, it depends. I know travel advisors that charge $150 and some that charge $1500. Some charge a flat rate depending on the type of travel (e.g., FIT), and some that charge by the hour. Let’s keep this simple and go with what the majority do: a flat fee per “booking” (in other words, not per person or per day, but for planning the trip).

The first thing you need to do is get clear about the value that you offer (that was homework from a few weeks ago).

Now, how do you put a price on that? Think about it for a second. When I ask you what fee you deserve, what is the first number that pops into your head? That number is probably a good starting place. And here are a few suggestions to help you tweak the answer:

  1. Make your fee at least $150. If you make it too low, it seems like a penalty. If you charge $50, that seems punitive, not professional
  2. Keep it simple. Don’t get into a lot of different scenarios when you are first getting started
  3. While you want to keep it simple, have another level of fee that you are comfortable with for more complicated trips or for multiple couples/families traveling together

The fee amount I see most often? $250. Maybe that feels like a good place for you to start. Maybe it seems too low. That’s OK too! You don’t have to publish your list of fees anywhere (some agents do, but you don’t have to), but I do encourage you to write it down. Put it somewhere you will see it often to help get comfortable with it.

The next question becomes how you present the fee to the client. It is very important that you do this AFTER you have had a chance to demonstrate your value. Meaning you do need to have some level of conversation with the prospective client first. Do NOT do this over email, text message, or social media. Do it on the phone, via video chat, or in person. If the client won’t talk to you on the phone, they probably won’t pay your fee. So why bother keeping up the communication thread? After you have talked about what it is they want in a vacation and you have determined that you can add value AND that you want to work with them, I suggest presenting the fee this way:

“This vacation sounds amazing and I would love to assist you with it. So, I’d like to explain how I work so we can get started.”
At this point describe the process of working with you. Remember, this prospect might not have worked with an agent before and not how this works!

After you do that ask, “Does this sound like the type of assistance you are looking for with your vacation?”
Stop talking and let them answer the question. If they answer “yes”, then you can introduce the fee by saying, “Wonderful! My professional fee for this type of vacation is $250. I will send you a link to pay that via a secure website and then we can get started planning. Ready to get started?”

If they hedge about paying a fee, it could just be that they weren’t aware that is how it worked. That isn’t an automatic no!

Answer their questions and they may decide to proceed. If they answer “no”, that’s OK too! Some people aren’t going to pay a fee. That just means they aren’t your client. That frees up space for you to work with someone else. Once they say yes you need to have a procedure in place to collect the fee. Remember, this is a professional fee and you shouldn’t try to hide it in the booking. You should process the fee yourself (or through your host if that’s required). Be aware of rules if you or the client is in Florida or California where there are restrictions on this.

Final tip: don’t do the work until the fee is paid. Don’t say, “great” and then plan to process it later. Process it now. Once the credit card is entered and the fee is paid, then start work!

Whew! I just threw a lot of stuff at you, didn’t I?

I’d love to hear what you think about this. Leave a comment below or send me an email.