How to start a travel agency

If you’ve got a love for travel and a penchant for organisation and planning, starting a business as a travel agent might be a dream venture. However, turning that passion into a successful business requires more than just a love for travel: it demands an understanding of industry regulations, strong supplier relationships, and exceptional customer service.

Independent vs Host Agency: Cost of starting a travel agency (2026)

There are two ways you can start a travel agency business – either independently or through a host agency. Here’s a rough breakdown of the typical costs involved for both avenues.

Cost category	Fully independent agency	Host agency/travel franchise
Initial upfront fee	£0	£140-£300 for homeworker/independent networks or £3,000-£8,000 for premium franchises
Regulatory capital requirement	£15,000-£30,000	£0 (covered under the host's financial structure)
ATOL licensing (flight protection)	£1,523+ (£300 application + £1,223/yr for a Small Business ATOL)	£0 (you use the host's ATOL license)
ABTA bonding & fees	(£300 application + £1,223/yr for a Small Business ATOL)	£0 (You use the host's ABTA numbers)
Commission split	You keep 100% of what the supplier pays	Approximately 70%-80% (the host takes a cut of your commission)

What is a travel agency – and why should I start one?

A travel agency is a business which delivers expert advice and tailored travel experiences for individuals or groups. It acts as an intermediary between travellers and travel suppliers, such as hotels, airlines, car rental companies and tour companies, and the majority of agencies operate online, often from home-based setups.

Starting a travel agency can be an exciting venture. Not only can you base your business at home, making it a very flexible career path, but you also benefit from forging global connections and helping customers plan their trips of a lifetime. As younger generations continue to seek out unique travel experiences, it’s a good time to cash in on the rising demand for curated travel advice, too.

The business model won’t be right for everyone, though. Due to the demands of the profession, it’s best suited to individuals with strong organisational skills, a passion for customer service, and, of course, a love for travel.

How to start a travel agency in six steps

Just like planning the trip of a lifetime, starting a travel agency requires careful foresight and planning. We guide you through the process in easy-to-follow steps:

Step 1: Write a travel agency business plan

The first stop on your itinerary will be creating a comprehensive travel agency business plan. This document will serve as a crucial roadmap, guiding every decision you’ll make when starting, operating, and growing your business.

Your business plan should include the following:

• An executive summary
• A clear company description
• An outline of the services you offer
• An outline of your management team and their roles
• A breakdown of your marketing and sales strategy
• Detailed financial projections of at least the first three to five years
• Your potential routes to market

You should also clearly identify your travel agency’s niche to help differentiate it from the competition. For example, are you specialising in luxury escapes, LGBTQ+ tourism, or eco-travel? And if so, what steps are you taking to understand this specific market and tailor your offerings to them?

You can also use a business plan template containing pre-formatted sections and prompts to help get the ball rolling.

Step 2: Register your business

After you’ve solidified your business plan, it’s time to make things official by registering your company’s name. Before you do this, however, you’ll have to choose your business structure. In the UK, you’ll have two primary options:

• Sole trader: Registering as a sole trader is by far the most straightforward option. You’ll be liable for all your business’s debts, but you’ll be able to keep its profits. To get started, you simply need to register for Self-Assessment with HMRC.
• Limited company: Registering as a limited company will create a legal entity for your business, meaning that your personal assets are protected if debts occur. However, this option features heavier regulations and incurs higher startup costs.

To ensure your travel agency is legally watertight, you’ll also have to explore insurance options like professional indemnity insurance and public liability insurance. Investing in ATOL (Air Travel Organisers’ Licensing) protection is also a non-negotiable if you plan on selling package holidays which include flights. If you carry fewer than 500 passengers a year, you can get a Small Business ATOL (SBATOL) instead.

You might also consider joining a trade body membership like ABTA (Association of British Travel Agents) or Global Travel Group, if you’re interested in boosting your credibility from the get-go.

Operating a remote travel agency in 2026 also involves managing personal data – including clients’ passport details, medical requirements, and credit card numbers – so compliance with the UK’s GDPR is an absolute must. This includes:

• Not allowing clients to text or email unencrypted photos of their passports, visa documents, or credit card details.
• Implementing a secure and password-protected platform where clients can upload their documents safely.
• Enforcing multi-factor authentication (MFA) to reduce the risk of remote data breaches.
• Clearly informing your clients exactly how long you store their information, where it’s archived, and when it’s permanently removed from your systems.

You will also have to pay an annual data protection fee to the Information Commissioner’s Office (ICO). How much you pay depends on your business size, employee count, and annual turnover. Here’s a quick breakdown of the fees:

• Tier 1 (micro-organisations): £52
• Tier 2 (SMEs): £78
• Tier 3 (Large businesses): £3,763

Step 3: Choose your model

The travel industry is evolving with the digital age, and traditional high street travel agents are quickly being outpaced by virtual agents that can be based anywhere. This shift offers considerably more flexibility for newcomers to the market. This being said, you still have options when it comes to choosing your business model.

1. Start a travel agency from home – Remote setups offer the lowest barrier to entry for entrepreneurs, due to minimal startup costs. However, you’ll have to bear full responsibility for staying legally compliant and marketing your agency.
2. Buy into a franchise model – By leveraging another agency’s brand recognition and tried-and-tested business model, you’ll avoid the risks of having to start from scratch. The drawbacks are that you’ll have to make a bigger initial investment and sacrifice some creative control.
3. Partner with an existing host company – Operating under a host agency will give you access to their supplier commissions, booking systems, and training and mentorship schemes. The tradeoff is that a portion of your commission will go to the host company.

Step 4: Set up systems and suppliers

Software systems help to ensure the smooth running of your travel agency. So, before you take your business live, you’ll have to research and invest in the right operational systems.

Some non-negotiables for travel agents include specialised booking software to automate reservation and booking enquiries, a customer relationship management (CRM) system to manage client relationships, and Voice over Internet Protocol (VoIP) systems to allow you to connect with customers and clients over the phone.

Additionally, you’ll need to arm yourself with a strong network of trusted suppliers. Depending on your business model and niche, this could involve reaching out to tour operators, car rental companies, airlines, and cruise lines. It’s also important to bear in mind that if you’re setting up a travel agency yourself, you’ll be responsible for managing these supplier relationships directly.

Step 5: Market your travel agency

Now you’ve got all the basics in place, it’s time to get the word out. As the travel agency market grows increasingly competitive, an effective marketing strategy is crucial in cutting through the noise.

• Build a brand identity – Consider what makes your travel agency unique, and communicate this in your name, logo, values, and communication channels.
• Target your marketing campaign – Don’t try to appeal to every traveller. Tailor your campaign to niche customers using tried-and-tested target marketing strategies,
• Launch social media campaigns – Social media sites are hotbeds for travel content. So, launching marketing campaigns on popular networking sites like Instagram, TikTok, and Facebook is one of the best ways to reach potential customers.
• Attend travel events and fairs – Promoting your business in person helps you connect with potential clients and suppliers directly. Start by researching travel events, industry expos, or fairs in your local area.
• Partner with local businesses – Don’t forget about the customers on your doorstep. Local marketing offers mutually beneficial opportunities for you and businesses in your neighbourhood – from luxury boutiques to wedding planners.
• Don’t forget print! – Print isn’t dead, yet. Securing an ad in a local magazine or newsletter is an effective way to get eyes on your travel agency. Learn more about the benefits of print marketing here.

Note: All your marketing material, terms and conditions, and pricing must be completely transparent. Any hidden fees or misleading descriptions violate Trading Standards and the Fraud Act.

For example, you can’t list a holiday for £500, and then slowly add non-optional fees (such as resort fees, service charges, luggage fees, etc.) as the customer continues their booking. This is known as “drip pricing”, and as of April 2025, it has been banned in the UK under the Digital Markets, Competition and Consumers Act 2024 (DMCC).

Step 6: Scale up

Your business won’t grow by itself. Once you’ve successfully established your brand and are turning a healthy revenue, it’s time to focus on expansion.

If you’re a solo operation or a small team, consider bringing on more talent to help ease workflows or help you expand into new areas. If you don’t have the budget for full-time workers, hiring independent contractors can be a more cost-effective way to relieve the burden from your existing team or one-person show. That way, you can expand your business’s capacity during peak seasons (like school summer holidays) without committing to permanent fixed payroll costs.

Looking for ways to add to your core offering can also be an effective way to unlock more profits. If you’re already operating within a niche, you could deepen your expertise by launching ultra-specialised packages. Alternatively, if you offer general package holidays, consider specialised offerings like wellness retreats or volunteer trips, which could attract a whole new segment of customers to your business.

How much does it cost to start a travel agency?

With so many variables at play, the cost of starting a travel agency will vary from business to business.

However, as a general rule of thumb, it’ll cost anywhere from £1,000 to £20,000 to get a travel agency off the ground, depending on the model you choose, and other factors like the area you specialise in, and the intended scale of your business.

Here’s a rough estimate of how much you can expect to pay, based on the chosen model of your travel agency:

• Home-based: £1,000 to £5,000
• Franchise: £5,000 to £15,000+
• Independent with website, software, and marketing: £10,000+

Here’s a breakdown of potential costs to give you greater insight into how much the venture could cost you:

• Laptop and other tech – To launch a remote travel agency, you’ll need a reliable computer or laptop and a fast internet connection. This will cost you anywhere from £300 to £1,500
• Website development – You’ll need to build a website for your travel agency. The cost of building a website can vary from £1.99 per month to over £4,000 upfront, depending on whether you decide to build it yourself or outsource the task to a professional.
• Booking system – While many website builders offer this service in-house, an independent booking system could cost you around £1,600 to £4,000 upfront, or £40 to £200 per month for a rolling subscription.
• Business insurance – Professional indemnity and public liability insurance is a non-negotiable for travel agencies. Costs start from around £5 to £10 per month.
• Business certifications – If you want to enhance the credibility of your travel agency, you can take an accredited course. Online CPD verified courses can cost anywhere between £30 to £100.
• Industry memberships – Memberships like Pacific Asia Travel Association (PATA) UK & Ireland can offer valuable networking opportunities to help lift your venture off the ground. Annual fees start from £70 for individual members.

If you don’t have a lot of start-up capital, it’s entirely impossible to start a travel agency on a budget, if you do it from home with a lean setup.

Support is also available for new business owners to help ease financial strain. Learn more about what funding opportunities may be available to you in our guide to small business grants.

Six cost-saving trips for travel agents

Launching your own travel agency doesn’t need to sink your savings. Here are some practical tips to keep your startup expenses on track.

1. Join a host agency – Host agencies provide access to supplier relationships, booking systems, and staff training, saving you the costs of investing in all these services separately.
2. Negotiate supplier deals – Don’t be afraid to negotiate stronger rates with trusted suppliers, to avoid paying more than you need to.
3. Partner with a franchise – Reduce upfront risks by partnering with an established franchise. Doing so will prevent you from needing to build your reputation and operational processes from scratch.
4. Work from home – Circumvent office rent, utilities and commuting expenses by investing in a solid home working set-up instead.
5. Rent software monthly – Avoid hefty up-front fees by opting for pay-as-you-go website builder, CRM, accounting, or booking subscriptions.
6. Network for referrals – Establish relationships with local businesses, like local photographers, wedding planners, and spas, to create mutually beneficial marketing opportunities.

Charting a course for success

As consumers continue to seek unique, cost-effective, and convenient forms of travel, now is an opportune time to tap into the growing demand for travel agents. It’s now easier than ever to sell dream holidays and trips from your own home, lowering the barrier to entry for aspiring business owners.

This doesn’t mean your journey is guaranteed to be smooth sailing, however. From increased competition and rising business rates, your path to success will likely be paved with several challenges. Yet, by remaining resilient and using the steps in this guide as a compass, you should be able to hit the ground running.