Are you happy with your commission split?

Are you happy with your commission split?

Are you happy with your commission split?

There has been lots written about what is the average salary for a travel agent (estimated to be somewhere between $24,000 to $35,000) and of course there are many exceptions to this and certainly we know of agents who make a lot more.

Many factors are relevant here. What type of agency do they work for? Is their commission split with the agency owner? What type of product are they selling? Do they have commercial accounts? Group business? Are they selling FIT and consolidator fares? These are just a few of the many factors that can enable an agent to earn considerably more than the average salary.

Let’s take an agent who works in a bricks-and-mortar agency. If the average agent sells $750,000 in a year, assuming an average 10% commission rate (which might be high) the agent earns $75,000 on that business. Yet most are only taking home the average salary mentioned above, i.e. $24K to $35K.

That means that the agency is only paying them 33% to 40% of the commission they are earning. And these agents are in most cases employees, paying taxes with no tax write-offs. Add to that the requirement to work regular hours, and often weekends or evenings, and you can begin to understand why a lot of agents are considering the home-based agent model.

There are many business models out there, but from my research, I have found that some agents are paid as low as 34% or their commissions earned and some are as high as 100% of the commissions earned. The average is probably 70% – 80%.

Another concern with remuneration is that many agencies only pay their agencies monthly, and some only pay them after the customer has travelled, making the agent wait months in some cases. A few pay their agents twice a month, and by direct deposit.

In other words, it pays to shop around and ask the right questions as it can make a big impact on your quality of life, your cash flow and your happiness!

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