Independent Travel Agent definition

Defining the Term

In the early days of what I like to call the Home-Based Travel Revolution, the definition of a “home-based travel agent” was pretty straightforward. That was back in the 80s and 90s. But times change and what was once a small (and controversial) phenomenon has grown into a major force in the travel industry.

As this segment of the travel distribution system has evolved and matured, however, precise definitions are getting a bit trickier.
Broadly speaking, a home-based travel agent is anyone engaged in the marketing and selling of travel products from a home office. But that can cover a wide variety of different types of home-based travel agents who might have very different looking businesses.

Even so, in the travel industry and more specifically in the travel distribution industry, the term “home-based travel agent” is most often used to refer to someone who works out of their home office as an outside sales representative for a bonded, accredited travel agency, usually referred to as the “host agency.”

The home-based travel agent finds, qualifies, and books the customer; the host agency prints the tickets (if any) and serves as the conduit between the home-based agent and the travel supplier whose product the home-based agent is selling.

The home-based travel agent and the host agency share the commissions paid by travel suppliers according to a negotiated percentage split that reflects (or should reflect) the amount of work and effort expended by each party in making the booking happen.

But as we shall see, these days there are some “home-based” travel agents who operate out of commercial premises outside their home. So maybe the definition should revolve around the particular business model these independent agents use or group of strategies they deploy to reach their business goals. Some have suggested that “non-ARC agency” is a better term.

Some are even asking “Is the term home-based travel agent obsolete?” That is, whether we are a “traditional” travel agency operating form a “brick-and-mortar” location on Main Street, a home-baser working from a spare bedroom in our pajamas, or a hybrid business that has set up shop in a rented space, we are all just travel agents

Options for the Home-Based Agent

By definition (as well as by contract), the home-based travel agent who funnels bookings through a host agency is an independent contractor, which means that he or she has a great degree of freedom as far as determining how and with whom to do business.

By law, an independent contractor is not an employee. But what if a home-based agent does all her business with a single host agency, as many do? This can raise some tricky issues for both host and agent, which I discuss in The Home-Based Travel Agent Success Course, along with some simple steps you can take to avoid any confusion or problems with the IRS.