Travel agent money management is an essential art to master in the aftermath of the COVID-19 pandemic. The industry has already seen a rise in travel in the early months of the vaccine, with TSA traveler throughput volumes increasing 55% from February to March alone. As the travel industry starts its ascent back to pre-COVID level travel volumes, a steady and predictable cash flow can help maintain travel agency business throughout recovery. Consider the following tips for managing travel agency revenues and cash flow to prepare for COVID recovery.
Automate Your Business Finances
It may seem like travel agent commission money management 101 but keeping up with inbound and outbound payments can be overwhelming for a busy travel professional. Managing a general ledger, while time-intensive on the surface, is a gift to your future self. You will not have to deal with the stress of being disorganized come tax time or spend excessive time reconciling and matching inbound payments or automatic outbound payments. The time-savings down the round trumps the mild inconvenience of today by leaps and bounds.
When you imagine a business general ledger, you may envision a giant leather-bound book that requires a quill just to document within the pages, but one of the greatest advantages of living in in the 21st century is the convenience and ease of digital, automated bookkeeping. There are several free online ledgers that will satisfy the needs of small- to mid-size businesses and the host of capabilities keep growing with time and technological advancement. The general ledger can easily become your single source of truth for inbound and outbound payment processing, helping you to understand exactly where you land in terms of cash flow for your business.
Consider a Travel Agent Fee Structure
For successful travel agent money management, commissions are the number one priority to increase cash flow but supplementing your income with thoughtful fees can also be a great way to bring in additional revenue through recovery.
There are several ways to manage the process of implementing fees, one of the most popular fees being an initial non-refundable deposit for clients upon first requesting services. This fee is a great insurance policy for clients who may not be fully ready to book when they first engage. Read the Onyx eBook that goes in-depth with travel agent commission fees for other tips to maximize agency cash flow.
Reassess Vendor Costs
While you are monitoring and tracking payment inflow, it is worth considering accounts payable. The saying “It takes money to make money” is popular because there is a ring of truth to it. The funds in these accounts are used to invest in business growth, and these costs can be marketing related, vendor costs, costs for third-party platforms and more.
Examine these accounts and payees and mark the dates that you will need to reassess and re-sign any contractual obligations. Look for ways to trim costs and prepare to negotiate when the time comes.
Many vendors are even offering COVID-19 cost incentives to travel companies who have been especially impacted, so be on the lookout, and do not be afraid to speak candidly about your financial situation with essential vendors.
Use Virtual Payment for Travel Agent Money Management
There are several ways that agencies receive money for their services. B2B payment types run the gamut across payors, but you may have already taken note of some of the payment types that enable faster receipt of payment. Travel agent commission payments have traditionally come in the form of check payments unless the agency is using a commission payment consolidation solution like Onyx’s Sure Pay that provides a broad range of payment options, including direct deposit. If you are not utilizing commission consolidation services, you can still benefit from the latest innovation that is changing the way that some agencies are paid.
Virtual payment, in the form of virtual credit cards (VCCs), has been an essential part of travel payment for over a decade, traditionally used by agents as a form of payment for their client’s stay at a hotel, but recent innovation has allowed an entirely new way for travel agents to receive payments for their hotel commissions as well. Virtual credit cards hold a host of benefits for agencies that make them a much more efficient payment option for agencies. VCCs essentially remove the risk of losing a payment or having it be stolen or lost in the mail as can happen with traditional check payments. Virtual payment also cuts down the time necessary for bank processing on both ends to allow agencies to realize their payment faster than traditional methods like checks and wire payment making them a smart choice to increase cash flow and support travel agent commission money management.
How Are You Managing Your Travel Agent Money?
No matter what steps you decide are right to take for your travel business, Onyx CenterSource can help provide cost-effective solutions for managing travel agent money through recovery and beyond. Reach out to an Onyx representative today to learn more about our payment products.