The Key Things to Starting a Travel Business Now and in the Future

Travel is the easiest industry in the world to enter and one of the hardest to survive in. The barriers to starting have almost disappeared; the barriers to lasting are as high as they have ever been. If you are considering it, here is what I would want someone to tell me.

Start with a narrow specialism, not a destination. The instinct is to say "we sell holidays to Spain". That is not a business, it is a category with a thousand competitors and no reason to choose you. "We arrange walking weeks in the Alpujarras for people over fifty" is a business. Narrow enough to be findable, deep enough to be trusted, small enough that you can genuinely know more than your customer. Breadth comes later, if at all.

Understand your money before your marketing. Travel is a cash-flow business dressed as a margin business. You take deposits months ahead and pay suppliers later, which produces a bank balance that flatters you enormously. That money is not yours. It is a liability with a departure date attached. Every collapse I have watched in forty years — and I have watched several — came from treating forward deposits as working capital. Ring-fence client money from day one and run the business on the margin you actually earn.

Get the licensing right immediately. In the UK, if you sell flights as part of a package you need an ATOL. Packages carry defined obligations to the customer under the Package Travel Regulations, including financial protection and liability for the whole arrangement. Sitting under a trust arrangement or a consortium is entirely sensible when you begin. What is not sensible is guessing, or convincing yourself that what you sell is somehow not a package.

Choose your model consciously. Are you an agent earning commission on someone else's product with little risk and little control, or an operator building your own product with full margin and full liability? Both work. Blurring them does not. The operator's advantage is that a product nobody else sells cannot be price-shopped against you, and that is worth a great deal.

Build supplier relationships in person. This is the part technology has not replaced and, I suspect, will not. The hotel that finds you rooms in August when there are no rooms in August does so because someone there knows you and likes dealing with you. Contracts formalise a relationship; they do not create one. Go, meet people, and keep going back.

Own the customer relationship. If every booking arrives through a marketplace or an online travel agent, you are renting your customers at a rate the platform sets and can raise. Collect email addresses. Write to people properly. Give repeat travellers a reason to come directly. The lifetime value of a returning customer in travel is enormous and almost entirely determines whether the business is worth anything.

Assume disruption and price for it. Volcanic ash, a pandemic, a currency movement, an airline failure, a regional conflict. In four decades I have never seen a five-year period without at least one event that materially damaged demand. A travel business run without reserves is not a business, it is a bet on calm weather.

Now the future, because the ground is genuinely moving.

Artificial intelligence is doing to the research phase of travel what the internet did to the brochure. Customers arrive already informed, with itineraries drafted by a machine. That destroys the value of simply knowing where things are, and increases the value of judgement — knowing which of two similar hotels actually delivers, which road is a nightmare in July, which guide is worth the money. Sell the judgement. The information is now free.

Distribution is fragmenting again. Serious bookings increasingly begin with a person — a creator, a community, a specialist newsletter — rather than a search box. Small operators can reach an audience directly in a way that was impossible in the age of the high street.

Sustainability is moving from marketing to cost. Environmental levies, tourist taxes and access restrictions in over-visited places are all rising. Build them into your pricing model rather than discovering them mid-season.

And demand is polarising. The middle of the market is thinning while both the genuinely cheap and the genuinely exceptional grow. Being neither is the most dangerous position in travel today.

The fundamentals have not changed: know something specific, protect the client money, look after the supplier, own the relationship. Everything else is execution — and execution is where the industry is quietly won.