How travel agents survive: Niche markets, knowledge

Discount travel Web sites and online bookings dramatically changed the way leisure and business travelers find air fares, hotels and discounts on cruise packages, but northern Nevada travel agents say consumers who need personalized service and expert knowledge keep them in business.

Stuart Vides, co-owner of Business Travel & Tours in Reno, says his firm has posted steady growth through its focus on corporate travel including 20 percent year-over-year growth for the first few weeks of 2011.

Other travel agencies have found profitable niche markets, such as rail tours.

But some smaller travel agencies and those that service smaller markets such as Elko haven't fared as well during the recession as corporate and leisure travel declined at the same time that travel reservations continued to migrate to the Web.

Vides says travel agencies that focus on corporate travel remain popular because the Internet isn't good for complicated travel plans. Online bookings are fine, he says, for short trips from Reno to Boise to visit family. Business travelers, though, find it's much more complicated to book complex trips to international destinations or accommodate midstream changes in travel plans.

"We are very fortunate to have carved out a little niche that has been good for us," Vides says. "Travel is down, but there still is a need for people to go on international travel, and that is what we feel our area of growth will be in the future."

Business Travel & Tours also positions itself as a savvy consultant for people wanting to go on trips to places that they have never been.

"Most people who plunk down $10,000 on an international trip want somebody of whom they can ask questions," he adds. "That is something that is lacking on the Internet finding out about the do's and don'ts of a particular area."

Business Travel & Tours, the largest travel agency in northern Nevada, employs 14 fulltime workers many of whom have traveled to every corner of the world at its offices at Independence Square on Moana Lane.

Smaller travel agencies that don't specialize in corporate travel have been hard pressed over the past decade. Dave Wendell has owned Master Kilby's Travel on Vine Street in Reno for more than 25 years. The agency, which specializes in cruises and tour packages, today employs two, down from nine at the start of 2001.

Wendell says revenues steadily declined over the years as more travelers began using online discount travel sites but many have since come back to his office to draw on a travel agent's expertise.

Wendell says it's easy for travelers to book airfare from Reno to markets such as Las Vegas, since there is only one carrier, but he often can find cheaper fares to other destinations, such as the Bay Area, Chicago or New York, that are served by several airports and air carriers.

"Some people are not familiar with other options, and I think people are booking less on the Internet and using it more for information purposes," Wendell says.

Agencies serving smaller markets have been even harder pressed over the years.

Erin Gerber, travel consultant with Just Travel in Elko, says the decades-old agency located inside the Elko Regional Airport has struggled with the sharp decline in leisure travel and corporate booking for mining executives.

The agency once enjoyed brisk business booking flights for top executive of the region's mining companies, but that business has dwindled so much that Gerber and longtime owner Mike Lubliner have considered working from home.

Since airlines no longer compensate travel agencies for bookings agencies typically mark up airfare to compensate for their services more mining companies are booking their own travel needs, Gerber says. Just Travel adds a $35 fee to tickets it generates.

"Mines are looking for a bottom line, and the past couple of years when the economy went bad, $35 can add up," she says. "Accounts dropped off one by one, and that has impacted business quite a bit. It definitely has been tough the Internet is such a presence."

Although many travel agencies in northern Nevada have experienced sharp declines in revenues, Trains & Travel International has experienced a sharp rise in revenue the past several years from an all-time low in 2009.

Two years ago Trains & Travel International, which specializes in rail tours and train travel, offered just three tours, Rail Tours Manager Chris Skow says. Volume increased to 23 tours in 2010, and this year the company founded in 1984 has 32 tours scheduled. Trains & Travel International employs five from its office at Grand Canyon Boulevard in Reno.

Other travel agencies specialize in cruise and tour packages, where agencies still are paid commissions on bookings.

Even while the number of travel agencies contracts, Vides of Business Travel & Tours says it's difficult to recruit qualified staff. Because the travel market is so vast, Vides says, employees could learn something new every day their first five years on the job.

"The learning curve for this job is very long and very steep," Vides says. "There are a million different ways to get from point A to point B, and the amount of knowledge someone can acquire is huge."