The Barefoot Investor: Travel agent vs Online

Scott Pape is known as Australia’s favourite money guy. We'll be bringing you his fantastic travel-related tips, hints and advice on a regular basis so stay tuned: 

“Calm down” said my better half.

She had a point. I was after all, arguing toe to toe with a Coles robot-checkout-chick – and losing.

“Place your items in the tray”, robot-woman kept saying in her smarmy, thirty-something, synthesised speech.

“They are in the freaking tray!” Defeated, I grabbed my environmentally friendly shopping bags and headed for the exit.

My girlfriend trailed, trying to lift my mood. “Where do you want to go on holidays? Let’s book something today”, she said, pointing at the travel agents on our way out.

“The internet has killed travel agents”, I grumbled as we walked in.

“Well someone forgot to tell them. Have you noticed how many travel agent shops there are?”

Travel agent versus online
Like me, you’re probably starting to think about booking your Christmas holiday – and that probably means jumping online. Me too. I’m a huge fan of DIY. I’ll search for hotels on TripAdvisor.com, and I’m the type of guy who uses Webjet.com.au to see all the flights and then books directly with the airline to bypass their booking fee.

Yet when I finally got to speak to an agent, I quickly realised there are some good reasons why you should consider using one.

Ask any Flight Centre advisor and they’ll tell you their job is about one thing: selling, and in large volumes (because their commissions from the airlines keep getting crunched as more people move online).

Most airlines pay around 5 per cent commission on international bookings (and nothing on domestic fares). Some airlines will also offer the bigger travel agencies further commissions to get them to push their seats.

It’s a similar situation with booking hotel accommodation. Travel agents get around a 10 per cent commission from hotel bookings. And while booking a room online feels like you’re getting a bargain, the fact is that Wotif.com, the online leader, charges exactly the same commission (which is how they make over $50 million in profits a year).

On top of these commissions most agents will charge you a ‘service fee’ that’s dependent on how much work is involved, how annoying you are, and (sometimes) how much the agent thinks they can get away with.

When to use a travel agent
Despite the commissions, there are three reasons you should consider using a travel agent:

First, if you book an overseas fare online, in most cases you’ll be paying the same price as the travel agent – the airline just keeps the commission.

Second, when you travel overseas, having one point of contact if anything goes wrong (Qantas strikes, natural disasters, cancellations) is much better than dealing with the Qantas call centre.

Third, and most important, it’s convenient. Having an expert arrange your travel can save you time and stress. And most agents have some pull and should be able to get you a better room or a choice of seats, or at the very least give you their expertise on places to see.

That being said, if you’re organised and willing to book well in advance, you can save money by doing it yourself.

This article originally appeared on Scott's website, The Barefoot Investor. 

What are your thoughts? Have you booked through a travel agent recently? Tell us about it in the comments section below. Then head to twitter and Facebook to keep the conversation going with other Gecko's travellers.

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