Why Travel Agents Should Use Technology to Automate their Back Office
Intense competition among companies at local, national and international levels is a commonly observed phenomenon that anyone can make out. Coming up with innovative ideas that make each firm or an organization stand apart from the crowd and also delivering quality results, is a constant pressure that builds on the employees. In case of travel agencies, developing smart campaigns and building up customer loyalty is a tedious task to accomplish. It involves monetary investment, planning and execution of ideas by eliminating unnecessary expenses.
When it comes to execution, back office operations are a crucial part of any organization. Travel agents are often seen balancing and memorizing the clients and the revenues over the month. For travel agents and agencies, identifying and extracting manual activities are a challenging task due to the nature of well integrated processes at the back end. Hence, this requires identification of these manual activities at the very beginning.
Below are a few manual activities that agents come across as a part of their work routine that can be replaced by automation at back end offices:
1) Accounting and Reporting
Since allocating revenues via account is a comparatively easier, it still stands apart from costs. Why costs? Because it is difficult to calculate the cost of sales for various accounts depending upon the efforts. Consider finding out the number of hours invested in the account every month and then capturing it in spreadsheets. How about reporting exact cost and analyzing the profitability of individual accounts? Manually tracking payments, commissions and booking revenue is a complex and time consuming task that is prone to errors. Hence, using an effective Travel Agency Software for on-time reporting and calculating costs without much manpower/manual work can be a good decision. Here, making use of technology will reduce the manpower required and also the manual errors.
2) Business Intelligence related Travel Account Services
Providing progressive travel pattern reports, travel policy compliance, etc., can add to the travel agents’ business value but, it surely involves a lot of manual work. This further increases the labor expense and results in the insignificant stage of poor competitiveness, thereby leading to loss of revenue. Hence, automation of the back end office is a must to reduce down the labor cost and enhancing productivity, reducing time consumption through its integrated applications.
3) Business Rules and Revenue Management
Travel Agencies work with a wide range of customers, agents and suppliers. They vary in terms of type, location, size, booking etc and require separate business rules, such as markups and margins based on predefined criteria for effective revenue management. Traditional processes demand the manual application of these business rules for each transaction and on multiple entities.
Let’s say you have different markups for flights and hotels and you also have a commission structure for sub-agents based on the number of bookings they make. Every time you or your sub-agent makes a booking, you need to manually apply the relevant markup depending on whether it’s a flight booking, a hotel booking or a car booking. You’ll also need to calculate the commissions you need to pay your sub-agent, based on their class. If you do b2c then you may even have to apply an additional markup based on the customer class.
If you do 5-10 bookings a month, it may not be such a big problem but if you do hundred odd bookings a month or more, doing all of this manually for each booking can become extremely time-consuming and prone to errors. A Travel Agency System can automate this process and save you a lot of time and manpower cost. You just have to configure the policies once and the system will automatically apply them on every booking.
4) Supplier and Agent Commissions
Calculation of commissions of sub-agents and vendors or suppliers such as airlines, hotels, car rental agencies, etc. can get too confusing against the total revenue generated. A sophisticated travel ERP can help in calculating outstanding commissions, release payments and notify accounts of remaining or due amounts.
5) Last Minute Itinerary Changes
Corporate travel accounts often make changes to the travel plans at the last moment. Hence, customizing it manually every single time is a tedious job that makes dealing with corporate accounts less flexible for travel agents. Through an automated integrated system at the back end, travel agents can flexibly make changes in travel plans without compromising on the time. This will help in managing account relationships in a better manner and not losing out on implementing last minute changes.
How can you Automate your Back Office?
A Travel ERP is designed to provide integrated applications that work for front office as well as back office business processes. A majority of departments or processes in an organization comprises of payroll, HR and accounting.
Likewise, ERPs have the capability to render these roles effectively through their primary software applications that can help the travel agents in having standardized processes and thereby reducing the cost to company/agents. Common data structures/models and standardized processes are the most important values these ERPs can add to the back office of agents. It is because of lack of one or both of these aspects, the manual activities are carried out in non-integrated systems.
Through common data structures, the information can be collated and drafted once and can be updated or customized at individual levels as per the requirement, thereby adding flexibility to the processes and hence, reporting of information or data becomes an easy task every day.
Business intelligence is the need of the hour for the travel agents in order to have a systematic and structured flow of work processes such as accounting and payroll where the flow of information needs to be smooth.
Travel agents need to understand how travel management can be simplified through automation of back end office by replacing manual work activities with software applications that bring down the frequency of committing manual mistakes.
Investment on automation software or dedicated ERPs for travel agents is a one time investment that can resolve manpower issues and management issues of the travel agents.
Considering the recent evolution of travel and tourism industry, there has been a sudden spurt in the competitive nature of the travel industry, which demands bold investments and result oriented functions to be brought in place for increased efficiency.
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TravelCarma is a leading Travel Technology brand powering 200+ Travel Companies worldwide with B2C/B2B Online Reservation Systems, Back-Office, Mid-Office and Access to Global Inventory. Write to us on email@example.com to know more