Thinking of Buying a Travel Agency in Australia? Here Are 3 Vital Questions to Ask

The Australian travel agency and tour arrangement industry generates around $12.8 billion in annual revenue in 2025, employing over 26,900 people across nearly 8,900 enterprises.

Profit margins average 7.1%, equating to approximately $909 million in annual profit, with revenue forecast to grow at 3.2% annually through 2031, reaching about $15.1 billion.

After enduring extreme volatility during the pandemic, the industry has stabilised, driven by a resurgence in both domestic and international travel. However, the rapid rise of online booking platforms and AI-powered itinerary tools has permanently changed the landscape, forcing traditional agencies to adapt their models and focus on specialised, high-value services.

1. Is the Business Financially Sustainable and Resilient to Industry Change?

Why It Matters:

While demand for travel has recovered, traditional agencies face margin pressure from reduced airline commissions and online competition. Long-term profitability depends on the business’s adaptability, operational efficiency, and focus on niche or corporate clients.

What to Check:

• Profit margins and benchmarks – Compare results against the 7.1% industry average, noting that online agencies often operate with lower costs and higher scalability.

• Revenue sources – Corporate and group bookings now make up over 18% of total market share, offering greater stability than leisure bookings.

• Commission structures – Major airlines have cut agent commissions from 5% to as low as 1%, so diversification into service fees, packaged tours, or consulting is vital.

• Overhead structure – Businesses operating online or through hybrid models have seen rent and wage costs fall sharply since 2020, improving efficiency.

2. How Competitive Is the Business’s Market Position?

Why It Matters:

With online travel agents and metasearch platforms dominating the consumer market, competition is fierce. Successful operators now differentiate through service quality, corporate partnerships, or personalised travel design.

What to Check:

• Market concentration – The industry remains highly fragmented, with the top players accounting for less than 30% of total revenue.

• Major competitors – Key players include Flight Centre (10.5%), Booking.com (5%), and Expedia (4.3%), each leveraging online channels to expand reach.

• Location advantage – New South Wales, Victoria, and Queensland together host over 80% of all travel agencies, with Sydney, Melbourne, and Brisbane serving as major travel hubs.

• Brand and digital strength – Evaluate SEO visibility, client reviews, and CRM systems. Agencies that blend automation with human expertise have proven more resilient.

3. Is the Business Positioned for Emerging Travel Trends and Technology?

Why It Matters:

The industry is shifting towards automation, AI itinerary planning, and sustainability-driven tourism. Agencies that align with these developments will have the best long-term growth prospects.

What to Check:

• AI integration – Leading firms such as Expedia and Booking.com now use AI tools to customise travel recommendations, a capability consumers increasingly expect.

• Tourism growth outlook – International travel by Australians is forecast to grow 5.3% annually through 2031, driving strong demand for outbound travel services.

• Corporate travel – Businesses are returning to managed travel programs for efficiency, supporting steady demand despite economic fluctuations.

• Sustainability focus – Tour operators promoting eco-friendly experiences and responsible tourism are benefitting from changing traveller preferences.

Ready to Invest in a Thriving Travel Agency Business?

With tourism rebounding and consumer confidence improving, Australia’s travel sector presents new opportunities for investors who embrace digital transformation, personalised service, and sustainability.

By combining technology, trust, and tailored experiences, a modern travel agency can thrive even in a competitive online landscape.

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