Basic accounting translates to….Revenue, less expenses = profits.
That’s the equation. Simple enough. And when the sum of your expenses exceeds the sum of your revenue, let’s just say you don’t have to have a fancy ivy league CPA certification to know that ain’t good.
The problem is… for most, embarking on an entrepreneurial journey doesn’t come with wads of cash. Yet at every turn, we have people with outstretched palms sending us invoices. From software subscriptions to memberships to basic Wi-Fi…there isn’t a lot that comes free in this world – apparently not even lunch.
And what’s worse, if you’ve ever enrolled in a game of Compareschlager, you’ll note your good friend down the street who also sells travel, just bought a brand new Tesla. And while you are sitting at your desk, busy moving money from one account to another trying to make it all work, you look out your window only to see she’s just added the entire inflatable reindeer collection to her front lawn. You think…How the F* can she afford that?!? What secrets does she know that I don’t?
Why can’t I afford that? 😫
Building a profitable travel business is something that does not happen overnight. It takes time. It takes time for a gazillion reasons, but the top three are:
- Travel agents generally don’t get paid until a client travels which can be a full year in the future.
- Commissions keep getting cut from every angle.
- Let’s not forget the global pandemic with a good portion of our population unvaccinated, so can’t travel, or vaccinated but too afraid to travel. And if it isn’t a pandemic, there is an earthquake or snow storm or you can insert the malady du jour.
It’s no surprise you aren’t flying private, have an island to yourself in the Caribbean and aren’t posting Tik Tok videos rolling around with Juice Wrld on a bed of green.
And while all the experts, including yours truly, are saying…be patient. It’s coming.
Last I heard, Bell Mobility isn’t accepting IOUs on hand-written stickies. Just sayin’
But here is the good news…
The entrepreneurs who start off with little money and have the patience to grow slowly, have longer sustained success over time. (Of course, some exceptions apply, Mr. Unicorn Bezos)
You’ve probably watched an episode or two of Shark Tank. The sharks have often said that entrepreneurs with tons of money and little patience tend to crash and burn because…as soon as they are confronted with an obstacle, they throw money at it.
After all…money solves a lot of problems.
But here’s the rub…in many cases, expenses and problem-solving can quickly outpace revenue.
So let’s take Becky who has inherited a sizeable chunk of wealth from her favourite Aunt Millie. Becky wants to start a travel business but Becky doesn’t know the first thing about building a profitable travel business. She just really loves sitting on the beach in Cabo and has read one too many platitudes that scream….do what you love and you’ll never work a day in your life.
So she takes Aunt Millie’s money, and she’s off.
She hires a web designer, a copywriter, a social media content manager, a bookkeeper, a Facebook Ads manager, and a graphic designer.
Everything seems to be going well for a while until her web designer develops a crack habit. Becky’s site goes offline, and she finds herself at the mercy of trying to find someone else who can step in just to get her through the day.
Becky is SOL.
When you start out slow, with shallow pockets, you have little choice but to be patient and to be resourceful. You have to learn WordPress 101 or something like it. And there is nobody but you to map out your sales funnel. And while you’d love to palm off your social media content creation to your teenager, who seems to be a wiz on the platform, you quickly learn that you get what you pay for.
So don’t be too upset that your Aunt Millie passed and didn’t leave you a hefty inheritance. Plus, everyone loves a tale of “rags to riches”. It makes for a way more interesting origin story that helps in creating your brand.
Remember Sara Blakely, who took 5K out of her personal savings, cut off the soles of her panty-hose and created Spanx which ultimately launched her to fame as the youngest self-made female billionaire in the world. It wouldn’t have sounded quite as catchy had she said…
“Oh, I inherited millions from my dear aunt Millie and turned that into more millions. Zzzzz 🤭”
Now please don’t mistake me. If you think I am saying that you have to do everything yourself, I’m not. In fact, I think outsourcing is a beautiful thing. AND I think
As most successful entrepreneurs will tell you….you can always get more money but you can’t get more time. As soon as you can afford to properly outsource, you should.
I’m simply suggesting that it behooves you to understand the basic concepts of running your business before you start delegating those tasks.
So that brings me to…what do you spend your money on first?
What to invest in first when you have limited start-up money.
I did say “limited” not non-existent. Every business needs a little bit of seed money to get going. The travel business is no different, but you can DIY until you start making money to support your business.
The 6 essentials* to building a travel business
A website builds credibility. I also like to think of it as a net for all your marketing efforts. As you journey to find clients, you need a place to put them when you get them. A website works for you while you sleep. You definitely don’t need an expensive website to start with. In fact, there are free website builders on the market. As long as your website has the functionality to take a visitor’s email address, then it’s enough to get you started.
If I had to put hard dollars down on only one thing, getting a solid website would be my choice. It’s the foundation on which you’ll build your business so while you can do it for nothing, if you can…invest in this first.
2. An email service provider
You can read, What You Need to Know Before Choosing an Email Service Provider, but don’t overthink it. Most of them offer a free version in hopes that you won’t bother switching once you get more subscribers. And sure, the free versions don’t come with heated seats and sunroofs but they have enough to get you started.
3. A graphics creator
Canva offers a free version. It’s important that you start building your brand and visibility so you need something that will help you do that. You can also schedule your social media through Canva as well which is a plus. Using Canva, you can create your own business cards, ads, flyers…everything.
Next to having a website, I’d put aside a certain amount of money each month for networking. It can be whatever amount you are comfortable with but you do need to invest something. This could be membership fees for networking events, either the ones you join or ones you create. It could be money to pay for parking or to buy a client a coffee.
5. A host agency
You can certainly buy yourself a franchise and have much of the marketing of your business baked in but this is my least favourite option.
Becoming an independent consultant is costly and I wouldn’t recommend that direction until you are making your first 100K.
So signing on with a host agency is the better option. Have a read through Choosing the Best Host Agency for Your Travel Business. A good host agency will handle your accounting back-end – for a fee…of course. But well worth the admin charges.
Continually Investing in both your product knowledge and sales and marketing knowledge is crucial to your success. Luckily, most suppliers offer free product training. But don’t let it end there. Be sure to add podcasts, blog posts like this one, and books from the library to your daily routine to hone your skills.
The Travelpreneur Mastercourse launches soon. Save your spot if you want a step-by-step blueprint to follow to help you get a steady flow of quality leads to your business. I can appreciate this might sound self-serving but I am dedicated to getting you results. However if my style doesn’t match yours, there are other travel marketing experts you can choose. Just pick one and let them be your guide.
7. A coach
Yep, you heard me right. A coach. You might think that a coach is a luxury that you only hire once you’ve hit it big. I sheepishly thought that and how wrong I was.
This entrepreneurial journey is not for the faint-hearted. Read, Why It’s High Time to Invest in a Business Coach. There are days that it will be tough like a piece of biltong. A good coach brings out the best in you. They see things you can’t see for yourself. They challenge you. They support you. They are worth every penny when you see the actual results you get from hiring one.
It’s a mistake to think of them as a luxury.. All the best players have a coach that believed in them and demanded results when they felt like giving up. Because you will — feel like giving up on some days.
When you hire a great coach, you recoup your investment exponentially. I’d love the honour of being your coach. At time of writing, I am still taking one-on-one clients but I won’t be able to do that indefinitely as my time becomes more and more limited.
And if not me, just invest in someone but ultimately, it’s an investment in yourself.
And that’s it! That’s all you really need to get started on your path to having a wildly profitable travel business.
*Note: Of course, you need to invest in paper clips, Wifi, a smart-phone and a computer. But pens…never invest in pens. Always steal them. 😉
And double note: Notice that I didn’t say Facebook ads. Yes, they have their place but that’s for the next chapter. Stay tuned.
If you’d like the chance to work with me, let’s chat. Book a call below.Schedule Appointment