Fixed-fee valuations of retail, corporate and wholesale travel agencies.

A travel agency is valued on the maintainable profit from the income it keeps, such as booking income, supplier income, override income and service fees, never on the total value of travel sold, which is mostly the clients' money. Corporate contracts, the durability of supplier and network arrangements, the trading years chosen as representative, and how client money is held all move the value. Agency Valuations prepares an independent written report at a fixed fee: $1,495 + GST for agencies turning over under $2 million, delivered in 2 business days.

How is a travel agency valued?

We value most travel agencies on capitalised maintainable earnings. Total transaction value is a sales measure, not income: almost all of it belongs to clients and passes to airlines, hotels, cruise lines and tour operators. The valuation starts from the income the agency keeps and the profit it produces, with the owner's pay reset to a market wage and one-off items removed.

Choosing the years matters more in travel than in most industries. Trading through the pandemic years and the rebound that followed can each distort an average, so we look at enough history, by month where it exists, to see a representative pattern, and the report says which years were used and why.

Which travel income is worth the most?

Each income stream is tested on how likely it is to continue under a new owner:

• ·Corporate management and transaction fees: the closest thing travel has to recurring income, valued on contract term, tender dates, client concentration and how embedded the agency's booking tools and reporting are.
• ·Service fees charged to clients: within the agency's own control, and a sign of pricing strength.
• ·Booking income on leisure travel: valued on repeat clients and on whether those clients belong to the agency or follow individual consultants.
• ·Supplier income and override income: volume-based payments from airlines, cruise lines and wholesalers, often reset each year. They are valued on their contracted durability, not on the latest year's figure.
• ·Wholesale margin: the margin on packaged product, with currency risk and supplier prepayments taken into account.
• ·Groups and cruise: deposits taken well ahead give visibility of future income, along with an obligation to deliver.

Do network and supplier agreements transfer on a sale?

Where an agency belongs to a network, franchise or buying group, some of its override and preferred supplier income may be negotiated by that group rather than by the agency. That income follows the membership, so the membership agreement is read as closely as any lease: joining and marketing fees, volume commitments, branding obligations, and any change-of-control or assignment clauses that need consent before a sale.

Benefits are netted against obligations. An agency that earns strong override income but depends on one network's consent to sell is worth less than its headline numbers suggest. Whether a particular agreement can be assigned is a legal question for your lawyer; the valuation prices the risk.

How are client money, deposits and refunds treated?

Travel agencies hold client money between booking and paying suppliers, so the bank balance overstates the cash the owner could take out. We separate that float from genuinely surplus cash before any value is added for cash.

Forward bookings and deposits are evidence of future income and also an obligation to deliver. Outstanding travel credits, refunds owed and chargeback exposure are liabilities, and on a share sale they stay with the company. The valuation sets them out so a buyer and seller can see what is being taken on.

What about accreditation and key consultants?

Many agencies hold accreditation with the Australian Travel Industry Association (ATIA), the industry body's accreditation scheme. ATIA says public liability and professional indemnity insurance are mandatory for accreditation, and it publishes a list of cancelled or withdrawn accredited participants. We record the agency's accreditation status, insurance and any airline ticketing arrangements, because suppliers, networks and corporate clients may look for them.

People matter as much as paperwork. Leisure clients often book with a consultant, not a brand. Where consultants work from home or as contractors under a host agency, their agreements decide who controls the client list, and that decides how much of the income a buyer can keep.

When do travel agency owners need a valuation?

• ·Selling the agency, or testing an offer from a network, a group or a rival agency.
• ·Buying an agency or a corporate client book.
• ·A partner or shareholder exit under your shareholders agreement.
• ·Equity for senior consultants or managers, where shares or options need a market value under the employee share scheme rules.
• ·Restructures and related-party transfers, where tax law looks to market value.
• ·Small business CGT concessions, where market value is needed for the asset threshold tests.
• ·CGT reform: from 1 July 2027 the 50% CGT discount for individuals, trusts and partnerships is replaced by cost base indexation and a 30% minimum tax for gains accruing after that date, so a valuation at 30 June 2027 may be useful.
• ·A dispute between owners, where an expert report is needed.

What do we need from you?

• ·Financial statements for at least three years and year-to-date management accounts, with monthly figures where you have them.
• ·Income split by stream (corporate fees, service fees, booking income, supplier and override income, wholesale margin) and by segment.
• ·Corporate client contracts with fee schedules, terms and tender dates.
• ·Your network, franchise or buying group agreement, and any override or preferred supplier agreements.
• ·Client money reconciliations, forward deposits, and outstanding credits and refunds.
• ·Accreditation and insurance certificates, and consultant agreements.
• ·Owner salaries, personal costs run through the business, and your shareholders agreement.

How much does a travel agency valuation cost?

Fees are fixed and set by your agency's annual revenue as shown in its financial statements, excluding GST. For a travel agency that acts as agent, that is the agency's own income, not the total value of bookings passing through to suppliers. A Small Business Valuation is $1,495 + GST for turnover under $2 million, delivered in 2 business days. A Medium Business Valuation is $2,495 + GST for $2 million to $3 million, and a Large Business Valuation is $3,495 + GST for over $3 million to $10 million, each delivered in 3 business days. Above $10 million the fee is quoted in writing before work starts, with the delivery date agreed before commencement. An expert report for a dispute or court is $4,495 + GST, with the delivery date agreed before commencement. Each extra past valuation date is $495 and each additional entity is $795. Delivery time starts once payment and all required information have been received.

Every report follows the guidelines of APES 225 Valuation Services and is signed by a suitably qualified business valuer. We value agencies; we do not broker or sell them.