“Resellers are too expensive”. It’s a phrase we hear from some operators. However, while some operators shy away from resellers because of the commission, other tour operators believe that resellers are a great way to quickly grow your business.

So, why use resellers?

We spoke to two tour operators who have used resellers extensively about their experience working with resellers.

Firstly, both agreed that tour operators should not be too reliant on any single reseller. Instead, focus on building a diverse distribution channel consisting of multiple types of resellers in addition to your direct bookings. This’ll allow you to capitalize on all the benefits of working with resellers without any risks.

With that in mind, they shared:

4 reasons to work with resellers or distribution partners

1) It’s like putting your business on autopilot

“My top 10 travel partners did $1m a year in bookings. It takes time and tenacity to build those relationships, but once you do, it feels like your business is on autopilot. It’s like having a guaranteed $1m in sales that you don’t have to think about.” – Josh Oakes, owner @ The Sunshine Tribe.

Once you’ve found the right resellers and partnered with them, the bookings will start coming in automatically. This number increases with each reseller you bring on, which will save you a lot of time in the long run. This will give you more time to focus on your business, whether it’s improving your products, expanding your product range, hiring or even further building your own direct booking channels.

2) You get the exposure that you may not otherwise have access to

“GetYourGuide and Klook have been great from a booking and marketing point of view. We’ve been included on photoshoots and video shoots with Tourism Australia, they’ve given us great exposure we wouldn’t have got otherwise.” – Will Andrew, owner of Graze and Gaze.

Through working with GetYourGuide and Klook, Graze and Gaze was included on photo and video shoots with Tourism Australia and were later featured on newspapers and tv channels.

They also benefit from Red Balloon who invests heavily in marketing for them. “Everytime I google, I see their ads coming up for my product.” – Will Andrew, owner of Graze and Gaze.

Large resellers like OTAs benefit from economies of scale and have the ability to run larger campaigns that you may not normally have access to. By building a good relationship with them, you can benefit from these campaigns.

Similarly, other resellers such as accommodations can get you exposure to those last-minute travelers who are already in destination and looking for something to do.

Each reseller has its own unique audience that may be difficult for you to target. Building out a distribution strategy with diverse resellers will help maximize your exposure to travelers.

3) Direct bookings are costing you money too

Why use resellers

“Reseller bookings will cost you commission but direct sales are costing you money too, think advertising costs, website management, marketing agencies, etc.

However, with resellers you only pay the commission when a sale is generated. Anyone who wants to build a fast-growing business needs to build out a diverse sales channel. The resellers are people out there doing the work for you and you only pay them when they make the sale.” – Josh Oakes, owner @ The Sunshine Tribe.

While it’s true that you need to pay commission for reseller bookings, you also need to pay costs associated with direct bookings. Unless you’re ranked number 1 on Google and are getting all your bookings through organic SEO, you’ll likely be paying for advertising. Some operators may even be paying someone to manage the advertising strategy.

“Try to work out your commission against your direct booking cost. The commission may be a little higher but I’d rather have a little less margin than nothing at all. Especially for operators who run group tours, if you’re selling seats on a bus, you want that bus to be full.”- Will Andrew, owner of Graze and Gaze.

Check out this article for a full cost comparison.

4) There are no commitments, you’re not locked into anything

Why use resellers

There are no commitments when working with resellers. You only pay the reseller when you receive a booking (unlike with other marketing channels), and you can stop working with the reseller anytime. “In fact, you can turn agents on and off or edit your availabilities, so you can leave popular times reserved for direct bookings.” – Will Andrew, owner of Graze and Gaze.

Resellers don’t come with lock-in contracts, so there are no risks involved when working with resellers. You can try working with a few, if they work, great! And if they aren’t for you, you can stop anytime.

The bottom line

When used correctly, resellers are a great risk-free way to quickly and efficiently grow your business. The key is to build a diverse sales channel by partnering with multiple different resellers in addition to your direct booking channels.

That’ll ensure that you don’t lose out on any of your direct bookings while maximizing your exposure and your bookings through other channels.

Closing Links

You can find Will at:

https://instagram.com/grazeandgazesydney

https://www.linkedin.com/in/wandrew

Josh Oakes is offering:

A free 45 minute ‘Tour Business Breakthrough Session’ to a limited number of tour operators. On that call, Josh is going to figure out what’s not working for you in your business right now. Then he’s going to lay out a simple, clear and actionable plan to take your tour biz from where it is right now – and transform it into an efficient, streamlined, scalable (and highly profitable) ‘asset’.

Josh took his own tour business (Melbourne Private Tours) from zero to $2.5 million in annual revenue in just a few years before selling the business in late 2017 for 7 figures. Since then he’s helped hundreds of other tour businesses scale, even in the most challenging of environments. You can apply here for your Free Breakthrough Session

 

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