How to Start a Tour Operator BusinessNovember 21, 2016, Taylor Odgers
Starting a tour business is hard work. Like any other business, there are lots of pieces that need to come together before you find success. And with so many resources out there it can be hard to know where to begin. This post can be used as a blueprint as you go through the stages up until, and after, your first tour. It will help you focus on the tasks that will make the most impact.
Operating your own tour company can be a rewarding and profitable experience. But will take hard work, commitment, and a lot of passion. So are you ready?
Let’s dive in.
Choose a Niche
Find Your Passion
The first step to building a tour business is to know what you’re passionate about. This may sound corny but starting a business takes a lot of energy. On top of that tours are very repetitive. If you aren’t passionate, you’re going to get sick of telling the same stories three times a day. And your guest will notice. There’s nothing worse than listening to a guide that sounds bored. Take some time to figure out what’s going to excite you to wake up and share with others every morning.
For example, if you have a passion for hiking, you might consider starting an outdoor adventure company.
Evaluate Your City
Once you have your passion in mind, it’s time to take a look at your city. Is it a popular tourist destination? What are the trends? Is there anything that’s not being explored? While passion is key, it’s equally important that there’s an opportunity. Passion without opportunity is just a hobby. Check in with your local tourism board to see if they have any market research reports that outline the opportunities and challenges in the industry.
Identify Your Target Market
Now that you have innovative tourism ideas, you need to map out what your ideal customer looks like. Think about the types of people that will be attracted to your tour. Are they outdoorsy? Do they love food? Will they want to talk to locals? What’s going to excite them? Who your customer is will determine a lot of the decisions you make later. So take the time to get to know this person now.
Research Your Competitors
Having found your tour idea and evaluated the market in the previous section, you’re almost ready to register your business. But first, you’ll need to research your competition, so you know what you’re up against. What are they doing well? Where are their gaps? Find ways to differentiate and stand out.
Register Your Business
With your research complete, now is a good time to consider your options for registering your business. Go to your local tourism board and find out the requirements for starting a tour company in your area. Here are some of the legalities you might have to go through.
Name Your Business
The first thing you need to do is name your business. Your name will be used in all of your documentation. Make sure your name is both memorable and descriptive. And more importantly these days— if the domain is available. If your name checks all the boxes, go to your local Registrar of Companies to get it approved and then purchase your domain.
Register Your Business
Now that you have a name you’re ready to make things official by registering your business. There are different options for how you register— sole proprietorship, partnerships, corporations. Evaluate the pros and cons of each before you make your decision.
Get Your Business Licence and Permits
Once you’ve registered your business, you’ll need to get a local business license. Check in with your local municipality to do this. You might need to obtain additional permits and licensing based on where you are operating and if you have any vehicles.
Register as a Guide
If you are guiding, you might need to complete a course to become a licensed tourist guide. This allows you to take tourists around a designated geographical area. To find out if you need to register as a guide, check in with your local tourism board.
Open a Business Bank Account
Now that you have a business license the next things you’ll want to do is open a corporate bank account. This will help you keep track of all your expenses and revenue and make accounting a lot easier. Speaking of accounting, you might want to consider hiring an accountant or signing up for accounting software.
Purchase Liability Insurance
Protect your business, and yourself, by getting liability insurance. This ensures that your company cannot be held accountable for risks. Your insurance company can guide you on your coverage needs. Some commonly required in the tourism industry are Commercial General Liability (CGL), Property Insurance, and Accounts Receivable Insurance.
Design Your Tour
Write Your Business Plan
With all the legalities taken care of, it’s time to write your business plan. A business plan is a document that holds all of your ideas. It’s your roadmap that helps you determine how you’ll move forward. Include your company description, market analysis, partnership opportunities, and small business goals. Create a marketing plan, an operations plan, and a list of your products and services. Make financial projections and be sure you account for seasonality. It’s okay if you don’t have all the answers right away, but it’s good to know what to focus on as you grow.
Create Your Unique Selling Proposition
With your business plan in hand, it’s time to lock down your unique selling proposition. This explains what makes your tour better than the competition. It’s the benefit that travelers can only get by booking with you — like that you provide ethical travels & tours. You should be able to define this in one sentence.
Determine Your Tour Price
Now that you’ve evaluated your market and determined the value of your tour it’s time to choose what you will charge. While it’s important to consider your operating costs and market value, the main thing you need to figure out is what customers are willing to pay. Keep in mind seasonality, as well as prices for children and groups. And remember that you can always test until you find the perfect number.
Craft Your Story
Now comes the fun part—it’s time to create a compelling story for your tour. Make sure it has a definite beginning, middle, and end. Find themes that you can carry through the entire experience. A clear narrative makes your tour more memorable. The goal is to have your guests telling their friends all the neat things they learned in the weeks that follow.
Create A Logo
Once you’ve created a story for your tour, it’s time to design your brand around it. The first step is to create a logo. Your logo is the visual representation of your business. It will be used in all of your marketing collateral. Pick a simple design that plays into your niche and story. Check out more ideas for branding your business.
Build Your Website
You’re finally ready for creating an online presence for your business. This is how many travelers will find you when researching their trips. If you don’t know how to build a website you have a few options; you could hire a contractor, hire someone in-house, or use Checkfront’s code-free Site Builder. Whatever you choose, make sure your website’s optimized for bookings.
Sign Up For an Online Booking System
You don’t just want travelers to find you online; you want them to make, and pay, for reservations right on your website. To do this, you need an online booking system. Your booking system can also be used to process your in-person and over the phone reservations. Here are a few links that will help you find the platform that’s right for you.
- What is an Online Booking System?
- Why You Need An Online Booking System
- Try Checkfront’s Booking System Free for 21 days
Talk to Other Guides
When starting a business, many entrepreneurs think they need to do everything on their own. This can lead to loneliness and frustration. And you don’t have to do it alone. Many guides would be happy to share their knowledge with you. Go out and build relationships with other operators in your city, who aren’t directly your competitors. Then take a trip somewhere and talk to guides that have the same type of company you are starting. Make a list of everything you can image going wrong and ask them how they dealt with it. You’ll come away with a ton of valuable information and a new friend in your corner.
Find a mentor
Now that you’ve made a few friends, you should find someone to act as your mentor. This can be an experienced tour operator or someone in a completely different industry. The key is to find someone who inspires you, will be brutally honest with you and will hold you accountable. Whenever you question yourself, and it will happen many times, it’s good to have someone you trust to turn to for advice.
Get active in the local tourism community
Take any opportunity you have to build relationships with local business. While it’s difficult to walk into a room full of strangers and feel like an outsider, you won’t regret pushing yourself to do this. You’ll feel connected to people in the same boat as you and get a lot from the relationships you make. Just don’t forget to give back. Here are a few key relationships you should build locally:
- With your local council
- The tourist information office
- Hotel front desks and tour desks
Go to a seminar
When you start a business, you are constantly learning. You learn from your experiences, your failures, and the people around you. But don’t forget to take the opportunity to learn from locally hosted classes and seminars. Not only will it expand your network but you will come away with some new ideas and perspectives. If you walk away only learning one thing, it will be worth it.
Market Your Tour
Networking alone won’t bring people to the amazing tour you create. The “build it, and they will come mantra” doesn’t work anymore. You’ll have to work for your first customers. Here are the channels you should zero in on.
List your tours on OTAs
Make it easy for travelers to find you by listing your tour on online travel agents (OTAs). OTA’s like Viator, Expedia Local Expert, and GetYourGuide already have experience in digital advertising and have built up a mass following. Yes, they’ll take a cut of your commissions (30-45%), but when you’re getting started, it may be worth it to get guests through your door.
Now that you’re tour is listed on a couple of OTAs it’s time to start driving traffic to your owned website. The best long-term strategy to do so is through search engine optimization (SEO). You can use SEO best practices to optimize your site for Google and other search engines. That way when someone searches for something related to your tour, your website shows up in search results.
While SEO is great, it takes time to crawl up the search rankings. To get immediate results you can buy AdWords. Instead of waiting for Google’s algorithm to show your website on the results page, you bid on keywords, so your site shows up on top of the page.
Start Email Marketing
Once you have people going to your website you’ll want to start building an email list. The list can be a combination of your customers and people who have subscribed through a form on your website. Send email newsletters and promotions to keep your list engaged and your business top of mind.
Get on Facebook
Connect with your guests and leads on Facebook. Create a Facebook page and post pictures of your tour. Use Messenger to answer people’s questions, and use Facebook’s ad network to help more people discover your tour. You can even add a “book now button” to your page to get bookings directly from Facebook.
Post Pictures on Instagram
Instagram and travel companies make the perfect pair. Travel shopping is a visual experience, and people go to Instagram to see beautiful pictures. Curate your feed with care and share images that will spark #wanderlust. Don’t forget to include a link to your website in your Instagram bio.
Use analytics to find out what’s working
When you first start advertising your tour, you’ll want to test many different channels. But after a while, you should zoom in on what’s performing best. Start using Google Analytics so you can track what sources are bringing the most traffic to your site, and the ones that get you the most paying customers. Then adjust your budgets to get the most of your ad dollars.
Launch Your Tour
Host Your Friends and Family
As you prepare for a successful business launch, you’ll want to do a few test runs. We recommend a pre-launch buzz campaign or hosting a few friends and family first. Think of it as your dress rehearsal. Go through the tour start to finish and collect as much feedback as you can. Once you feel confident that you’ve worked out the kinks, you’re ready to launch!
Building your own tour business is no easy feat. From designing a tour and evaluating your market, to building relationships, your brand, your online presence and getting those first customers through the door. There’s a lot of pieces to put together. However, following this guide, and your intuition, should provide you with a clear roadmap to help you build a successful tour operator business.
Just remember, once you launch your business the hard work begins, so you’ll need some time saving tricks.
P.S. Don’t forget to launch your tour business with a way for customers to book online.
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