The tourism industry is soaring. Why do travel agencies see only crowds of people but no money?

Looking at the business structure of each company, the sectors with higher gross profits are basically sectors other than travel services. For example, China Youth Travel Service, which made a net profit of 347 million yuan in the first half of the year, has a gross profit margin of over 80% in hotel and scenic area operations. The gross profit margin of travel agency services is only 8.4%. The same is true in Zhangjiajie. The gross profit margin of scenic spots, environmentally friendly passenger transport and even sightseeing trams has reached about 50%, while the gross profit margin of travel agency services is only 5.9%.

Looking at the development of the tourism industry, the tourism industry still needs to improve its cost control. The annual turnover of many domestic tourism companies is calculated in 100 million yuan, but their cost expenditures are also similar, resulting in a profit margin of only about 5%. For the current tourism industry, it is not easy to increase unit prices or seize a higher market share. Therefore, cost control will become one of the main ways to make profits in the tourism industry.

Usually the cost of a travel agency consists of operating costs, operating expenses, management expenses and financial expenses. Without weakening marketing expenses, enterprise operations and management can be optimized through flexible cost budget indicators, the introduction of advanced cost management systems, and the cultivation of cost and expense control awareness among all employees. From a development perspective, if travel agencies want to change the dilemma of increasing revenue without increasing profits, they must not only balance the relationship between revenue and cost, but also refine the design of tourism products. On the one hand, if the self-built facilities of travel agencies can meet tourists' needs for entertainment, accommodation, transportation, food, etc., then the derived consumption generated can bring more profits. On the other hand, travel agencies need to transform and expand new businesses, use their own advantages and resources to create differentiated products, and form combination products to attract high-end consumers.