Markup (Travel Agency)
Definition: A markup is an amount or percentage a seller adds to a net price to set the selling price.
How markup works
A travel agency buys at its cost and sells at its price. The markup is the gap. It can be a fixed amount per booking (for example USD 15 per ticket) or a percentage of the cost (for example 8%).
- Selling price = cost + markup
- Markup % = markup ÷ cost × 100
- Margin % = markup ÷ selling price × 100
Markup and margin are not the same number. A 10% markup on cost gives a margin of about 9.1% of the selling price.
Fixed amount or percentage?
| Fixed amount | Percentage | |
|---|---|---|
| Easy to explain | Yes | Less so |
| Fair on cheap tickets | Can look high | Small in money terms |
| Fair on expensive tickets | Can be too low | Grows with the price |
Many agencies combine them: a percentage with a minimum amount per ticket.
Why it matters for travel agencies
Your markup has to cover more than profit: staff time, payment fees, the cost of handling changes and refunds, and currency differences if you buy in one currency and sell in another. Work out your costs first, then set the markup.
Example
Hypothetical: the full cost of a ticket is USD 400. The agency adds 8% (USD 32), with a minimum of USD 25. The customer pays USD 432. The margin is USD 32, or about 7.4% of the selling price.
How QuickOTA handles markup
In the QuickOTA B2B Panel you see the fare and an itemised service fee before you book, then set your own markup when you sell to your customer.