10 Essential KPIs to Understand an Agency in 5 Seconds

We live drowning in data. An average travel agency generates thousands of daily records: GDS bookings, bank transactions, emails, website visits, and ERP invoices. The problem isn't the lack of information, but the "noise." As a manager or owner, you don't need to see every ticket issued; you need a dashboard that tells you if the ship is heading to port or towards the rocks. Here are the 10 Key Performance Indicators (KPIs) that truly matter to diagnose your business health at a glance.

1. Real Gross Margin (Not Just Total Sales)

"Turnover" is vanity; "margin" is sanity. Many agencies celebrate large sales volumes with tiny margins. The KPI must reflect the net margin after deducting direct costs, incentives, and ceded commissions. Seeing this number in green or red is the first reality filter.

2. Conversion Rate (Look-to-Book)

How many quotes or inquiries turn into a firm sale? A low rate can indicate out-of-market prices, slow response times, or a sales team needing training. Monitoring this weekly allows you to detect product or personnel issues quickly.

3. Revenue Per Agent (Revenue Per Employee)

Not to pressure, but to understand productivity. If there are large disparities between agents with similar roles, maybe there is a tool, process, or training problem. This KPI helps size teams correctly.

4. Customer Acquisition Cost (CAC)

How much does it cost you to get a new client through the door (or website)? If you spend more on marketing and commissions than the client leaves you in margin on their first purchase, you have a problem unless you have a strong retention strategy.

5. Customer Lifetime Value (CLV)

The counterpoint to CAC. A corporate client who repeats every month for 5 years is worth much more than a one-time vacation client, even if the first sale is smaller. Segmenting the portfolio by CLV allows you to know who to treat with a red carpet.

6. Supplier Mix (Risk Concentration)

Are you selling 80% with a single tour operator or chain? This risk KPI warns you of dependency. Diversifying is key to not suffer if a supplier goes bankrupt or changes conditions.

7. Average Incident Resolution Time

In Travel, problems (cancelled flights, overbooking) are inevitable. Quality is measured by resolution speed. A low time here is the best predictor of future loyalty.

8. Online Adoption Rate (for Corporate)

If you have self-booking tools (SBT) for corporate clients, what % of bookings do they make themselves? Increasing this KPI reduces your operational load and improves account profitability.

9. Operating Cash Flow (Days of Cash on Hand)

You can be profitable and go bankrupt due to lack of liquidity. Knowing how many days of cash you have available to cover operations without new income is vital to sleep peacefully, especially in a sector with credit payments (BSP, suppliers).

10. Net Promoter Score (NPS)

The golden question: "Would you recommend our agency to a friend?". A simple number that summarizes brand perception and the health of the relationship with the market.

Conclusion: Less is More

Don't try to measure everything tomorrow. Start with 3 or 4 of these KPIs, automate their collection (forget about manual Excels every Friday) and put them on a visible dashboard. Data is only useful when it generates actions; if a KPI doesn't make you change any decision, remove it from the board.