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Opening a travel agency? Seeking ATAS accreditation is essential, but what's expected?


In this article we explain what is required of start-up businesses going through the ATAS application process.

As a start-up and looking to become accredited under the AFTA Travel Accreditation Scheme (ATAS) you must firstly satisfy the definition of a start-up as “a business in its first stage of its operation, and has either recently started trading or is about to commence trading”.

The ATAS application goes on to detail a number of other criteria which must be met in order to become national accredited; one of which is particular to start-up businesses and it is called Criteria 9. Sound ominous?
Criteria 9 requires the applicant to provide a business plan, a forecast budget, details on seed funding and borrowing capacity.

So let’s have a look at why these are necessary.


Firstly your business plan.

Every business, whether it be a start-up or long standing, be it small or large, has to operate against a plan to optimise it’s potential for success.

Now here comes the analogy, but it’s relevant to the business you’re considering.

When planning a holiday, you start off with an intended destination. You look at additional places you might like to visit and then build an itinerary. You determine how you’ll get there, where you’ll stay and eat. You’ll also look at the cost which can include plenty of unexpected expenses. The same principles apply to your business. You need to know where it is you are going, when you will arrive, how you intend to get there and what your going to do once you have arrived.

The elements of your business plan should be based around Management, Marketing and Finance. It will assist in setting direction and pace for the business and help you to identify your intended strategic advantage – what will make you better than your competition and selling that strength to the marketplace. Identifying where you fit in the market place is integral in determining your business outcomes.


Now let’s have a look at the money side.

For a start-up business you are essentially doing lots of estimates. You won’t know exactly what your expenses or your income will be, but through some careful estimation you can arrive at a pretty good understanding. Looking from the perspectives outlined in your business plan is critical when identifying the costs associated with implementing your desired business model and keeping it running once established. The critical period for determining the potential success of a business will be your first 12 months in operation, so a forecast budget of 12 months is pretty important.

Once you have identified those business expenses you will have an idea of how much capital needs to be invested in your business to cover start-up expenses and ongoing costs. Most businesses take a while to get off the ground, so you should look at being able to cover the costs associated with running your business with your initial capital for six months.

It’s better to over-estimate your expenses so you don’t under-estimate your seed funding.


The next thing you have to consider is your income.

Being realistic, anyone who is looking at starting a business is doing it for the purpose of generating a profit. While this can be a difficult thing to achieve in the first year of operation, if you have planned carefully you won’t have too long to wait. It is important however to set intended milestones to determine how well your business is performing against expectations and whether the business’ income is going to be adequate given the expenses you have already estimated.

If you have set a goal of how many customers you will sell to at the 6 and 12 month mark and know the margin on those sales you should be able to closely estimate your income. If your sales end up meeting your expectation, fantastic. If not, you will need to look at why those goals weren’t met and do a new round of estimates to determine the viability of your business.

The bigger picture is a business armed with a dynamic business plan supported by solid forecasts with systems in place to review actual results. This will ensure your business is well positioned for long term success.
While criteria 9 may sound ominous, it is in fact just good business practice.

There are DFK ANZ accountants and business advisors right across Australia who can help you to create and track the effectiveness of your financial business plan. Call 1300 DFK ANZ to book. AFTA Members receive a complimentary Strategic Business Review.


DFK Michael Grey

Michael Gray – CA,BEc,Dip CM,CP Mgr,FAIM,AIMC,ACSA,ACIS,JP

Michael has extensive experience in the production of business plans, preparation of the financial components of business plans, monitoring actual results to budget and directing business towards change and capitalising on their strengths.

He has lectured extensively to small business and is a registered consultant with the Institute of Management Consultants. mgray@dfkadel.com.