Question 1

What's the difference between fixed and variable costs in this calculator?

Accepted Answer

Fixed costs (like transportation) don't change regardless of the number of guests. Variable costs (like entrance fees or per-person food costs) scale directly with your guest count. This tool simplifies by asking for total costs, but knowing the difference is key to advanced analysis.

Question 2

How does the break-even calculation work?

Accepted Answer

The break-even point tells you how many tickets you need to sell to cover your costs. It's calculated by dividing your fixed costs by the profit you make on each ticket (ticket price minus per-person variable costs). It's a crucial number for setting minimum tour sizes.

Question 3

What is a good profit margin for an excursion?

Accepted Answer

This varies widely based on the type of tour, location, and level of luxury. However, a healthy profit margin for many tour operators is typically between 20% and 30%. High-volume, low-cost tours might have lower margins, while private, high-end tours should have much higher ones.

Question 4

How can I increase the profitability of my excursions?

Accepted Answer

You have several levers: increase the ticket price, increase the number of guests (if costs don't scale 1:1), negotiate lower rates with suppliers (transport, attractions), or create tiered packages with high-margin add-ons like merchandise or premium experiences.

Question 5

Should I include my own salary in the 'Guide & Staff Costs'?

Accepted Answer

Yes, you should always pay yourself. If you are leading the tour, estimate what you would have to pay a qualified guide for the same work and include that in your costs. This ensures your business is truly profitable and not just subsidizing your own labor.

Excursion Profitability Tool

Results

Understanding Excursion Profitability

Frequently Asked Questions

Need Help Optimizing Your Hospitality Business?