BUSINESS: Travel agency

Company: Haixin Travel Agency

Interviewee: Gabriel Sun

Age: 23

Business started from: Last December

Initial investment: It cost between 5,000 yuan (US$732) and 6,000 yuan to find and equip an office and hire a few start-up staff. And Sun is still investing up to 3,000 yuan a month into his business from his own pocket.

Future expectation: To give full dimension to online services, handling inquiries, bookings, payments, customer databases and feedback surveys

Editor's Note:

Shanghai's strong economic growth should be attributed to not only the robust performance of state-owned enterprises but also the emerging power of the private sector. The number of private businesses now account for 72 percent of the total in the city, according to the local statistics bureau. Shanghai Daily has launched a biweekly column about small business people in Shanghai and how they cope with the challenges of entrepreneurship.

Gabriel Sun bustles breathlessly around his office on the fringe of downtown Shanghai, answering phones, checking his computer and pulling faxes off a machine. As a Lunar New Year begins, the 23-year-old entrepreneur is grabbing the tiger by the tail.

Sun, fulfilling a dream he has long nurtured, invested his savings to open his own travel agency in December, hoping to profit from the wanderlust stirred by rising urban incomes in China.

"Among my friends, I'm the only one who had a passion to start up my own business," said the college graduate and former white-collar worker. "Since I was a child, I knew I would be different. I'm not an ordinary person satisfied with a routine 9-5 job working for someone else the rest of my life."

China's tourism slumped after the world financial crisis, but the industry is recovering amid escalating economic growth and the effects of this year's World Expo in Shanghai. The industry's revenues are forecast to grow 13 percent to 1.4 trillion yuan (US$205 billion) this year.

"I began to think like a real leader."

Sun's decision to start a travel business wasn't based on just the rosy outlook for tourism in China. It was a step-by-step process that ushered him to the front door of Haixin Travel Agency on Zhongxing Road in Shanghai's Zhabei District.

He began seriously thinking about his venture when he was a student at Shanghai Normal University, studying in the College of Tourism. During that time, he worked part-time jobs and spent his earnings on plane tickets and backpacking trips off the beaten track.

He explored local cultures and found them more captivating than routine tourist attractions. He thought about what motivates people to travel and what kinds of assistance they might need to make their trips more fulfilling.

But passion was far from enough.

By a stroke of luck, Sun met a like-minded young lady named Zhang Shujia, who was putting together a project to enter the TV reality show "Winner." The project proposed setting up a business selling Chinese traditional products to the tourism industry. Sun joined the project team, learning the nuts and bolts of building a business from the ground up. The project won the first prize of 1 million yuan (US$146,480) for its innovation.

"That experience reoriented my way of thinking about entrepreneurship," Sun said. "I began to think like a real leader."

To break into the industry without breaking the bank

At the time he was working as a research supervisor. He was a young man with big ideas, little experience and limited capital. But he was determined to take a risk and start his own travel agency.

First Sun had to figure out a way to break into the industry without breaking the bank.

Last September he got in touch with Shanghai-based Haixin Travel Agency Group, which was established in 1996 and had 20 branches. Opening a branch under an existing franchise name avoided hefty registration costs and put some experienced resources at his disposal.

"To start, I invested my own savings and part of my parents' savings," Sun said.

It cost between 5,000 yuan (US$732) and 6,000 yuan to find and equip an office and hire a few start-up staff. In December, the doors opened for business.

The business received backup help from headquarters on marketing strategy, travel routes and even a customer base. But Sun was determined to go beyond that framework to put his own ingenuity to work and create a more innovative business.

Haixin spends more than 1 million yuan a year advertising in print media and on popular travel Websites. It targets the middle-aged and retirees, offering low prices.

Older travelers are indeed a stable base, but it's the young crowd where tourism has its biggest potential, Sun realized. He is trying to expand the market and diversify the pool of customers.

"Now we are cooperating with some Websites aimed at college students and offering them interesting travel plans at affordable rates," Sun said. "Those Websites have a user's attention for four college years. We see it as an opportunity to increase our customer base for much longer."

How much market share is left for Sun?

The young are a tricky class to attract. They are among China's most enthusiastic travelers, but they are also computer savvy and know where to look to organize their own customized backpacking trips or self-drive tours. Self-help travel Websites, such as Ctrip, Elong and Mangocity, are well established and popular.

Independent travel is a booming sector in the industry, according to the Blue Book for China Tourism published on January 7. Independent travel accounted for about 70 percent of tourism last year, compared with just 20 percent a few years back.

"As a customer, do you think these travel Websites offer the lowest prices?" Sun asked. "If you come to our office and take a look at our prices, you wouldn't think that any more."

Most travel Websites, he pointed out, offer plane tickets and hotel booking services. An online service platform attached to a full-service travel agency like his can also provide travel itineraries, routes tailored to personal preferences or special niche group tours. It can add the personal touch to trip planning.

"The problem is that Websites of most travel agencies are not well managed," Sun said. "Once we invest more in our Website constructions, we will pose a competitive threat to the popular self-help sites."

His ideas have caught the attention of Haixin. In addition to managing his own branch, Sun has also taken on the role as director of information technology for the entire company.

His goal is to give full dimension to online services, handling inquiries, bookings, payments, customer databases and feedback surveys.

With World Expo set to open in Shanghai on May 1, Sun's agency is now offering theme tours of the site.

He is still investing up to 3,000 yuan (US$439) a month into his business from his own pocket, but he's not discouraged.

"This is my dream, and I take full responsibility for it," he said. "Regrets? I have none."