Profit First for DMCs: Stop Hoping for Margin, Start Designing It

In the world of DMCs, profitability often feels like an afterthought.

We sell. We operate. We pay suppliers.

And then… we check what’s left. If anything.

But what if profit didn’t come last?

The Classic Formula That Doesn’t Work for DMCs

Most of us were taught:

Revenue – Costs = Profit

In theory, it makes sense.

But in a DMC, reality looks more like:

• Client pays €5,000

• You build the trip

• You pay hotels, guides, transfers

• You adjust the program 5 times

• You chase a late payment

• You pay your team

• You pay your rent

• …and you hope there’s something left to pay yourself

The problem? You let operations define your profit — instead of the other way around.

Profit First: A Simple But Radical Shift

Profit First flips the formula:

Revenue – Profit = What You’re Allowed to Spend

That means:

• You decide your margin before starting the operations

• You adapt the trip to fit the margin, not the other way around

• You protect your business, your income, and your energy

It’s not just a financial mindset.

It’s a discipline that reshapes your business decisions.

How We Applied It at Mexikoo (my DMC)

When we first implemented Profit First at Mexikoo (our DMC in Mexico), we made one simple change:

We opened 4 separate bank accounts.

• 💰 Profit Account (10%)

• 👤 Owner’s Compensation (35%)

• 🏦 Taxes (15%)

• 🔧 Operations (40%)

Every time a client paid, the money (gross margin) was instantly split between those 4 accounts.

We only operated the trip from the 40% left in the Ops account.

Result?

Fewer over-generous upgrades.

Fewer “just this once” supplier exceptions.

More creativity. More clarity.

And real cash in the Profit account, not just a number on a spreadsheet.

🧠 The Toothpaste Tube Analogy

When your operations account is full, you don’t think too much.

You upgrade to that nicer lodge. You throw in the private transfer. You add a surprise.

But when the account is tight?

• You get creative

• You optimize

• You design within constraints

That’s when your business becomes resilient.

Where DMCs Really Lose Margin (Hint: It’s Not Just Suppliers)

The biggest leak in DMCs isn’t just overspending on hotels or transfers.

It’s invisible cost:

• Time wasted redoing quotes manually

• Sales-ops back-and-forth

• Manual confirmations and invoices

• Last-minute changes

You don’t see these in your P&L.

But they erode your margins every single day.

A Practical Exercise: Cut 10% in One Day

Here’s something we tried — and it worked:

Change the credit card linked to your recurring tools and subscriptions like magazines, or online services.

Then wait 30 days.

If no one complains → the tool probably wasn’t essential.

It’s a fast way to clean up your digital clutter.

And yes, this alone helped us cut 10% of our monthly spend without touching any suppliers.

📞 Another Simple Win: Renegotiate Your Supplier Costs

Another highly underrated lever?

Pick up the phone and call your suppliers — one by one.

Ask for:

• A loyalty discount

• A new rate for low season

• A better commission structure

• A group price for FITs (it works more often than you’d think)

It costs nothing to ask. And most DMCs discover that negotiating trims at least 5–10% off operational costs.

📍Start with your biggest fixed cost, for many, that’s rent.

It might feel non-negotiable, but we’ve seen DMCs get:

• 1–2 months rent-free in exchange for a longer lease

• Shared coworking deals with other local tourism actors

• Or even better terms by simply explaining their off-season cash flow constraints

What Odys Can Do to Help

At Odys, we’re not just building a CRM for DMCs.

We’re building tools that protect your time, your margins, and your sanity.

Here’s how:

• Track profit per trip, per client, and per source

• Reduce operational noise with automated follow-ups, invoicing, and trip confirmations

• Create clean, consistent quotations in minutes

• Sync payments, margins, and project statuses in one dashboard

• Minimize back-and-forth between teams with centralized notes and internal comments

And most importantly:

Odys helps you regain control over your operations, so profit doesn’t come last.

Final Question (for You)

If you paid yourself first, what operational decisions would suddenly become unacceptable?

That’s your compass.

Let it guide your next quotation, your next campaign, your next hiring plan.

Profit isn’t selfish.

It’s what allows you to keep delivering amazing trips, grow your team, and build a business that lasts.

Alexia

Co founder Odys