Machu Picchu, Peru: Lee Otis (flickr)
Every year millions of people across the world book tours to famous travel destinations such as The Great Wall of China, The Pyramids of Egypt, and the Galapagos Islands. If you are a budget conscious traveler, you will likely make these tour arrangements on your own (as opposed to using a travel agent). So, you have a choice to make. Do you book with a well-known international operator or do you book with a local tour provider?

Always book locally:

In my opinion, you should always try to book your tour with a local operator. First of all, it is much more responsible to invest your money directly into local businesses and operators who can use it to further develop their travel infrastructure and quality of life. Second, it is significantly less expensive to book a tour with local operator than an international one, as the international operator is almost guaranteed to charge you for numerous unneeded services that usually double, triple, or even quadruple the total cost of the tour.

Let me provide an example by analyzing the cost of booking a tour across the Inca Trail to Machu Picchu in Peru. I’ll compare the tour cost between a well-known and “reasonably” priced international operator - Adventure Life, and local operator in Peru - Peru Treks and Adventure.

International vs. Local Operator Price Analysis:

The following links will take you to the two itineraries offered by Adventure Life Inca Trail Hike and Peru Treks and Adventure Inca Trail Hike.

At first glance you will see the the Adventure Life tour costs $1775, while the Peru Treks and Adventure tour costs $390. Obviously this is a large price disparity, however, you will probably also notice that the Adventure Life tour is a 10 day tour, while the Peru Treks and Adventure tour is only 4 days. The Inca Trail hike itself only runs for 4 days on both tours, the difference is that the Adventure Life tour includes a few days spent in Lima and Cusco, Peru in addition to the time spent on the Inca Trail. So, the big question is, are those 6 extra days really worth the additional $1385 that Adventure Life charges for the tour? Let’s see:

I will now analyze the entire Adventure Life itinerary and break down costs per day so that we can see if it’s a good deal or not:

• Day 1: Arrive in Lima - All you do on this day is arrive in Lima, Peru, and head to your hotel for the night. You stay in Hotel Carmel in Lima, which costs $60 for a double room or $30/person. No meals are included.
• Day 2: Fly to Cusco - Wake up and hop on a plane to Cusco, Peru. Spend the day looking around Cusco, things you could do on your own. Night in Hotel El Balcon, $60 for a double room, or $30/person. No meals are included.
• Day 3: Free day in Cusco - Another day on your own in Cusco. You can take advantage of a day excursion, however the cost is extra. Night in Hotel El Balcon, $60 for a double room, or $30/person. No meals are included.
• Day 4: Sacred Valley of the Incas - This day you do something different. Head to the Sacred Valley of the Incas, visiting ancient villages and ruins. Night in El Sauce, $79 for a double room, or $39.50/person. No meals are included
• Day 5-8: Hike the Inca Trail - Hike the Inca Trail. I will value this at $390/person the price charged by Peru Treks and Adventure with all amenities included.
• Day 8: Night in Machu Picchu - Night spent in the Machu Picchu Inn, a nice hotel running $125 for a double, or $62.50/person.
• Day 9: Head back to Cusco - No activities other than transport back to Cusco. Night in Hotel El Balcon, $60 for a double, or $30/person No meals included.
• Day 10: Fly to Lima, return home - This day simply involves flying back to Lima, then flying home. No activities, hotels, or meals included.
• Total Cost: $612.00 USD

Conclusion:

Basically, you could independently follow the exact same Adventure Life itinerary, stay in the same hotels, and visit the same places for roughly $612.

So, does this mean that Adventure Life simply pockets the other $1183 they charge for this tour? No it doesn’t.

A sizable percentage goes to what I like to call the “hold your hand” fee. The one thing that you get with an operator like Adventure Life that you won’t get with a local operator like Peru Treks and Adventure is someone to hold your hand from start to finish. Adventure Life will have people waiting for you at the airport in Lima, and that will accompany you throughout your tour until you arrive at the Lima Airport again 10 days later to go home.

The big question is how much is the “hold your hand” fee worth to you? Some travelers are more than willing to pay $1000+ for someone to make sure they get everywhere they need to go, that everything in properly organized, etc. However, many others, including most budget travelers, consider this a waste of money, and would honestly prefer the adventure of doing all the “in-between” work on our own. That’s why for the budget traveler, I recommend avoiding international “hold your hand” operators as much as possible. The majority of the services they provide are completely unnecessary, and they will charge you an arm and a leg for them.

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