Tour Operator Role in Tourism Industry

This assignment examines the significant role tour operators play within the travel and tourism sector. It analyzes how they contribute to efficient service delivery, economic development through foreign currency generation and job creation. The study also delves into marketing strategies employed by tour operators, such as online advertising and partnerships with local agents, to reach potential customers.

TOUR OPERATOR’S INDUSTRY
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Table of contents
Introduction......................................................................................................................................3
Task 1 (LO1)....................................................................................................................................3
P1.1 Analyze the effects of current and recent trends and developments on the tour operators
industry............................................................................................................................................3
Task 2 (LO2)....................................................................................................................................5
P2.1 Assessment of the stages and time scales involved in developing holiday packages.............5
P2.2 Evaluation of the suitability of different methods of contracting for different components of
the holiday and different types of tour operators 450......................................................................7
P2.3 Calculation of the selling price of a five days holiday packages............................................8
Task 3...............................................................................................................................................9
P3.1 The planning decisions for designing a brochure....................................................................9
P3.2 the alternatives of the traditional brochure which are using by the tour operators...............10
P 3.3 evaluating the suitability of various distribution methods that are used to sell holiday
package and recommending the most appropriate tour package...................................................11
Task 4.............................................................................................................................................13
4.1 Evaluating the strategic and tactical decision making for tour operators................................13
4.2 Comparing the tactical decision that a tour operator selects in different situations................13
Conclusion.....................................................................................................................................14
Reference list.................................................................................................................................15
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Introduction
The following study is about the tour operators industry associated with the travel and tourism
sector. The tour operator industry is the amalgamation of the various components of the tour and
travel sector. The main activities of the tour operator industry are to prepare different types of
brochure and advertisement for awarding the travelers and tourists about the different types of
products and holiday packages offered by the tour and travel sectors. The most common
activities done by the tour operators is to arranging a flights on a chartered airlines and transfer
the local representative from the airport to hotel. The primary function of the tour operators is to
reduce and solve the problems faced by most tourists such as the tourists fail to make proper
reservations of the hotel room through travel agents or other means, currency exchange and
communication (Alegre, et al. 2013). The tour operators also arrange the large group events,
seminars and conferences. Therefore, the tour operator industry plays an important role in the
tour and travel sector.
Task 1 (LO1)
P1.1 Analyze the effects of current and recent trends and developments on the
tour operators industry
There are several numbers of tour operators companies in UK help the travel and tourism sector
through providing different types of services to the tourists and travelers. The popular companies
of tour operators are as follows: Abercrombie and Kent, Adventures Abroad, Altour, AMA
Waterways etc. The tour operator companies provide different types of tourism services such as
Domestic tourism, Inbound tourism and Outbound tourism. In the Domestic tourism, the tourists
are resident of the country and they are going to visit their own country. In the Inbound tourism,
the tourists are nonresident country in which they are going to visit. In Outbound tourism, the
tourists are going to visit other countries (Anderson and Marcus, 2015). Sometimes the tour
operators horizontally and vertically integrated with the travel and tour companies to provide
services in an efficient manner. While the operators vertically integrate with other tour
companies, they try to purchase and own the essential elements of the needed to prepare the
package holiday. The essential elements of the holiday packages included airlines, a group of
hotels. In the vertically forward integrated process, tour operators try buy its own travel agencies.
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During the forward integration process the tour operators try to buy its own website, they can sell
its own products, and services direct to the consumers through the website. In the horizontal
integration the tour operators can follow two for the integration one is merger and the other is
acquisitions. In the process of merger, the tour operators can make a partnership with the travel
agencies who provide same products and services to the customers. For example, two tour
operator companies who provide same products and services to the consumers in same price. The
operators can combine themselves to provide quality product and services to the consumers at
lower price (Büttner, and Krumke, 2016). In the acquisition process one tour operators company
can buy other tour operator company and provide different services to the customers together.
For example, one hotel company can buy other hotel companies, which have stages of
production or different stages of service. In UK, there are different types tour operations operate
by the tour operators companies such as: Holiday tourism in which the tourists are going to visit
the country. Working holiday tourism the tourists are try to visit and work in the local industries
to recover the cost of the holiday. Political tourism such other countries political delegations are
going to visit the country and try to sign different kinds of contract and treaty with the country.
In the age of globalization the current trend and developments of the tour operators companies is
positive. There are different kind’s people who are associated with businesses and try to expand
the business in other countries. They always try to visit in UK to expand their businesses in UK.
This kind of activities makes great opportunities for the tour operators to develop their
businesses and develop different kind of tour packages for such business activities. The huge
development in technology has helped the tour operators to promote their holiday products and
packages through the website, social networking site and other information technological
aspects. The tour operators use different kinds of software to prepare the brochures and
advertisements about the holiday packages (De Sausmarez, 2013). The customers are also use
the website for determining and booking the suitable holiday packages for them. The
development in the airline services also helps the tour operators to book the air ticket for the
customers easily. The purchasing and spending power of the consumers also increase due to the
rapid development of the economy. Therefore, the consumers also increase their budgets for the
holiday purpose this help the tour operators to increase the businesses. The travel agencies also
develop new holiday packages for the new customers. The development in the political, social
and economical conditions also helps the tour operators to maintain the development. In present
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day, more tour operating companies are coming to the business with new holiday packages that
makes a great competition in the market therefore the customers get more attractive package
within reasonable prices. The tour operators also increase the number of satisfied customers
through using different technology. The future growth of the tour operating business depends on
the satisfaction of the customers (Ingadottir et al. 2016). The tour operator companies also
increase the skill of their employees therefore, this help the tour company to increase the quality
of the services. The tour operator companies also play a vital role in the economy of the country.
The number tourist from other countries depends on the services of the tour operating
companies. The increase in the number of tourists helped in the increment in the reserve of
foreign currency of the country that helps the country to improve the economic situation. The
tour operator companies also generating huge employment in the country.
Task 2 (LO2)
P2.1 Assessment of the stages and time scales involved in developing holiday
packages
The key stages involved in the developing of a holiday packages:
Determine the price of packages
The tour operator should consider the following aspects while determine the price of the
products. Such as development expenses of the products, entry and guide fees, cost of the food
providing to the customer, maintenance expenses of the hotels, promoting expenses of the
customers. The tour operators have to consider also the profit margin of the partners, the
unexpected expenses of the holidays and the price of the product should meet the breakeven
point of the tour operators. The company can take two days to determine the price of the
packages because the price of the packages depends on the customer’s demand from the
package. The tour operators have to acquire the information about the demand of the customers
and according to the demand, they have to determine the price of the packages.
Commission of the agents:
The tours operators have to consider the commission of the agent while determine the price of
the products. The tour operators have to pay 15-20% commission to the agents for promoting
their holiday packages to the customers and generating new customers to the tour operators
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(Xiang et al. 2015). The tour operators can take one day to determine the commission of the
agents because the commission of the agents depends on the economic condition of that country.
Legal compliance:
The tour operators have to prepare the advertisements of the packages according to the legal
compliances. The tour operators have to provide the all conditions clearly about the packages
therefore the operators can avoid the grievances of the customers associated with the services of
the packages (Alegre and Sard, 2015). The tour operators have to consider the package tour
regulations 1992 while preparing the holiday packages. The tour operators can take one day to
compliance the holiday package with the legal legislations.
Promote the package:
The tour operators have to target the market in which the tour sale their products. They have to
prepare brochure and booklet for the agent s and wholesalers therefore they can promote and
provide relevant information about the products to the customers. The tour operators can target
the schools, clubs and families to promote the domestic holiday packages and can higher the
foreign distributors for promoting the international holiday packages. The tour operator
companies also use the different kind of software, websites and social networking to promote the
holiday packages ( Haroutunian et al. 2012). The tour operators can take one week to promote
the package.
Packaging of the products:
The tour operators have to package the holiday packages to be more attractive to the customers
and the packaging of the products should be according to the targeted markets and customers.
For example, the holiday packages have to prepared according to the interest of the local
residents or selection of the destination in the holiday packages according to create personalized
itinerary of the customers. The packaging of the product takes one week because the tour
operators have to design the package of the products.
Duration of the packages:
The tour operators while preparing a particular holiday packages should determine the time
duration of the holiday packages. The total cost of the holiday packages are depends on the
duration n of the holiday packages therefore the tour operators have to determine the duration of
the holiday package to maintain the costs. The tour operator can take three days to determine the
duration of the holiday packages.
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P2.2 Evaluation of the suitability of different methods of contracting for
different components of the holiday and different types of tour operators 450
There are several components of the holiday but the following components are the major
components of the holiday, these are as follows:
A: Accommodation: The accommodation is a very important component of a holiday. The
tourists have to reserve the hotels, lodge and guesthouse for the purpose of stay during the
holiday. The tourists can make the reservation through the internet, agents and tour operators for
booking the hotels. The tour operators or agents also provide the cafeteria, fast food outlets and
restaurants to take some rest during travel the country (Choy and Can, 2012).
B. Transport: The selection of the transportation services depends on the way or time that
should be follow to reach the holiday destination. The tourists can book the railway or bus for the
transportation to the holiday destination if there is an opportunity to use the roadway. The tourist
can also book the air ticket if there is no opportunity of the roadway or there is a time issue with
the tourists
C: Travel agents: The tourists can also hire the travel agents to book the air tickets, bus tickets,
hotel, lodge etc. The travel agents can provide detail information about the expenses, the places
mentioned in the holiday packages. The travel agents also provide the information about the taste
and budget, chart their travel plan, and help in the currency exchange and car rentals.
D: Tour operators: The tour operators also provide different kinds of book the ticket of rail,
road and airways. They reserve the hotels, lodge and guesthouse on the behalf of the customers.
The tour operators also provide some services such as pick from the airport and drop to the
hotels, arranging different types of meetings, conferences and events for the customers (Taylor
and Toohey, 2012).
E: Other services: The tourists also required some other services during the holiday insurance
for the recovering the loss of accident during the holiday. The tourists also communicate with the
local residents, banking services to exchange the currency also hiring tour guide to get the
information about the attractive places of the destination. The tourist can also use the health
services of the country therefore, it is the responsible the tour operators to provide some
suggestions to the customers about the good hospitals of the UK.
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F: Regulatory bodies: There are different kinds of regulatory bodies, which are responsible for
the solutions of the problems associated with the holiday packages. The important regulatory
bodies are as follows:
I. International air transport association is responsible for simplify the process of shipping and
traveling.
II. United federation of travel agent association is responsible for protecting the interest of the
travel agents and tour operators from the government agencies and customers.
III. EU package travel regulations 1992 responsible for financial protection to the customers and
observe tour operators activities and services towards the customers.
IV. Civil Aviation authority provides air safety to the customers (Taylor and Toohey, 2012).
).
P2.3 Calculation of the selling price of a five days holiday packages
Expenses Amount
The rent of the room 60*.85*5 €255
Supplement expenses 10 Euros per person 20*.85*5 € 85
Rent of 20 sits luxury coach per person 50*.85*5 €212.5
Expenses on the guide 10*.85*5 € 42.5
Profit margin 10% €59.5
Total price of the package €654.5
The above calculation shows that there are different components associated with the holiday
packages. The travel agencies have to consider such components while calculating the sell price
of the holiday packages. The above calculation also consider the different expenses on different
components such as rent of the hotel rooms where the customers staying during the holiday. Rent
on the luxury coach for traveling different destination of the France and the travel agencies hire
the luxury coach to maintain the comfort ability during traveling different places in the France.
The travel agency also hires a guide who can provide greater information about the different
places of the France. The travel agency also considers their profit margin while calculating the
selling price because the travel agency wants to continue the business for this reason profit is
very important for the travel agency (Choy and Can, 2012).
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Task 3
P3.1 The planning decisions for designing a brochure
Market survey
The main aim of the travelling agency is to make the brochures in a better way so that it can
attract the large number of customers. Additionally, for making the brochures the market
research team has to make a proper market survey and design in an unique manner. They have to
collect the information regarding the taste and the preferences of the customers, by this manner
they have to satisfy the customers, and if the customers are satisfied then they are having the
probable chances to have a large market shares (Choy and Can, 2012).
Target market
Additionally, the organization has to select the target market first and then they have to design
their products. If the travelling agencies are charging high prices for the services then they have
to target the richer section of the society because they are having that ability to avail those
services. Moreover, the organization has to target the richer and the middle-income group of
peoples. If they are targeting both the sectors then they are having the chances to gain large
revenues and shares form the market (Haroutunian et al. 2012).
Promotion
Promotion is one of the main aspects of the marketing management. If effective means of
communication are not done then the organization cannot commence their business for a long
period. They have to implement new and innovative ideas. If new ideas are being taken then they
can attract large mass of customers. They can select the new means of promotion these are
promoting through television, radio, newspapers, magazines and many other means. Moreover,
organization needs to select the media in such a manner so that it can cover a large range of
customers. If large mass are covered then better responses can be gained. Since, organization can
take the assistance of the drone advertisements and it is the cheapest means of communication.
Distribution channel
While making the brochures reach to large group of people’s organization need to select proper
channels of distribution. Additionally, the channels of the distribution can be categorized in three
categories and they are one, two and three level of channels. Regarding to one level channel,
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there is a direct contact with the customers and the producers and in other levels there are
different intermediaries between the channels.
Collection of feedback
Additionally, feedbacks are the one with that organization prospers. The responsibility of the
management team is to collect the feedbacks form the customers. With the help of the feedback
the organization comes to know the strengths and the weaknesses. If organization gets a positive
feedback then they have to think what the newer ways they can improve their services are and if
they gets the negative feedback then those problems have to be mitigated.
P3.2 the alternatives of the traditional brochure which are using by the tour
operators
A brochure is nothing but a sheet of paper or papers that marketers use the to highlight the
specifically the product or services of the company. In the brochure, the relevant information
regarding the product or services of the business is provided concisely. Marketers consider the
brochure as the most effective tool that an organization can utilize to market or promote their
brand image. In simple terms, brochures are used to highlight the images, information and charts.
Traditionally the advisors, conducting any kind of informational seminars at any community
organization or educational institute, used the brochures. This kind of brochure provides the
course description, pertinent registration right and agenda related to the educational information.
Apart from the use made by the educationalist, marketers specifically make use of brochures to
advertise the products and services of the company for whom they are working. Thus, they
consider the brochures as the promotional documents. Since the business era has changed so do
the taste and preferences of the customer. In today’s world, the organizations are facing tough
competitions with the same line of the business. In order hold the position in the market, business
entities are advertising their brand widely among the customers globally, especially in the case of
tour operating the business. Thus, today’s marketers are preparing eye-catching brochure,
containing key information at the front page and rest information regarding the goodwill of the
company and so on. According to the expert marketers of tours and travel business, decisions of
the traveler depend on the creative information displayed on the concise brochure. Normally,
threefold brochure is considered attractive, concise and understandable, along with creative pics
and design posted on it to attract the eyes of the travelers. In fact, brochures nowadays are easily
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available in e-formats, which are called e-brochures. Travelers can avail the brochures from the
respective websites of the company. However, in earlier days, the brochures used to look similar
to the pamphlets and were not specifically found over internets. Travelers used to visit the office
of the company to collect the brochures. The specification of traditional brochures of tours and
travel is not limited to this, in fact, the brochures were mainly used by the educational institutes
and hotels or restaurants and were distributed through local newspapers, magazines or manually
in public places. However, this process was time-consuming and costly as compared to the
modern approach towards the preparation and distribution of brochures, especially by the tour
operators.
P 3.3 evaluating the suitability of various distribution methods that are used
to sell holiday package and recommending the most appropriate tour package
Since brochure is one of the marketing tools, which helps the business organization to advertise
their product or services, it needs to be distributed properly to the right target, to achieve the
objectives of the organization (De Sausmarez, 2013). The distribution of the brochure is just like
the distribution or sharing of information or ideas through various sources. Apart from the use of
local newspaper or magazines for the distribution of brochures, it can distribute in another
material way, which is as follows.
● Placing the brochure inside the packaged order
● Displaying the brochure into the reception area
● Displaying the brochure in the business centers
● Brochures can be mailed
● Targeting the trade shows or fairs or exhibitions to distribute brochures
● Collaborating with the complement business
● Distributing the brochures throughout malls
● Placing the brochures inside the presentation folders
● The tour operators can direct recruit their own salespersons to sale the holiday packages.
● The operators can hire some agencies to sell the holiday packages.
● The tour operators can operate their own call center or hire a call centre to promote the
holiday packages.
● The tour operators can also use the internet to distribute the holiday packages.
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● The tour operators can also use the Teletext app to distribute the holiday packages.
However, the above-mentioned methods are not exclusively for tour operators, except the
specific four methods mentioned in the list of methods of brochure distributions of brochures,
which are explained below.
Displaying the brochure into the reception area
It is found that displaying brochures of tours and travel business into the reception area helps the
organization to attract a number of customers, whoever, visit the office. Suppose, a customer has
visited the office for any other reason, he has to first confront with the receptionist at the
reception area. Suddenly his eyes will be catching the attractive brochure, containing the
information about holiday packages. Instead of his intention would be something else but he
might intend to apply for it.
Targeting the trade shows, fairs, or exhibitions to distribute brochures
Visitors attending trade shows or present in the exhibitions are considered to be the lover of
luxury and leisure. In fact, it is found that during the time of attending the trade shows by the
visitors, they tend to accept almost all the offers regarding leisure. Thus, marketers believe that
distributing tours and travel brochures through this method is profitable.
Collaborating with the complementary business
It is a good idea to collaborate with the complementary business to distribute brochures. It can be
well explained with an example. A tours and travel company can collaborate with different
agencies that deal with sales of air or railway tickets so that any customers arrive to purchase any
of the tickets, brochures should be distributed to them ((Alegre and Sard, 2015).).
Distributing the brochures throughout malls
Nowadays, people are mostly found involved in shopping and similar kind of activities and malls
are the best place considered for this kind of activities. Therefore, the operator should target
malls with a huge number of visitors to distribute brochures among them.
However, the distribution methods of brochures are completely objective, but the contents of the
brochure are subjective. In order to sell the holiday packages through the form of brochures,
these mentioned approaches are best suitable for a tour operator, because both subjective and
objective matters are fulfilled (Haroutunian et al. 2012).
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Task 4
4.1 Evaluating the strategic and tactical decision making for tour operators
Strategic decision-making
Strategic decision making is specifically involved in setting the mission, vision, goals, values and
objectives of the organization. Thus, strategic planning is based on the evaluation of certain
policies and principles of various disciplines to set the mentioned element of the organization.
The tour operators decide to plan new tour packages or holiday packages through certain
marketing strategies, which involves, pre sightseeing, understanding the cost of living and
standard of living of the desired destination. Based on these, they make further business
decisions (Alegre, et al. 2013). The tour operators can use some strategies to use the specialist
people in the organization. The tour operator can hire some marketing manager to prepare the
marketing strategies for the holiday packages and increase the market share. The tour operators
can hire some financial manager for calculating and planning the expenses included in the
holiday packages. The tour operators can also hire some specialist councilor to promoter the
necessity of the holiday packages to the customers.
Tactical decision-making
Tactical decisions, on the other hand are termed as medium term decisions. It helps the
organization to evaluate the strategies applied during the business plan making. The role of
tactics is to secure the implemented strategies from any unexpected changes. The tour operator
implements tactical decision making to know the trend of the credit rating of their organization
by different travelers.
4.2 Comparing the tactical decision that a tour operator selects in different
situations
A tour operator can apply different tactical decision in different situation to ensure that the tours
and travel business is running smoothly. The different ways, which are described below:
Raising awareness of local areas
It is a good idea to familiarize the products of the business with the local travel agents and
wholesalers to raise helping hand from them in need, like collaboration in future. In addition, a
tour operator can make a survey in local areas to know what kinds of people are interested in
travelling and exploring. For example, survey on different age groups and different interest
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shown by males and females. In addition, the tour operator should analyze the real income of the
local pedestrians and their standard of living (Anderson and Marcus, 2015).
Generating more bookings from existing customers
All the companies always try to retain their existing customers. Tour operator can retain existing
customer or generate more bookings from them by emailing to the existing database or by
attaching discounted physical coupon with the general mail to the existing database.
Attracting more customers from the specific market
Tour operator can attract more customers from the particular market, by reviewing the shopping
site online and advertising their products or services through popup window or flash message. A
tour operator can also deal with the local travel agents and acquire the information of interested
customers from their existing database (Alegre, et al. 2013).
Conclusion
After analyzing the above study, the tour operator company plays an important role in the travel
and tourism sector of the country. The tour operator companies provide some services that help
the travel and tourism industry to provide services to the customer in an efficient manner. The
tour operator companies are very important for the development of the economic situation of the
country. The country can earn more foreign currency and generating more employees in the
economy.
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Reference list
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