Finance and Funding in the Travel and Tourism Sector

Finance and Funding in the
Travel and Tourism Sector

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Importance of costs and volume in financial management .............................................1
1.2 Pricing methods used in the travel and tourism sector.....................................................2
1.3 Factors influencing profit for travel and tourism businesses............................................4
TASK 2 COVERED IN PPT...........................................................................................................4
TASK 3............................................................................................................................................4
3.1 Interpret travel and tourism financial accounts................................................................4
TASK4...........................................................................................................................................10
4.1 Covered in Leaflets:......................................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Finance is an essential aspects of any business which is required to manage and control
any business operation whether related with travel and tourism sectors. Funding is the amount of
capital provided by the government for a particular purpose. This report is based on Carnival
Corporation & plc is the world leading leisure travel organization along with the operations of
voyage brands in North America, Europe and Australia. This report covers valuable aspects of
finance which are required in travelling sectors. This would elaborates the diverse pricing
techniques which could be applied in travel and tourism sector.
Along with different components affects the profitability of tourism sectors (Gibson,
Kaplanidou and Kang, 2012). Additionally, this report covers the presentation which elaborates
diverse kinds of data which is required in management of tourism sectors. Such kind of
management information can contribute for decision making process. This report also covers
Dalata Hotel Group Plc in which this would demonstrates use of the financial report of the firm
and interrelate with coming accounting years (Social and Economic Aspects, 2015). At the end
of the report, this report features with the leaflets which evaluates the sources of funding required
at the time of planning the tour packages for the individuals.
TASK 1
1.1 Importance of costs and volume in financial management
Carnival corporation and plc: This company is the world's largest leisure travel
company. Which have a plenty of journey brands in many parts of the nation. The company's
portfolio of 10 global cruise line brands. In addition to this, cited organization owns a tour firm
which complements its cruise operations:
Cost: The costs refers to the money which is required for managing the plan of trip and various
resources. Costs is termed as an important component in tourism sectors (Murphy, 2013).
Volume: It refers as the total quantity of expenses which denote in the financial terms and are
related with travelling.
Significance of costs: It is crucial for firm development. The costs plays a vital role for
the firm success of failure. If the costs of the product or service of the cited firm is higher than
their contenders then the company can not meet its desired sales outcomes. On the other hand, if
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the costs of the company is reasonable and cheap then the the firm can get the sustainable
development (Song and Lin, 2010).
 Cost reduction: Cost refers to the critical component in the firm which is used by the
company in order to reduce the costs and increase maximum chances of profitability. It is
mainly relies on the company's services and product offering. The cost could be lower or
higher according to the requirement of business.
 Decision making: In order to manage and control the excess use of cost management
need to make a well organised plan which can benefits to the organisation or individual at
the same time.
 Designing financial structure: In order to make smooth running of travel and tourism
sectors a perfect structure should be followed. It will help to complete the target in very
quick time.
 Enhancing management performance: It has been seen that finance can protect and
increase the performance of the travelling sector. Cost of project should always be
managed so that any situation can be handled at the right time.
Importance of Volume:
 Break even analysis: This is the techniques of identifying outcomes which indicated that
total expenses and profit generated by the company during the year. For this concern, it is
essential to assess the BEP to realize the costs covering period (Morrison, 2013).
 Economies of scale: These are the additional costs saving with the increment under the
production level. Travel and tourism sector can save the costs by implementing this
particular costs.
 Diseconomies of scale: It is known as the situation under which it is no longer operate
for a particular firm or sector. It occurs when a firm increases marginal costs per extra
units of outputs. As far as tourism business is concerned, analysis of this volume is
required to be done about the business operations.
1.2 Pricing methods used in the travel and tourism sector
Diverse pricing tools applied in the travel and tourism sector:
Rack rates:- The rack rates are total rates elaborated by the firm without discounts or
offers. They are the rates for the full season written on the Brochures (Vanhove, 2011).
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