Tourism Industry Analysis and PESTEL Analysis

This assignment provides a comprehensive analysis of the tourism industry, including its current state, trends, and challenges. It also conducts a PESTEL analysis to identify the external factors affecting the industry, such as political, economic, social, technological, environmental, and legal influences. The assignment includes various references from academic journals and books, providing a thorough understanding of the subject.

Individual Report style Case Analysis
Travel and Tourism Sector

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Key historical developments in travel and tourism industry...........................................3
1.2 Structure of the travel and tourism sector........................................................................4
TASK 2............................................................................................................................................5
2.1 Function of government, government sponsored bodies and international agencies tourism
sector.......................................................................................................................................5
2.2 Local and national economic policy influences the success of the tourism and travel sector
................................................................................................................................................6
2.3 Implications of political change on the travel and tourism sector....................................7
Implications of political change.............................................................................................8
TASK 3............................................................................................................................................9
3.1 Factors affecting tourism demand...................................................................................9
3.2 Supply has changed to meet the effects of demand........................................................10
TASK 4..........................................................................................................................................11
4.1 Positive and Negative environmental, economic and social impacts of tourism...........11
4.2 Strategies that can be used to reduce negative impacts while increasing the positive
impacts..................................................................................................................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15
.......................................................................................................................................................16

INTRODUCTION
Travel and tourism is an activity related to touring any where in all over the world. The
tourism industry provides accommodations, information about destination places, transportation
facilities and also any other services to visitors. The many different travel and tourism industries
making large amount of money from this sector. It impact on the growth and productivity of
United Kingdom economy (Aldebert, Dang and Longhi, 2011). This sector gives its contribution
in economy of country. TUI is multinational tourism and travel organisation of United kingdom.
This big travel organisation included in developing the product quality to the consumer in
context to fulfil their needs and wants. In this present assignment studied about the historical
development in tourism and travel sector. There is also a discussion regarding the structure of
travel and tourism. Under this report discuss about implications of political change on the sector
of travel and tourism in various countries.
TASK 1
1.1 Key historical developments in travel and tourism industry
In past few decades, the rich class people of the Rome country spend their time by doing
the tour in the various coastal destinations. At that time, the travel and tourism sector came in to
an existence. At the time of medieval age, interest enhancement in the pilgrimages gives the
rapid growth in this tourism industry. In this context, the large number of people are take interest
in the travelling. The people began taking about their interest in the tourism. People like to spend
their money and also time to visit the various destination places. The change in human behaviour
and also their demands from tourism sector has been make the tourism and also travel keep with
any other kind of sector. In the beginning of the develop tourism consists transpiration and also
travelling of products and services. In the year 1960, there are some of the effective factors
notices like for an instance disposed customer interest for long distance trips, maximising the
availabilities of free time, developing an income level of people etc.
In the past centuries, The English People are like to travelling for the purpose of
eduction in the various countries from the tourism business. But in 19th Century, this sector
gaining popularity between the large number of people. But in this present time period, the
development of the tourism sector is badly impacted from the other number of industries. There

are many different strategies which are used and also followed through the large number of plays
in the market of travel and tourism.
There are some historical developments are mentions below:
Before 1945
In past time period, till an ending of the 16 century, all people lived in an agricultural
communities which moved from the local to the rural areas. In starting of an industrial
revolution, there was a development of factory and urban areas.
1945-1979
In this time period, travel and tourism industry growing rapidly. In this many hotels start
to build and also provide many effective services to tourists. It is a growing stage. In this
travelling companies provides the tour operator services to people.
1980 to present time
In year 1980, some airlines stated to providing its travelling related services. But rapidly,
there is an invention of many airlines which helps in travelling of tourists. In this current time
period, travelling agencies use the new technology for satisfying needs and wants.
1.2 Structure of the travel and tourism sector
In the economy of United Kingdom, the tourism sectors plays a necessary and essential
role. This sector provides the help to those businesses which are directly and also indirectly
connected to to this tourism sector. This sector are developing the many different concepts for
the purpose of changing its structure. The concepts related to the structure of tourism industry are
concerned to the distribution chain and also the various roles of different sectors like
accommodation, government and the tour operators.

This diagram is a structure of travel and tourism industry and in this various departments are
included such as transportation, accommodation, travel planning, local travel etc. These all are
given below as above:
Travel planning- Under it, the tour agencies and also tour operators both are approaches
for doing the planning of the tour in the existing time period. Basically, the tourism sector has
bee run and also operated with the help of tour operator. It is the duty of tour operator is to
introduce the tourism goods with the accommodation with many other facilities to visitors.
Transportation- It plays an important part in order to attracting the visitors to the
destination places. An availability of visitors attraction places is according to the transportation
system of those places. In the transportation includes rails, flights, buses, cars etc. In this the
TUI Group should provides the picking and dropping facilities to the people.
Accommodation- It is the main feature or specification in the tourism sector. An
accommodation with the beverages and also food are founded through travellers, facilities,
quality services and also products, discounts, offers are necessary in accommodation. It is the
duty of TUI Group is to provide the effective accommodation facilities to people such as rooms,
resorts, food facilities etc.
Tourism destination- In United Kingdom, there are many kinds of attraction places or
visiting destinations such as man made, natural resource, cultural etc. It is the responsibility of
the tour operator is to provide destination to visitors on the basis of their demand.

TASK 2
2.1 Function of government, government sponsored bodies and international agencies tourism
sector
Tourism and also travel sector is one of the vest sector of market and it attracts the large
number of new comers towards itself. The tourism industry is very broad and also open which
impact on the non- resident along with the local people and on their visit. It is a well known facts
from which this sector is engaged through the many business enterprises. There are some
functions of government sponsored bodies, government and the international agencies mentions
below as above:
International bodies- In addition to increasing the sector of tourism, the United
Kingdom country efforts not only on the local level business but on the international level. It is
the big fact that travel and tourism is only the one sector which gives an importance to the
foreign currency in context to big amount. There are many different international agencies such
as WTO, World Tourism Council, European Union, Internation Air Association of
Transportation are developing the effective rules and also policies in a systematic way. The main
motive of these international agencies to enhancing development of economic growth and
productivity of United Kingdom. Many roles of international agencies are mentions below:
 Maximising the Foreign Direct Investment.
 Promoting an economic development of country.
Government- IN the travel and tourism sector, TUI Group is one of the good and big
industry. The income of TUI Group which is generated through this industry impact on local
government of UK. In this sector, there are many rules and restrictions are applied through the
local government of UK from this the local functioning of this sector will not be impacted. The
government formulates the many regulations and also policies in context to reducing the negative
impacts on the tourism sector. The travelling industry pay around 14% tax from its income. The
government of United Kingdom takes many effective strategic decisions in context to
maximising the goodwill and affection of many destination places.
2.2 Local and national economic policy influences the success of the tourism and travel sector
Many of the different countries are endure from the problems related to the recession and
loss. In year 2009, Gross Domestic Product rate of United Kingdom was minimized by the 9.8%.

from this problem, the people or visitors are decreased in numbers. In context to this, for
managing this deficiency in visitors and increasing the economic rate of UK, the local
government of United Kingdom made some effective rules and also regulations. Under this, the
pound currency is very stronger as comparison to the any other currency. Related to it, the other
problem of this sector is seasonality, in holidays time is most engaged time in this sector. At the
time of holidays, people are go for the travelling purpose at various destination places with their
families. In context to growing the tourism industry, the UK government develops some of the
effective policies. For increasing the economic rate of country, government does the positive
changes at the destinations. This industry works along with the various functions of the
government and some regulatory bodies for increasing the United Kingdom economic rate.
For increasing the economic rate of UK, it is necessary for the UK is to develop some job
related opportunities to the local people. The government of United Kingdom spend more money
for enhancing the market share and also growth rate. The main focus of government is to
developing the destination places from this large number of people come for the visit.
Influences of national and local economic policy on success of travel and tourism
industry given below as above:
Direct influence- An economic policy develops directly affect with currency rates
conversion and monetary rates which allow and not permit tourism traffic in order to attract
visitors for sites.
Indirect influence- It reduce reserves, minimizes in attraction sites popularity and also
enhance expenses to meet maintenance of attraction sites.
Economic policy- It impacted because of the minimum inflow of currency so from the
the foreign services are reduced regularly which makes the advancements as well as loans very
costly.

2.3 Implications of political change on the travel and tourism sector

Implications of political change
By- XYZ
Date- 28th October, 2017
The change in politics develops a big and impact on the travel and tourism industry of United
Kingdom. Some of the changes and modifications in the politics can result the fear of safety in
visitors mind and they neglect to visiting on such types of countries. In the home country,
political change can also the affect on travelling sector of another country. From changing in
politics, new party will make some changes in existing polices and regulations and will also
formulates the new policies. There are some different components or elements related to the
change in politics. The impact of political change in every country can be negative and also can
be positive. Its positive affect is that it helps in making improvement in the economic
development of UK. An inference of the political change in tourism sector in various countries
are discussed. Another positive impact is that from the political change, new government come
with new ideas or thoughts for growing this sector. This organisation also gives the training
facilities to staff members for enhancing their skills and also gives the satisfaction level to
consumers. TUI Group is the biggest tour operator which gives many effective services to
tourists. It is the responsibility of tour operator is to fulfil the needs and wants of tourists by
developing the effective strategies and regulations. Many different factors can be related to the
political changes. It can be impact on the development of country. At the time of leaving the
European Union, there are many problems which are faced by the Britain. And after some time
this company develops its own policies and strategies for attracting the large number of people.
In addition to attracting the large number of people towards the destination places, the United
Kingdom government develops some effective policies.
For an example- Government of United Kingdom, formulated the various policies and
regulations in context to attract the more consumers. It is necessary for tour operators to follow
all rules and policies in an effective manner by which operators can give the legal services to
visitors. On the other hand, negative impact of political change is the no stability of government
and it results in decreasing the large number of tourists. From this, the currency of country is
also impacted. It is very different for the tourism organisations is to follow the new policies and
also rules of new government. But United Kingdom government makes policies which are
beneficial for travelling industry. The TUI organisation provides all the services to customers or

visitors on the basis of their demands which are come from the various countries.
The other best example is China, this country is the biggest and developing country in
travelling industry. The China government formulating some effective strategies for the purpose
of attracting more consumers. China government regularly revaluation the plan. If there is a
need of any kind of modification in policies of government then in this case it can be impacted
on the economy of United Kingdom. After Brexit, travelling industry is work as the close
partners in regards to promote capital with enhancing in Chinese visitors and also increase those
people who are come to United Kingdom for the purpose of visiting or travelling in future. It
will develop the positive affect on UK economy.
TASK 3
3.1 Factors affecting tourism demand
Tourism is the demand oriented. There are many large number of factors Sesotho can
impact on the demand of tourism and also their buying behaviour. The demand of visitors can be
impacted by the external factors. The demand of tourism covers the many factors at the
government level. It is necessary for tour operator is to evaluate all factors which are impacting
on the demand of tourists. The demands and needs of customers are changing day by day or can
say in a short period of time. There are some elements related to the tourists demand are
geographical, visitors and the tourism sector (Garín-Muñoz and Pérez-Amaral, 2011). The
tourism sector consists different variety of firms for which it is responsible to delivering tourism
goods. These different kinds of industries are situated at various places and also providing the
good quality of services on the basis of consumers or tourists demand. The main and primary
motive of TUI organisation is to fulfil the needs and demands of customers by providing them
better quality of services. There are some factors given below which an impact on the tourism
demand:
Economic factor- Under this external factor, TUI Group provides the effective services
to visitor on the basis of their needs and also their capabilities. There are two categories of
people one is low income level and another is high income level people. Low income group
people can not afford and also avail the expensive services. So in addition to this, it is necessary
for TUI group is to identify such factors which impact on demand of tourists (Heung, Kucukusta

and Song, 2010). So, TUI group should set the reasonable cost, so each income level people can
avail its services.
Demographic factor- This kind of factor consists the age, occupation, gender, income
level, education of various categories of people who are connected from various places. Under
this types of factor, it is difficult to company is to identify and also evaluate the demands and
needs of various category of people belongs of different countries. So, it can affect on tourism
demand.
Social factors- People are go for visit to other places or countries. The culture of every
country is different. The TUI group provides facilities like accessibilities, accommodation and
also amenities to visitors. There all facilities are concerned with the culture (Hudson and Thal,
2013). In context to this, it is the duty of TUI group is to render those services which are
according to local people.
Cultural factors- In UK country, there are many historical places from which visitors are
to be attracted. It is necessary for TUI group is to understand and identify the needs of visitors
and also travel those destinations which they have to visit.
Goods quality- It can be impact on the demand of tourism. The tourists or people are
quality conscious. They need good quality of services as well as goods. So, in context to this, it is
necessary for TUI group to focus on satisfying needs and demand of customers. So that they can
consume more services and also products of people. It will be helpful in increasing the customers
rapidly.
Technology- It impacts in business operations along with the activities in a positive and
negative manner. In order to increasing the quality of goods and doing the business operations
effectively, advanced technology will be helpful. From this it can positively impact on the
business as well as demand of tourists.
3.2 Supply has changed to meet the effects of demand
The supply and demand of travel sector are related with each other. TUI group is the
largest tourism industry in United Kingdom. They main motive of this company is to sustain its
business at market place and also reach to the retaining of all suppliers which can monitor and
also control the progress of this company in a proper and effective manner. The supply of goods
as well as services are not expensive due to arising the short fall. The needs and also tastes of
people are change in a short period of time. So, in context to this it is the duty of employer is to

conduct the research of market in context to evaluate the needs and demands of services and
products. It is necessary for TUI group is to meet with an equilibrium points where the demand
and supply should be at equal point. There are some following provisions are mentions below
which can meet with the expectations and needs of consumers:
Technologies intermediaries- Technology is very helpful in making the business
process effective and systematic. From the technologies intermediaries, tour operator know about
the needs and demands of visitors or customers (Malakauskaite and Navickas, 2010). With the
help of this company can provide the services and good according to their demand. TUI Group
uses latest and also advanced technology which is helpful in meeting the demand with supply. In
this modern time, it is easy for company in context to examining consumer wants from
technologies.
Quality- It is necessary for company is to ensure about the quality of products. The TUI
Group always take care the quality of its services as well as goods. In regards to this, manager
conducts training and development to current as well as new staff members for increasing the
sales. In this the quality can be evaluate in services terms.
Accommodation- When people come for travelling, then it is the duty of tour operator is
to provide all the satisfactory facilities to them. An accommodation consists hotel rooms,
infrastructure, services facilities and many other.
Product types- The visitors demand only those goods and services which can satisfy
their demands or requirements. So in context to this, it is necessary for TUI group is to identify
their needs and also render them goods on the basis of their needs (Peeters and Dubois, 2010).
In order to fulfilling the demands and wants of people, there should be the effective
provisions of the supply. If the demand and supply will be equal, then it will be helpful in
making the equilibrium point. From the given different factors, supply can be impacted. In
addition to this, it is essential for keep maintain the demand and also provide better services top
consumers.
TASK 4
4.1 Positive and Negative environmental, economic and social impacts of tourism
For conducting a business, it is necessary for company is to evaluate the negative as well
as positive affects on the social, environmental and also economic actors. The TUI Group is one

of the largest travelling industry in all over the world. This company evaluates these all the
factors on the continuously basis. It is very helpful in measuring the sustaining this organisation
for long period of time.
For an example- If there is high income group people and they wish to visit the many
attractive places in various countries and with the help of this TU Group can evaluate the supply
and also demand of services and goods.
There are some positive as well as negative impacts of social, economic and
environmental factors are given below:
Social factor- In an economy of United Kingdom, there are large number of people who
are related to the various region, beliefs and also culture (Spenceley, 2012). In TUI Group, there
are large number of staff members are working and they all are related to the different culture.
Positive impact
 Its positive affect is that it gives some advantages to the local economy for
making an improvement in infrastructure and amenities.
 It is helpful in developing the economic condition of local economy.
 Its good impact is that it will be helpful for an organisation to give services in
United kingdom .
 The positive impact is that it is helpful in increasing the youth exchange.
 It is helpful in arising the many employment opportunities to increasing the
wealth of country.
Illustration 1: PESTLE Analysis
Source: (Scanning the Environment: PESTEL Analysis, 2016)

Negative Impacts
 It is difficult of TUI group is to evaluate the needs of local people due to the
different caste and religion.
 The behaviour and attitude of an individual impact on the local community.
 Many issues can be arise like for an instance thefts, crimes and many other things.
Economic factors- This factor develops the positive as well as negative affect on
economy.
Positive impacts
 Its positive impact is that it is helpful in generating and many job opportunities for
unemployed people of United Kingdom in the transportation as well as retail
sector (Ramayah, T., Lee and In, 2011).
 It provides many beneficial opportunities to small business of rural areas.
 Increasing the standard of living of local community.
Negative impacts
 Its negative affects is that the government revenue will based on travelling and
tourism industry.
 From this factor, company does not use the efficient and also effective resources.
 Seasonality
 Money money of finance is spend in the various facilities.
Environmental factors- It is necessary for an organisation is to use the natural resources
in context to giving the better quality services and products.
Positive impact
 It is helpful in promoting the wild life conservation such as rain forest and natural
resources.
 Its positive impact is that it helps in improving the preservation and marine parks
for animals.
Negative impact
 Its negative impact is that it enhances pollution through littering, sewage,
vehicles.
 If people will use more materials of plastics to badly affect an environment.

4.2 Strategies that can be used to reduce negative impacts while increasing the positive impacts
To reducing the negative impact or increasing positive affects, government formulates
many policies and also rules (Zapata and Hall, 2012). To develop the more positive impact, it is
necessary for TUI Group is to follow all rules and also policies which are made by government
of UK.
Some of strategies are given below:
Minimising areas- In UK, there are many places of visit where large number of people
come. In order to enhancing the profit level, government can charge high price. So, the
government as well as TUI Group has an authority to take high charge to the restricted areas.
Technology- For making improvement in the production of goods and services. Is is
essential to TUI Group is to adopt and use advanced technology for increasing the quality of
goods (Adlwarth, 2010). From using the latest technology, time as well as cost both will be
reduced.
Give training to employees- Training is helpful in increasing the knowledge and also
working abilities of person. So, it is the duty of an employer is to provide training facilities to the
new and also existing staff members. TUI Group proves training with the help of new
technologies. It develops the positive impact on business of TUI Group. With the help of training
skills along with the competencies of persons will be enhanced. It will be helpful for an
organisation as well as staff members.
Promotion- It is necessary for the TUI company to do the promotion and also aware
people about the destination places so from this more people will travel to destination places and
with the help of this economy of United Kingdom will be positively impacted.
CONCLUSION
It has been concluded from the above mention report that the large number of people
come for travelling in United Kingdom from all over the world. The TUI tourism agency
provides the good package of travelling to people. In this present business report studied about
the structure and the history of travel and tourism sector. Under this assignment studied
regarding the various functions of government, international agencies and also government
sponsored bodies in tourism and travelling sector. There is an implication of the political change
in tourism sector in various countries. In this business assignment also studied about the negative

and also positive impact of environmental, economic and also social on travelling and tourism
industry.
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