Tour Operation Management

This course delves into the intricate workings of the tour operators industry within the travel and tourism sector. From analyzing trends to strategic decision-making, students gain a comprehensive understanding of creating and selling holiday packages.

Tour operation management
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Contents
Introduction................................................................................................................................3
LO 1 Understand the tour operators industry within the travel and tourism sector...................4
P 1.1 Analyse the effects of current and recent trends and developments in the tour
operators industry...................................................................................................................4
LO2 Understand stages involved in creating holidays:..............................................................7
P 2.1 Assess the stages and timescales involved in developing holidays..............................7
P 2.2 Evaluate the suitability of different methods of contracting for different components
of the holiday and different types of tour operator.................................................................7
P 2.3 Calculate the selling price of a holiday from given information...................................8
LO3 Be able to review brochures and methods of distribution used to sell holidays..............10
P 3.1 Evaluate the planning decisions taken for the design of a selected brochure.............10
P 3.2 Assess the suitability of alternatives to a traditional brochure for different types of
tour operator.........................................................................................................................10
P 3.3 Evaluate the suitability of different methods of distribution used to sell a holiday for
different types of tour operator.............................................................................................11
LO4 Understand strategic and tactical decision making for tour operators.............................13
P 4.1 evaluate the strategic decisions made by different types of tour operator..................13
P 4.2 Compare the tactical decisions that could be taken by a selected tour operator in
different situations................................................................................................................14
Conclusion................................................................................................................................15
References................................................................................................................................16
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Introduction
Tour operators have significant role in the development of tourism industry. Operation of
industry cannot be expected without tour operators at present day. The importance of the tour
operator and the roles played by them has been understood. Stages of creation of holiday
package is also understood in detail. The preparation of broacher and the various mode that
are adopted for selling of the holiday packages by the different tour operators have been
discussed. The tactics and strategies to increase the growth and expansion of the business
have also been discussed in detail in the assignment. Each important aspect of tour operators
over the tourism industry as a whole has been discussed and the contribution made by the
tour operator is also party of the discussion in the assignment.
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LO 1 Understand the tour operators industry within the travel and tourism sector.
P 1.1 Analyse the effects of current and recent trends and developments on the tour
operators industry.
Date: 23 January 2018
Introduction:
Tour operation industry is dominated by four main tour operators i.e. inbound tour
operator; carries the handling of the inbound tourist of foreign country, outbound tour
operators; engage with the organisation of the multinational tourism packages, domestic
tour operators; focuses on domestic travellers and ground operators who manage the
destination. Tourism industry is changing and developing rapidly over the years. These
changes have some benefits as well as disadvantages for tour operators.
Leading tour operators of world and their share in 2017;
Name of tour operator
1. TCS world Travel, USA.
2. DuVine Cycling & Adventure Co.
3. Heritage Tours
4. Gray & Co.
5. Mountain Lodges of Peru
TCS world Travel is the leading tour operator in the world. It provides the private jet
facilities to the visitors and also provides all essential requirements of the visitors including
the doctor at stay. Though it is expensive it renders the best services to its customers.
Title: TCS
Source: (businessinsider.in, 2018)
DuVine Cycling & Adventure Co. is international cycling and adventurous company. It
provides the best and unforgettable experiences to its trawlers in small groups only. This
makes it number 2 operator in the world (Kapiki, 2012).
Heritage Tours is NewYork based tour operator. It provides to trawler the private custom
designed travels packages. It provides all kinds of services like, hotels, drivers, and guides.
Gray & Co. is based in North England. It makes research and designs the travel packages
to the most promising corners of the world. It provides the best accommodation facilities
from Villas to hotels. It provides the services of private jet to bike. It plans its packages as
per the needs of customer and it does not have its own planned agenda.
Mountain Lodges of Peru provides the combination of the adventures with the cultures. It
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offers to customers to experience the natural beauty. It provides the experience of various
kinds of adventures from day to day and the best accommodation facilities with the fine
cuisines (Dr. Rao, 2014).
The ranking of the above tour operators shows that development is taking place in the
trends of the tourism and they have impact over the industry as a whole.
Identified development and their impact on tourism industry:
Environmental awareness: The tourism companies have realised their responsibility
towards the environment and therefore they make the packages of traveling which do not
affect the environment. Tour operator itself takes part in the various environmental
awareness programme to make contribution to environment as it is part of their corporate
social responsibility.
Responsible tourism: Tour operators are also moving toward responsible tourism in
which they keep balance of the interest of the trawlers as well as local people. Tour
operators have restricted their tour packages to the limited number of persons only so that
natural and other resources are utilised in balanced way. Interest of environment, local
people and interest of visitors all are balanced under the concept of responsible tourism.
Effect of economy:
Tour operators' quality of services, nature of services rendered by them all have impact
overflow of money in the economy of the country. When best services are rendered by tour
operator tourism activity will increase consistently and the employment for native people
will also be maintained. This will increase the total expenditure and save in the country.
Role of the trade bodies:
Travel regulating bodies are there which also have effect over the working of tour
operators. ABTA, AITO, FTO, CAA, and UK inbound are the bodies that have control
over the business of tour operators. These agencies impose the ethical obligation on the
tour operator and when the unethical practices are taken up by tour operators appropriate
sanction is imposed in terms of fine. These agencies are very vigilant at present day and
restrict the unethical practices by tour operators in the UK (Hasan, 2015).
Conclusion:
It is concluded that tourism industry is subject to development. These developments have
brought changes in trends of the tourism industry as a whole. Improvement in services of
tour operators according to trends will be profit-making otherwise business may get
affected adversely by this.
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LO2 Understand stages involved in creating holidays:
Report
P 2.1 Assess the stages and timescales involved in developing holidays.
Title: Holiday Package
Source: (radiozdk.com, 2016)
In the development of the holidays various stages are there which have been discussed below:
Research: First of all research on the social, cultural and environmental factors will be
carried out in the Brussels and Brugge, Belgium. Further research will be carried out for the
destination of sightseeing which will be useful for the students. The accommodation facilities
for 42 students will then be assessed and the food preferences will also be checked along with
the accommodation. The cost will be compared with two or more tour operators and the mode
of the currency exchange will also be determined at this stage only.
Tour itinerary development: This stage will cover the process of determining the route
which will be covered and the time period of stay at a particular destination. Further
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suggestions and recommendations given by the students will be considered for determining
the itinerary tour packages (Aall, 2014).
Catalogue production: In this process catalogue has to be prepared which will be distributed
to the students for their information about each and every plan of the trip. Complete
information will be there in this regarding the time of journey, cost of the various facilities,
the sites to be visited etc.
Administrative staff: under this stage, the respective roles and responsibilities will be
assigned to respective resources who will help in the organisation of the successful trip.
Feedback: This stage is of reviewing the entire holiday trip and taking of the
recommendations and suggestion from the students about the proposed holiday package
(Jurigová, et. al., 2016).
Above discussed time scale and stage are there by which the trip package of 42 students for 5
days will be organised by any tour operator.
P 2.2 Evaluate the suitability of different methods of contracting for different
components of the holiday and different types of tour operator.
The modes of contracting for different components of holiday are:
Transportation: Transportation facilities will be decided by contracting with the local
transportation service providers of Brussels and Brugge, Belgium and the agreement in this
regard will be made. Transportation can also be arranged with the hotels where the
accommodation of the students is arranged for the five days in Brussels and Brugge, Belgium
respectively for sightseeing.
Accommodation: Several agreements will be required to be made for accommodation on
varying basis as the trip is planned to be visited in Brussels and Brugge, Belgium. The
separate co tracts will be made for separate place of residence. Accommodation should be
made at the place which will be in the centre of the location that will be visited by the
students in their 5 days trip.
Food: The contract for the food cannot be decided in advance as it will depend upon the taste
of the students. The different contract can be made with vendors of different countries to
supply the food at the various sites that are planned to be visited by the students in 5 days
(Jani, 2011).
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Tourist guide: As the students will travel the three different places and therefore they will be
in need of the tourist guide who will help them to understand the history of a particular site.
He will also help them to understand the local language. Therefore a tourist guide can be
contacted in advance and the agreement can be made with him for particular place and the
payment in lump sum can be decided.
P 2.3 Calculate the selling price of a holiday from given information.
Calculation of the price of trip of 42 students for London for 5 days.
Accommodation: It is estimated that double room will be costing £96 (with breakfast). And
therefore 21 rooms can be booked for 42 students and it will be booked for 4 nights and 5
days (96*21*4= 5880).
Transpiration: 48 sitter luxury coach £11,200.
Tour guide: £945.
Description Cost
Accommodation £8064
Transportation £11,200
Tour guide £945
Total £20209
Mark up 33% £6668.97
Total package £26877.97
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LO3 Be able to review brochures and methods of distribution used to sell holidays.
Executive Summary:
Tour operators have to prepare the complete broacher for sale of tourism package. Therefore
it has to be effective and must be prepared with the help of innovative techniques.
Introduction:
The planning for designing of broacher has been discussed and the material information that
will be included in broacher is also explained. The appropriateness of various modes of
supply is discussed for operators of tour in tourism industry.
P 3.1 Evaluate the planning decisions taken for the design of a selected brochure.
The decision of planning which was reserved for plan of education tourist and adventure
tourists will include the complete information about the respective packages which will guide
and motivate the students to select the designed adventurous and education trip. The
adventure tourism voucher will include the information about the tour operator based on
London, transportation, description of the adventurous spots and activities, time period
allocated to total tourism package and to each activities individually. The charges of the
services, terms and conditions of booking, the clause of insurance, charges of meal and extra
facilities etc. same is the case with the education tourism trip and compete description of the
place of educational importance which will be covered in the holiday trip will be included in
broacher. Other information will be same in the brochure which is mentioned in the
adventure tourism (Nyaruwata, 2017).
Along with the above things the design of broacher, the cost spent over it, the quality of
paper used, size and content etc. will also be taken by the students to design their own tour
broacher. The legal implication if any with regard to the publication of the broacher etc. will
also be taken into consideration.
P 3.2 Assess the suitability of alternatives to a traditional brochure for different types
of tour operator.
Traditional broacher is one of sources of getting information about the different tour
operators and the various tour programmes organised for the consumers. If the broacher of
any tour operator is effective it works for marketing the company and helps in increasing the
sale of its products. The traditional broachers were used as a source of information however
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with the use of technology and innovation broachers prepared performs the function of the
effective advertising the product and services of the tour operators (Fountoulaki, et. al.,
2015). The traditional broacher and their suitability for different tour operators are as follows:
Outbound Tour
operator
Inbound Tour
Operator
Domestic Tour
Operator
Ground Tour
Operator
Traditional broacher
is not as effective in
case of outbound
tour operator as the
various information
about the
multinational tours
cannot be rendered
effectively by this
mode.
Traditional broacher
is also not suitable
for the inbound
tourist as foreign
tourist are well
updated with the
technology and they
will understand in
better way the
information
mentioned in the
modern Broacher.
Traditional broacher
can prove beneficial
to some extent to
domestic tour if the
no new technology
and internet access is
used for
communication and
operation.
Traditional broacher
is also not beneficial
for the companies
and operator that are
already advanced in
terms of using
technology in their
work.
P 3.3 Evaluate the suitability of different methods of distribution used to sell a holiday
for different types of tour operator.
No single mode is there for advertisement and distribution of outing packages by various
kinds of operators of tour. However, all modes are not suitable for all types of the tour
operators. Therefore suitability is examined as below;
Direct Sale: Since the Domestic Tour operators target customers are the local visitors this
direct sale method it suitable for them.
Internet: It is suitable mode of distribution of the holiday package is for the Inbound Tour
operators as they deal with the foreign tourist who can be easily approached through internet.
It is also suitable for the Outbound tour operators as well who deals in the multinational
packages. It is also suitable for other two types of tour operators as well since the internet is
in excess of each and every one in the whole world (Alpe, 2013).
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Telephone: This mode is suitable for the Domestic Tour operators since it deals with the
local tourist only who can easily be convinced over telephone.
Conclusion:
Broacher has to be effective and it must contain all information that will be helpful in taking
decision of tour package by customers. For sailing and distribution of holiday package only
suitable mode must be selected by tour operator to get the positive results.
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LO4 Understand strategic and tactical decision making for tour operators.
Executive Summary:
In running the tourism business tour operators are required to take certain stringent decision
which is in the interest of the companies. The various kinds of tactical decision can be taken
by the tour operators in the various kinds of situations.
Introduction:
Decisions of strategic nature and their evolution is understood in tourism industry and the
tactics of decision are also explained in the various business situations.
P 4.1 evaluate the strategic decisions made by different types of tour operator.
It is imperative for tour operators to create the various strategic decision for the profit-making
and for the protection of the interest of the companies (Palatkova, 2012). These decisions are
generally taken in relation to the segmentation of the market, the prices of the services, for
the needs and expectations of the consumers etc. The decision taken by different tour
operators are discussed below:
Strategy of Cost:
The decision taken in relation to the prices of the tour packages come under this. It is
necessary for tour operators to give various kinds of discounts and rebates to customers on
various occasions to increase the sale of the packages and satisfy to more customers of it.
Mode of transportation: The mode of transportation has material bearing and therefore the
decision of the mode of transportation has to be effective. In case of inbound and outbound
tour operators, the air mode will be effective to render the services and goods effectively
across the multinational (Ogaja and Wanyoike, 2015).
Distribution decision:
This process also includes the various important decision regarding the distribution of the
product and services. In this supply chain management, agreements with the brokers take
place.
Positioning and image branding:
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Positioning and building brand image are also important for the tour operators. Domestic tour
operator can focus on the local market for the positioning and the outbound and inbound tour
operators can focus on the foreign markets for the positioning.
Investment Fund:
The decisions regarding the investments by the tour operators of funds with them are taken
under this for the generation of the income for the expansion of tour operation business.
P 4.2 Compare the tactical decisions that could be taken by a selected tour operator in
different situations.
Completion: When tour operator is facing huge completion in the market it can adopt the
various competitive strategies to give the tough completion to its own competitors. It can
lower down the prices of its services, it can offer the discounts on the various occasions, it
can use effective advertisement etc.
Price Wars: The tour operator has to keep the prices of the product not so high and not so
low. It must not gradually decrease the prices of its product otherwise it will have the impact
of lower down the quality of services. Prices have to be standardised (Potgieter, et. la.,2013).
Fluid pricing: Under this two or more modes of selling the product and services can be
taken. The main object is to increase the profit either through internet or personal selling.
Yield management: Under this tour operator can take the decision of increasing or
decreasing the prices of the product by anticipating the consumer behaviour. If the sale is
decreasing tour operator can bring the prices of the product little less and can increase the
revenue under this mode.
Late sales: It can also be used as a tactic to increase the profit-making by the tour operator.
Conclusion:
Tactics and strategic decision can be taken by the tour operators to increase the sale of the
company and thereby increasing the profit of Tour Company and to give tough completion as
well.
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Conclusion
Tour operations are not free from the risks, therefore there is also need of better planning and
adopting the strategies to escalate the sale and expansion of the packages of tourism. In a
complete tourism package, each and everything is important right from research to designing
of broacher and the adoption of the strategies and tactics to sale the tourism packages. For the
selling and distribution of the packages, different modes can be adopted by different kinds of
operators as all have their own limitations of working. Selection of right mode of distribution
along with the complete package prepared according to nee trends and needs of customers
will give the positive results to the tour company. It will give the advantage of the completion
over the other trader in the tourism industry.
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References
Aall, C., 2014. Sustainable Tourism in Practice: Promoting or Perverting the Quest for a
Sustainable Development? Sustainability, pp. 2562-2583.
Alpe, R., 2013. Rantakoski Designs’ case: Effective distribution strategy and sales channels.
Tampereen University of Applied Science.
Bent, V., 2016. Antigua and Barbuda Tourism meets travel trade at ETI- Puerto Rico.
Available at: http://radiozdk.com/main/2016/05/antigua-and-barbuda-tourism-meets-travel-
trade-at-eti-puerto-rico/. [23 January 2018]
Dr. Rao, R.S., 2014. Emerging trends in hospitality and tourism. International journal of
research – Granthaalayah.
Fitzmaurice, R. 2018, 11 of the most incredible places in the world that are best reached by
private jet. Available at: https://www.businessinsider.in/11-of-the-most-incredible-places-in-
the-world-that-are-best-reached-by-private-jet/articleshow/62606260.cms. [23 January 2018]
Fountoulaki, P., Lee, M. C. and Jung, T., 2015. Distribution Channels for Travel and
Tourism: The Case of Crete. Information and Communication Technologies in Tourism.
Hasan, M. A., 2015. Promotional activities in the strategic tourism development of Lapland.
University of applied sciences.
Jani, D., 2011. The Influence of Personality on Tourist Information Behaviour. e-Review of
Tourism Research, Vol. 9, No. 3.
Jurigová, Z., Tučková, Z. and Kuncová, M., 2016. Economic sustainability as a future
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sustainability issues.
Kapiki, S., 2012. Current and Future Trends in Tourism and Hospitality. The Case of Greece.
International Journal of Economic Practices and Theories, Vol. 2, No. 1.
Nyaruwata, S., 2017. Product Distribution Model for Developing Countries’s Tour Operators:
Experiences from Zimbabwe. International journal of innovative research & development.
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Ogaja, C. K. and Wanyoike, D. M., 2015. A comparative analysis of implementation of
tactical decisions in public universities in Kenya. International Journal of Economics,
Commerce and Management.
Palatkova, M., 2012. Strategic and tactical decision making for tour operators. Journal of
Tourism.
Potgietera, M., W de Jagerb, J. , H van Heerdenc, N., 2013. An innovative marketing
information system: a management tool for South African tour operators. Procedia - Social
and Behavioral Sciences, 733 – 741.
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