Tour Operators and Operations Management

The project report explores various aspects of tour operators and their operations management in the tourism industry. It delves into strategic decision-making, tactical marketing, yield management, and consolidation as key factors in designing effective holiday plans. The report also touches upon the importance of proper staging and timescales for developing holidays, different methods of contracting for identifying holiday elements, and creating attractive brochures through effective planning decisions.

TOUR OPERATION
MANAGEMENT

INTRODUCTION
Tour operation is considered as an important element of tourism industry, tour operators
are determined as a partner in distribution channel for providing services to outbound, inbound
and domestic tourists. Tour operation helps nation in generating ample number of funds by
providing wide range of services and other facilities. Company which has been taken in this
report is Trailfinders, which is one of the most renowned company of travel in United Kingdom.
It has around 29 travel centres in UK. Present report will focus on understanding the industry of
tour operators within travel and tourism sector. Apart from this, stages that are involved in
creating holiday is also mentioned in this assignment. Lastly, this report will help in knowing
strategic and tactical decision making for tour operators.
TASK 1
1.1 Leaflet
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Effects of current and recent
trends and development
on tour operators’ industry
Tour operators: They
are the one who combine the
process of tour and travel in
order to create a package so
that it can be provided to
clients as per the needs and
wants. They design and
produce a brochure so as to
promote their products which
are related to holiday packages
(Holland and Leslie, 2017).
Role of Tour Operators:
An effective tour
operator considers both,
touring components and
travelling for making an
effective plan and appropriate
itineraries, brochures are made
with some attractive images so
that it can grab attention of
maximum number of people.
Different kinds of Tour
Operators:
Inbound Operators:
They are considered as one
who provide services to those
Tour Operators Associations
Generally, there
different tour operators
associations who play their
role in making process of tour
and travel more easier and this
includes:
Association of British
Travel Agents: There prime
function is to raise the standard
of industry by providing
guidance on issues that are
related to health and safety. In
addition to this, they give
financial protection to
travellers who are travelling
from one place to another or
within the area . (Ledin and
Machin, 2016)
Association of
Independent Tour Operators:
This includes around 120
specialist and independent tour
operators and members who
are included in this can operate
in approximately 170 countries
including United Kingdom as
well. In addition to this, it
provides activities that are
related to adventure, safaris,
sports and many more
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travellers who have come to
their nation for a visit. Thus,
they take care and assist tourist
and give them facilities like
pickup and drop services,
provide tourist with local
guidance and arrange
accommodations and other
services for their stay and visit
(Kim and Kang, 2015).
Outbound Operators:
In this, residents of one
country are taken to other
nation. They take these
travellers to all over the world.
These outbound tour operators
sell holiday package to an
individual or a group of people
for a particular pre-decided
period.
Domestic Operators:
According to current scenario,
domestic tour is aggressively
entering into the market and
they are promoting themselves
in order to increase their sales
and profitability. Therefore,
domestic tour operators
operate their business within
the country and provide
facilities and services.
(Sidorov, 2018).
Effects of current trends and
development of tour
operators:
Flexible booking
options: Due to the
advancement in technologies,
people can now book their
tickets through online
procedure as per the choices
and preferences. Thus, it has
cut down the cost and time
taking procedure. Now a days'
people can book tickets
according to their ease and
comfort. Therefore,
Trailfinders have developed
websites and application
through which clients can
book their tickets.
Independent
travellers: As per the recent
trends instead of visiting in a
group people are preferring to
travel alone. The biggest
reason of this is because of
cheap deals and holiday
packages that are available in
the market. Travellers who are
included in this are majorly
businessmen and compulsive
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Specialist Operators:
They are the tour operators
who are specialised in giving
services in a particular area.
For example: adventure trips,
bungee jumping, scuba diving
and many more (Cetin and
Yarcan, 2017) .
travellers who are travelling so
as to pursue their passion
related to mountain biking,
adventure sport etc.,
Destination
Marketing: Technologies has
made the process of marketing
simpler and as compared to
older times people are not
much aware of destinations
and other places that are
trending. In context with
Trailfinders, they are hiring
advertisement agencies so that
they can help company in
attracting a large number of
travellers towards their
organisation.
Technology: With the
change in course of time
technology is playing an
important role for tour and
travel company. Technologies
are assisting these companies
in attracting a large number of
people. Customers can now
book their tickets as per their
convenience and preferred
choices.
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TASK 2
2.1
For proper holiday plan and better utilization of resources, its vital for Trailfinders to plan
accordingly for holidays. Below discussed are the stages used for developing plan for holiday
are: Analyzing the destination: Analyzing the destination place is the most important activity
in the timescale. Examination and studying the destination place helps to better
understand the weather, culture, etc., of particular destination (Kerzner and Kerzner,
2017). Research: Investigation of the various features that can be offered to the visitors of the
selected place is been included in the research for developing holidays. With the help of
the research various other aspects related to the holiday destination, cost, etc., can be
investigated and examined for providing better tour. Negotiation: It is important to negotiate with the service provider related to different
activities and aspects included in planning the holiday. Financial assessment and pricing: Planning activities should also include planning and
evaluating the price and the other financial aspects before planning for holiday. The
pricing and the costs that would include during holiday trip should also be determined
and required for planning (Vellas, 2016). Tour operator’s brochure: While planning for holiday the brochure of the Trailfinders is
been considered to know about the company plans and the options for destinations, plans,
prices, etc.
 Feedbacks: It’s a stage where the monitoring and review of the holiday tour is being
taken comments, suggestions or feedback, etc. So that any changes can be incorporated
for improving and avoid any problem that could arise during holiday.
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2.2
Contracting refers to entering of two or more parties into an agreement. It is a deal done or
entering into an agreement for providing the product or services on the agreed price or value
(Becker, 2016). For planning facilities and making the holiday successful, planning for different
contracts are being made and below discussed are different methods of contracting for different
components of holiday and tour operator are:
 Fixed contract: The fixed contracting refers to agreement at high intake basis. Fixed
contracting provides same offerings at fixed package for same rates. It is only effective in
the situation of bulk consumption or the high level of consumption done by the large
number of people (Eugenio-Martin and Inchausti-Sintes, 2016Buhalis, 2015). The fixed
contracting in Trailfinders involves great offers as the ample group is assumed to book
their holiday tour services.
 Sale only contract: Sale only contract is comparatively high in prices and costly in terms
of fixed contract. The Sale only contracts are mostly done on seasons where there is
boom in customers for holiday tour facilities are much higher and the Tour operators take
the advantage of such prior situation. The cost of the services is marked high to earn extra
profit and get the maximum benefit. The service provider earns maximum benefit by
offering high cost to the potential consumers (Eugenio-Martin and Inchausti-Sintes,
2016). For such contract Trailfinders basically focus on the prospective customers and
provide the facilities for much higher prices. As a particular segment of customer is been
focused these contract bears risk of low response as it is much costly.
Both these two methods are adopted by the Trailfinders during planning a holiday tour. The more
appropriate method of contracting is the fixed contracting method, as it is much certain and less
costly and is being done for ample number of traveler.
The person guiding, managing the tours and the provides services is called a tour operator.
Tour operator provides assistance to the people visiting for holidays. Below described are
different types of tour operators:
 Inbound tour operators: The inbound tour operators are who directly contact or bounds
with the tourists and provide them the facilities and services from the beginning to the
end of the tour. (Buhalis, 2015).
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 Outbound tour operators: The outbound tour operators provides tour services to a
group or individuals domestically or of different nation.
 Domestic tour operator: The domestic tour operator is who provides the services in the
home country of the operator. The domestic tour operators guide the people who visit in
the domestic country.
 Ground operators: The ground operator is an agency or a service provider who books
the destinations and hotels etc. from their particular place. Ground operators provide the
facility of ready booking at the destination places (Kim and Kang, 2015).
2.3
Following is an estimate for a luxury coach and educational tour for students (above 18 age
group) from London, UK to Brussels and Brugge, Belgium in August 2019 and the
proposed group size is 42 students for 5 nights. Hotel Grand Casselbergh, Bruges special
rate for the group is 92 euros per person includes twin room with breakfast. 45-seater
luxury coach for 7350 pound and the spot exchange rate is 1.12 euros per 1 pound, which
cost 8,232 euros for the coach which includes 2 drivers, a tour manager, fuel and all ferry
and road taxes. Cost of tour guide throughout the tour is 1020 euros. Charge for visitor
attraction per person is 52 euros. Company’s selling and administration cost and profit is
25% of the total cost.
S.no. Particulars Cost per
person
Total Amount
(for 42 students)
Rooms at Grand Casselbergh in Bruges 92 euros 3,864 euros
45-Seater luxury coach (other charges and taxes
included)
8,232 euros *
Visitor attractions charge 52 euros 2,184 euros
Charge of local tour guide 1020 euros
Total cost 15,300 euros
Add: Profit @ 25% 3,825 euros
Sales Price 19,125 euros
*Spot exchange rate is 1.12 euros per 1 pound (7,350 pounds x 1.12 = 8,232 euros)
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TASK 3
13.1
To attract the visitors and for providing information on the travelling features tourism
sector uses brochures and pamphlets. By providing the brochures Trailfinders provides
information and details of the travelling and tour and its expenses, and by making an attractive
brochure it can gain the maximum attention of the visitors.
The various planning decisions for designing an effective and attractive brochure for a tour
operator are as follows: Identification of factors affecting planning decisions: The main objective or target for
creating the brochure, information to be involved, and the period of time to design
brochure are some of the major factors that are being considered by the Trailfinders for
designing a brochure. Brochure format: While planning for brochure the format for the brochure should be
considered. Name of the tour company, destination explained, time of the tour,
transportation, cost involved and other factors should be taken into consideration for
making a format for the brochure (Cetin and Yarcan, 2017). Determine budget and target market: The budget of the company and its target market
can also affect the planning for designing the brochure. For determining the actual cost
that would occur through considering or preparing a budget. For selling the tour the
audience for the tour is been targeted.
 Stage and the time limit: For planning and designing the brochure, the time limit for
completing should be considered along with the stages that should be accomplished
within the time limit must be known for effective planning for the design of brochure
(Ledin and Machin, 2016).
3.2
Trailfinders and Thomas cook are the two different tour operators taken to determine the
alternatives for traditional brochure for advertising tour.
As online technologies is been developed there are new and improved methods for
promotions have been introduced. Such as online social media promotion, websites, e-brochures,
etc. With the help of e-brochure the tour operators can improve their communication with their
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customers, as it provides fast and effective communication and provides big opportunity to
attract customers and visitors and earn higher profits. With the use of e-brochure can save a lot of
cost involved in promotional activities than using other traditional methods. With e-brochure it is
easy for grabbing the attention of viewers through attractive prices and package offers (Sidorov,
2018). It helps to boost promotion on the other social or public sites, such as Facebook, twitter,
etc., helps in grabbing the attention of the public. Different sites such as YouTube allow the
company to easily upload different types of video brochures. The visual effect helps in taking the
various decisions related to tour by creating a clear picture of the destination in the mind of the
customers. The visual e-brochures also contains information such as, the prices as well as the
explanation of the destinations.
The best method of promoting the Trailfinders business is adopting e-brochure for online
advertising through websites and social media. Using e-brochure helps company to increase their
customer relations and hence improves productivity and profit earning of the company. By
adopting the e-brochure and the other online technologies the company can have an effective
promotion of their tour services.
3.3
The various methods of distribution used by Trailfinders for selling holiday packages for a
luxurious and adventurous tour package are online marketing, traditional brochure, telephonic
sales, direct sales, call centres, etc. Different methods of distribution for different types of tour
operators is been discussed below: Inbound operators: For Inbound tour operators, online marketing and online promotion
through e-brochures is the most suitable method of distribution, since the target client are
from outside the operator's county. (Kerzner and Kerzner, 2017). Outbound operators: Online and modern sales methods is the most suitable method of
distribution for outbound tour. Since these tour operators deal with multinational tours, it
uses various online communication techs such as internet mediums for advertising. Domestic tour operators: Since the targeted the consumers are local market or domestic
market, Domestic tour operators can adopt both traditional brochures as well as direct
sales and online marketing and promotion method of distribution of holiday packages. It
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provides customers the relevant information about the company and the tour programs
(Vellas, 2016).
 Ground operators: The most suitable methods of distribution for ground operators is the
new and modern methods as they act as agents. Since they co-ordinate between large tour
operators and foreign tour companies, they use methods such as internet selling, online
marketing and promotion, etc.
The appropriate method of distribution of a luxury tour package of Trailfinders is to use the
method of promoting through outbound tour operations. The tour is being promoted through
various online technology to attract customer for taking a luxury tour package.
TASK 4
14.1 Strategic decisions made by different types of tour operators
Tour operators have to make many strategic judgment regarding tour operations and tour
programs in tourism and travel industry. Strategic decisions helps to make decisions in respect of
market segmentation, value, user satisfaction through meeting the needs and requirements of the
consumers of target market (Becker, 2016). The different strategic decisions taken or made by
different tour operators that are Trailfinders and Thomas Cook are compare below:
Basis Trailfinders Thomas Cook
Pricing Uses visible pricing strategy Uses disguised pricing policy
Positioning and
Branding
Believes in satisfied customers and
also uses promotions through
different medias.
Promotions through mediums like
social medias, advertisement.
Product Choice Presented as per the interest of the
customer with different price
packages.
Decisions like locations and price,
package, etc are presented for choose.
Surcharge policy No hidden surcharge all are visible
and, in such way, that customer
feels no objection.
Surcharges are added that tourist or
customer have no objection.
Distribution Direct as well as indirect through Direct through advertising, website,
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decision third party such as retail or online
travel agency, etc.
social media, client referrals, etc.
24.2 Tactical decision which can be taken by selected tour operators in different situations
The tactical decisions are taken by the tour operators for the smooth and efficient running of their
business, regarding the day to day operations and functions. The comparison of various tactical
decisions taken by Trailfinders are as follows: Competition: The tactical decisions helps in eliminating competitors by conducting
appropriate market study and determining the competitors tactics for making counter
plans (Eugenio-Martin and Inchausti-Sintes, 2016). Price wars: Tactical decision helps to make price decisions by considering the
competitors price decision and evaluating different factor affecting price and applying
them for the operations. Tactical marketing: Decisions regarding the observation and studying the effect of
promotional and marketing activities and advertising strategies taken by the Trailfinders
and in order to increase the sales of the tour products and holiday packages making
changes in the existing marketing policies from time to time. Yield management: Decisions regarding profits in the tourism business along with re-
investment and to identify various aspects that affects the profit yeilding of the company
 Consolidation: Decisions regarding accommodation, transit, meals, etc. to be included in
a package keeping in mind the need of the consumers to whom the package (Buhalis,
2015).
Conclusion
From this project report discuss and analyzes the effect on the travel agencies and tour operators.
Proper and appropriate stages and timescales used for developing holiday can help the tour
operator for designing an effective holiday plan. Various tour operators use various methods of
contracting for identifying different element of holiday for effective holiday tour plan. An
effective planning decision for designing a brochure helps to create an attractive brochure for
increasing customers. Lots of alternatives can be used in place of traditional brochures. Through
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making a strategic decision the tour operators can make effective tour plans and helps to deal
with competitors.
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