Tour Operations Management: A Comprehensive Analysis of Holiday Package Development and Strategic Decisions

This report delves into the intricate world of tour operations management, providing a comprehensive analysis of holiday package development, strategic decisions, and the evolving trends in the tourism industry. It examines the various stages involved in creating a holiday package, including market research, planning, contracting, costing, and financial evaluation. The report also evaluates the suitability of different contracting methods for holiday components and explores the roles of various tour operator types. Furthermore, it analyzes the planning decisions involved in designing brochures, assesses the alternatives to traditional brochures, and examines different distribution methods used by tour operators. Finally, the report compares the strategic and tactical decisions made by mass market and niche market tour operators, highlighting their approaches to pricing, positioning, and product development.

TOUR OPERATIONS
MANAGEMENT

Table of Contents
INTRODUCTION.........................................................................................................................2
TASK 1........................................................................................................................................3
1.1-RECENT AND CURRENT DEVELOPMENT AND TRENDS..................................................3
TASK 2........................................................................................................................................1
2.1- ASSESSMENT OF THE DIFFERENT STAGES AND THE TIMESCALES IN THE
DEVELOPMENT OF THE HOLIDAYS........................................................................................1
2.2- EVALUATING THE SUITABILITY OF CONTRACTING THE DIFFERENT COMPONENTS OF
THE HOLIDAY PACKAGE AND DIFFERENT TYPES OF TOUR OPERATORS.............................5
2.3- CALCULATION OF THE HOLIDAY PACKAGE SELLING PRICE...........................................7
TASK 3........................................................................................................................................8
3.1- PLANNING DECISIONS EVALUATION THAT is TAKEN BY THE TOUR OPERATORS IN
DESIGNING A SELECTED BROCHURE.....................................................................................8
3.2- ASSESSMENT OF THE ALTERNATIVES OF A TRADITIONAL BROCHURE USED BY THE
DIFFERENT TOUR OPERATORS............................................................................................12
3.3- DIFFERENT METHODS OF DISTRIBUTION USED FOR THE SELLING OF THE HOLIDAY
PACKAGE BY THE DIFFERENT TYPES OF TOUR OPERATORS..............................................13
TASK 4........................................................................................................................................1
4.1- STRATEGIC DECISIONS MADE BY THE TOUR OPERATORS............................................1
4.2- TACTICAL DECISIONS COMPARISON BY THE SELECTED TOUR OPERATORS IN
DIFFERENT SITUATIONS.........................................................................................................2
CONCLUSION..............................................................................................................................4
REFERENCES...............................................................................................................................5

INTRODUCTION
One of the complex and a dynamic business environment is the tour operations. There are
different travel and the tourism component industries that the tourism companies work
with and comply with the laws and regulations to deal with the various external challenges
and the influences in the tourism industry. The companies that purchase the different items
and products and make up an inclusive holiday package in bulk by combining the different
products and finally sell them to the customers is referred as the tour operators.
The trends in the tourism industry are continuously changing and various developments are
have taken place. It is essential that during the development of the holiday package of a
tourist destination various stages and timescales must be involved which are assessed in this
report. A holiday package has been developed in this report with the budget for the tour.
Effective planning and tactics are required before the designing of a selected brochure of an
organization which are evaluated and along with it the suitability for the alternatives of the
traditional brochure are assessed. Lastly, the various tactical decisions that can be taken by
the tour operators are compared.

TASK 1
1.1-RECENT AND CURRENT DEVELOPMENT AND TRENDS
The companies that offer a wide variety of
services to the tourists like the
transportation, food, accommodation etc.
are referred to the tour operators. The
supply chain of the tour operators is very
strong as it includes the suppliers, travel
agents and the consumers (Benur and
Bramwell, 2015. There are various roles of
the tour operators like the purchase of
the holiday components in bulk, branding
them into a single entity and offering
them to the public.
With the changing tourism processes in
the industry, there are four types of tour
operators like the inbound, outbound,
domestic and the specialist tour operators
that offer their services to the tourists
(Antonescu and Stock, 2014). Outbound
tour operators provide their services to
another country by sending the travellers
in that country. Inbound tour operators
fulfil the needs of the visitors of the
overseas in the UK. The tour operators
that provide the holiday packages to the
local residents of UK are domestic tour
operators and the tour operators that
carry the small number of tourists with a
lesser price of services are the specialist
tour operators (Lim, et al. 2017).
Figure 1: Tourists Operators Types
With the latest changing trends in
tourism, the face of the tourists is also
changing like the number of individual
travellers, independent travellers,
minority groups and the mature travellers
have been increased in the UK (Mowforth
and Munt, 2015). Some of the
advancements made in the tourism
industry are depicted below-
DYNAMIC PACKAGING
The travellers are now making use of the
internet and themselves research about
the holiday trips and the packages and
book their own travel arrangements like
INBOUND
TOUR
OPERATORS
OUTBOUND
TOUR
OPERATORS
DOMESTIC
TOUR
OPERATORS
GROUND
TOUR
OPERATORS

the travel, accommodation etc. A high
flexibility is offered to the people to
purchase their holiday packages directly
from travel agencies and in less price
(Sharpley and Telfer, 2015).
Figure 2: Dynamic Packaging
[Source:
http://univisit.com/Software/Dynamic-
Packaging.aspx]
ICT TREND IN TOURISM
There are various developments that have
taken place in the Information
Communication Technology like the
increases wireless networks, internet and
cell phones that have reduced the gaps
between the travellers and the tour
operators and they can now easily
communicate with each other (Giaoutzi,
2017). The search cost of the buyers and
their access to the markets have been
reduced. With the help of the internet,
the information about the new product
offering by tour operators can be
gathered.
WORLD WIDE WEB
The increased usage of internet has
improved the collaboration level between
the different travel agencies and the
service providers (Chon, 2015). This has
reduced the need for the pre-
arrangements made with the suppliers
and customized services and activities are
done with the help of the internet.
DESTINATION MARKETING
Now instead of the tourism marketing, the
trend of the destination marketing has
been evolved in the industry in which the
different tourist destinations, its features
and importance are being promoted to
appeal to the tourists (Manohar, 2016).
Figure 3: Destination Marketing
[Source:https://www.prnewswire.com/
news-releases/new-research-reveals-
how-destination-marketing-is-an-
unexpected-catalyst-for-employment-
economic-development-and-quality-of-
life-282130111.html]

INDEPENDENT TRAVELLERS
The tourists according to the recent
trends in the industry likes to travel
independently and gather and avails the
various services of the holiday packages
through the online sources. The need for
the tour operators by the independent
travellers is very less and they would like
to do everything on their own during the
trip (Ghosh and Siddique, 2017). The
independent travellers make use of the
internet-based travel wholesalers like the
Booking.com and Expedia to avail the
various services of tourism.
Figure 4: Independent Travellers
[Source:https://www.littlehotelier.com/
r/distribution/booking-sites/hotel-
target-international-chinese-travellers/]
MOBILE APPLICATIONS
The mobile applications of the tour
operators are in current trend in the
market and the mobile booking system
are used by the tourists to book the
holiday packages online which had made
their decision making easy (Antonescu
and Stock, 2014). The new technologies
like Android applications had made the
tourism services easy for the people.
ELECTRONIC PAYMENTS
The mode of the payments in the booking
of the tourism packages have been
changed before the people use to avail
the tourism services by directly going to
the tour operators but now the trend is of
digital payments (Manohar, 2016). The
payments are now done online with the
help of the advanced payment methods
like internet banking.
PRO-POOR TOURISM
This kind of tourism is used to provide net
benefits to the poor and it is utilized as a
strategic tool to alleviate the poverty
among the marginalised communities
(Ilavarasan, 2017).
NICHE TOURISM
The particular interests of the tourists are
now being fulfilled by the tourist in the
form of the niche tourism that includes
providing services in the agro-tourism,
dark tourism, eco-tourism, green tourism,
medical and sports tourism (Gössling and

Lane, 2015).The interests of the people of
the UK is more towards the niche tourism.
TECHNOLOGICAL ADVANCEMENTS
There are various technological
advancements that have taken place in
the tourism industry like – the increased
knowledge-based web pages, Online
World of Mouth, online travel guides,
information portals, Google Street View
etc. that are currently trending in the tour
operators sector (Leung, 2017).
Figure 5: Technological Changes
[Source:http://www.techbreath.net/4-
thrilling-upcoming-technological-
advancements-wait/]

TASK 2
There are various stages involved while devolving a holiday package within a given timescale
that has been explained in this report with the help of Gantt chart. Different methods of
contracting are there for the different components of the holidays and different tour
operators which are being evaluated. A holiday package and its selling price for the tour of
Bhutan has been prepared for a group of about 30 people by the Titan Travels famous tour
operators of UK.
2.1- ASSESSMENT OF THE DIFFERENT STAGES AND THE TIMESCALES IN
THE DEVELOPMENT OF THE HOLIDAYS
As the planning of holidays is a difficult process so it comprises of the different stages and
there are various arrangements that the tour operators have to make regarding the holidays
and secure their contracts with the suppliers (Antonescu and Stock, 2014). The development
of the holiday package needs to be completed at least 18 months before the actual
commencements of the tour. In this case study, the different planning stages of the Titan
Travels are depicted as below-
MARKET RESEARCH- There are different kinds of research that needs to be done while
planning the tour of the Bhutan which includes the economic research- current stability,
exchange rates of the country, demand research- checking the volume of the business of
the planned products and the competitor products, consumer study- including the
demographic markets interests and the activities of Bhutan, research of the competitors
prices and segmentation along with the research of the products and sales research
(Lamsfus, et al. 2015).
PLANNING AND SCHEDULING- After the market research, the decision about finalizing the
destination of the tour is taken. There are other factors also involved in the planning like-
best time of travel, standard accommodation, estimated passengers on the trip, attractions,

amenities and accessibility planning etc. along with the planning to meet customers’ special
needs (Beedie, 2017).
CONTRACTING- In the contracting the tour operators the Titan Travels need to book the
services 12 months in advance of the holiday season. It is essential that the Titan Travels
must estimate in advance the capacity of the tourist in advance to make contracts with the
airlines and the hotels. There are two types of contracts namely the ad-hoc and the fixed
contracts in which the accommodation is booked in advance and when they are actually
required and involve no risks (Lumsdon, 2016).
COSTING OF THE HOLIDAY- The final costing of the holiday package must be planned in
advance including the travel of the charter flights, room's allocation, food etc. An estimated
budget should be made in such a way that sufficient amount of profit must be attained after
taking out the money that will be spent on the tour of Bhutan (Semley, et al. 2016).
FINANCIAL EVALUATION AND PRICING- The cost of the holiday package on which it is going
to be sold to the tourists must be finally done after the complete financial evaluation. In this
stage the exchange rates, future selling price and finalizing the price takes place (Sharpley
and Telfer, 2015).
ADVERTISING- Once the holiday package has been prepared the most important stage is to
advertise the holiday package to the different tourist especially by analysing the interests of
the customers who are interested to visit from the UK to Bhutan. The advertising can be
done from various sources like the email, brochures, social media, newspapers etc. to
attract the tourists (Chon, 2015).
OPERATIONS AND EXECUTION- Once all the above stages of creating the holiday package
are done then it is essential to carry out effective operations for the execution of the actual
holiday trip that is done by the Titan Travels. There are some policies and procedures that
are formed and implemented throughout the beginning to the end of the tout.

POST TOUR MANAGEMENT- In this stage several report preparation and evaluation takes
place and it has been analysed that the tour planner has attained their goals up to
satisfaction level or not (Beedie, 2017).

GANTT CHART
A timescale has been prepared to analyse the different stages of the holiday package
creation and shown with the help of the Gantt chart for about 18 months.
TASKS MO
NT
H 1-
2
MO
NT
H 3-
4
MO
NT
H 4-
5
MO
NT
H 6-
7
MO
NT
H 8-
9
MO
NT
H
10-
11
MO
NT
H
12-
13
MO
NT
H
14-
15
MO
NT
H
16-
17
MO
NT
H
18
RESEAR
CH OF
THE
MARKE
T
SCHED
ULING
AND
PLANNI
NG
CONTR
ACTING
HOLIDA
Y
COSTIN
G
FINANC
IAL
EVALU
ATION
AND
PRICIN
G
ADVER
TISING
OPERA
TIONS
AND
EXECUT
ION

POST
TOUR
MANAG
EMENT
Figure 6: Gantt chart
2.2- EVALUATING THE SUITABILITY OF CONTRACTING THE DIFFERENT
COMPONENTS OF THE HOLIDAY PACKAGE AND DIFFERENT TYPES OF TOUR
OPERATORS
There are various suitability for contracting the different components of holidays that take
place in the tour operators industry which is depicted below-
ADHOC CONTRACTS- The contracts made between the tour operators to avail the various
services like the flights and the beds when required are the fixed contracts which are made
by the Titan Travels (Semley, et al. 2016). There is a less risk involved in such contracts but
the administration is costly.
FIXED CONTRACTS- The different services like the beds, seats and the rooms are booked I
advance in the fixed contacts and they are more advantageous to the supplier's as even if
the accommodation will not be sold still they will get paid. There is less flexibility in such
contracts.
TRANSPORTATION- Titan Travels need to allocate the seats on the flights in advance so that
the tourist does not face any kind of inconvenience during the time of their journeys to
Bhutan and customer remains satisfied (Duke, et al. 2015).
HOTELS AND ACCOMMODATION- Extra beds should be booked by the Titan Travels in
contracts and the prices must be varied from low to high according to the different
customers. These extra beds will help the tourist to sell their remaining beds at affordable
rates and better profits (Pencarelli and Dini, 2016).

Different types of tour operators in the tourism industry are mentioned below-
OUTBOUND TOUR OPERATORS- Outbound tour operators provide their services to another
country by sending the travellers in that country (Isabella, 2015).
INBOUND TOUR OPERATORS- Inbound tour operator fulfils the needs of the visitors of the
overseas in the UK.
DOMESTIC TOUR OPERATORS- The tour operators that provide the holiday packages to the
local residents of UK are domestic tour operators. They also guide the tourist during their
visits.

2.3- CALCULATION OF THE HOLIDAY PACKAGE SELLING PRICE
The calculation of the selling price of the Bhutan tour from London for 30 people for 5 nights
along with the various components is depicted as below-
COSTING COMPONENTS CALCULATION PRICE IN BTN
ACCOMMODATION AND
BREAKFAST
30*80*5 12000
GUIDE CHARGES 920
BUS CHARGE 8350
TOURIST DESTINATIONS 60
PRICE FOR 30 TOURISTS 2030
FINAL PRICE FOR 30
TOURISTS
23360
EXTRA MARKUP 30%
AFTER MARKUP PRICE 30368
PER PERSON COST 1012.26 BTN
CONCLUSION
Thus, the different stages of holiday package creation, different types of tour operators and
the selling price of the holiday package of Bhutan for 30 people have been calculated in this
report.

TASK 3
The review of the brochures and the planning issues in deciding the format of the structure
of the brochure are done in this report. The suitability of the alternatives of the traditional
brochure for different types of tour operators is assessed. The different methods of selling a
holiday package by the tow famous tour operators named Titan Travels and Trailfinders are
also evaluated.
3.1- PLANNING DECISIONS EVALUATION THAT is TAKEN BY THE TOUR
OPERATORS IN DESIGNING A SELECTED BROCHURE
There are various planning decisions that are involved in the selection of a brochure by the
Titan Travels and the Trailfinders are defined as follows-
COST- The first important decision regarding the brochure designing and selection is the
cost that needs to be spent in the production and distribution of the brochure. The cost will
include the printing cost also. Both the Titan Travels and the Trailfinders spends a lot on
designing an effective brochure (Heylen, et al. 2016).
DECIDING THE FORMAT- While deciding the format of the brochure there are various
features of the brochure that needs to be retaken care like the theme, front cover, content,
structure of the texts and proper use of the colours, usages of photographs, style of writing,
proper size and the paper quality (Junining, et al. 2017). Titan Travels and the Trailfinders
both use proper content, size and quality of a paper.
TARGETED MARKET AND THE BUDGET- The targeted tourists for which the tour has been
planned must be analysed by the Titan Travels and the Trailfinders and the cost required to
target the audience by the use of the effective promotions are estimated (Luo and Huang,
2015).

DETERMINING PRINT SPECIFICATIONS- The brochure designed by these two operators must
be of high quality. The enamel paper, flat finish, the lighter paper must be used to attract
the tourists. There should be effective photos and graphics used in the brochure.
TIMESCALE AND STAGES OF PRODUCTIONs-
Apart from the above-mentioned decisions, there are some other important decisions that
are required to be taken by the Trailfinders and the Titan Travels before the selection of the
brochure-
 The preparation of the timescale that will involve the departure date of the tour,
visitor attractions, transportation details along with the accommodation details to
be printed on the brochure (Beheshti and Zare, 2015)
 The currency exchange rate and the price of the tour
 Information about visa, health requirements and insurance details
 Day to day itinerary along with the information on entertainment programmes
The brochure designing of the Titan Travels and the Trailfinders are shown as below-

Figure 7: Titan Travels
[Source: https://issuu.com/marinema1202/docs/titan_worldwide_2017]

Figure 8: Trail finders Brochure
[Source:https://trailfinders.ie/brochures/brochure-request-form?order=B]

3.2- ASSESSMENT OF THE ALTERNATIVES OF A TRADITIONAL BROCHURE
USED BY THE DIFFERENT TOUR OPERATORS
There are various alternatives that are used by the tour operators in place of the traditional
brochure which is mentioned as below-
E-BROCHURES- These brochures are also famous as the direct mail brochures and are used
by the Titan Travels in which with the help of the emails they send brochures directly to a
large number of customers simultaneously. E-brochure is very cost effective approach and
most suitable replacement of traditional brochures (Heylen, et al. 2016).
ANDROID APPLICATIONS- The android applications is also a suitable alternative to the
traditional brochure and tourists are using the google play and easily shares their feedbacks
through the applications (Junining, et al. 2017)
LEAFLETS- Leaflets are one of the inexpensive and the easy to distribute method and are
used for special or the last minute sales by the tour operators. This method is used to target
a limited target audience and contains the basic information (Beheshti and Zare, 2015).
SOCIAL MEDIA- Social media is one of the other inexpensive approach and with the help of
which the information of the tour packages can reach quickly to millions of the potential
customers. This a promotional tool, a replacement for direct marketing.
PROMOTIONAL BROCHURES- Outbound tourists generally make use of the promotional
brochures over the traditional brochures like the Titan Travels for attracting a large number
of tourists for the attainment of the company aims and objectives.

3.3- DIFFERENT METHODS OF DISTRIBUTION USED FOR THE SELLING OF
THE HOLIDAY PACKAGE BY THE DIFFERENT TYPES OF TOUR OPERATORS
There are basically two types of distribution channels i.e., direct and the indirect distribution
systems and some of them are explained below-
WEBSITES AND SOCIAL MEDIA- The real photographs, tour descriptions, videos and prices
to the clients are provided to the tourists by the use of social media, internet and the
websites.
Facebook, Twitter are the important forms of social media and other than this the online
booking system can be directly used by the customers to understand about the holiday
packages (Alegre and Sard, 2015).
ONLINE TRAVEL AGENCIES- The list of the tour and the activities are listed by the online
travel agencies so that the customers can easily search and book the tours by just one click
and pay per click formats (Veal, 2017).
GOVERNMENT SITES- There are tourism websites of the local government and the tourist
organizations generally operates their own websites to promote their local tourism.
Government websites can be used by the Titan Travels to sell holiday package to a large
number of tourists.
The usage of the social media, internet are recommended to sell the holiday package of the
Titan Travels.
CONCLUSION
The effective decisions in the selection of the brochure and the methods of selling the
holiday packages are evaluated in this report.

TASK 4
4.1- STRATEGIC DECISIONS MADE BY THE TOUR OPERATORS
There are different types of strategic decisions like the pricing strategies, positioning and
image branding, choice of the product in relation to the customer portfolio and distribution
decisions (Nagle and Müller, 2017). The two operators and the strategic decisions taken by
them in order to find a viable solution to their problems are depicted below-
THOMAS COOK (MASS MARKET OPERATOR)
One of the biggest market tour operators is Thomas Cook in the UK that is taken several
strategic decision to attract the tourists by maintaining their sales rate and brand name of
the company. The company has a large number of customers in Greece, Spain, Portugal,
Turkey etc. for which they are designing large product and services (Li and Hunter, 2015).
Low-cost leadership and product differentiation are used by the Thomas Cook and effective
pricing strategy with discounts are given for the promotion and marketing to generate high
revenues. Different age group people are considered while developing the holiday package
which makes their marketing process quite effective.
COX & KINGS (NICHE MARKET OPERATOR)-
The people who want to explore various places of a particular place one of the niche market
tour operators Cox and Kings offers them a variety of tour packages. Competitive service
strategies and effective market strategist are utilised by the company to make a significant
value despite the high competition (Rottembourg and Masson, 2017). Various discounts are
also offered by company to make a better position in the market. The company applies the
concept of the marketing mix and take care of the product, price, place and promotion.

4.2- TACTICAL DECISIONS COMPARISON BY THE SELECTED TOUR
OPERATORS IN DIFFERENT SITUATIONS
With the changing market conditions the strategic e decisions taken by the Titan Travels
must also be changed and tactical decisions for the attainment of the short-term goals and
benefits must be taken. Some of the effective tactical decisions under different conditions
are stated below-
EXTERNAL FACTORS- Travel Finders sometimes gets affected by the changing political,
technological and the environmental changes in such condition the company applied the
laws and regulations of the green policies which helps them to gain a competitive advantage
in the tour operator industry (Maier and Ohara, 2017).
DISCOUNTS- In order to maintain the service price rates of the company with the changing
economic conditions and the exchange rates of the UK, the company offers various
discounts to the tourists so that they can attain high profits. Titan Travels can attain high
profits in the foreign exchange rates and economic conditions are in their favour.
COORDINATION- Titan Travels must properly anticipate the outcomes while taking strategic
decisions so as to take business effective decisions in the changing market conditions. In
order to coordinate with the customers facilities like free Wi-Fi, unlimited internet are
offered by the Titan Travels to their customers (Abrate and Viglia, 2016).

The decision making levels of the tour operators under different situations are depicted
below-
Figure 9: Decision Making Levels

CONCLUSION
The tour operator industry including the different types of tour operators are defined in this
present unit. The recent trend and the advancement of the tour operator industry are
described in detail in the form of a leaflet. A holiday package for 30 people to Bhutan has
been prepared and its selling price also has been calculated. The different alternatives of the
traditional brochures, methods to sell the holiday packages, planning decisions for the
selection of a brochure are evaluated. Finally, strategic and the tactical decisions made by
the different tour operators are evaluated and compared.

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