Tour Operations Management: A Comprehensive Guide to Planning, Contracting, and Distribution

This comprehensive guide delves into the intricacies of tour operations management, covering essential aspects such as planning, contracting, and distribution. Explore the stages involved in developing a holiday package, analyze the suitability of different contracting methods for various tour operator types, and evaluate the effectiveness of alternative distribution channels. Gain insights into strategic and tactical decision-making processes employed by tour operators to navigate the dynamic travel and tourism industry.

UNIT 14 TOUR OPERATIONS
MANAGEMENT
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Table of Contents
INTRODUCTION...............................................................................................................4
TASK 1- LEAFLET.............................................................................................................5
1.1 ANALYSE THE EFFECTS OF CURRENT AND RECENT TRENDS AND
DEVELOPMENTS ON THE TOUR OPERATORS INDUSTRY....................................5
TASK 2- WRITTEN REPORT............................................................................................8
2.1 THE STAGES AND TIMESCALES INVOLVED IN DEVELOPING HOLIDAYS......8
2.2 EVALUATE THE SUITABILITY OF DIFFERENT METHODS OF CONTRACTING
FOR DIFFERENT COMPONENTS OF THE TOUR HOLIDAY AND DIFFERENT
TYPES OF TOUR OPERATOR...................................................................................11
2.3 CALCULATE THE SELLING PRICE OF A HOLIDAY...........................................13
TASK 3- MANAGEMENT REPORT SUMMARY.............................................................15
3.1 THE PLANNING DECISIONS TAKEN FOR THE DESIGN OF A SELECTED
BROCHURE.................................................................................................................15
3.2 ASSESS THE SUITABILITY OF ALTERNATIVES TO A TRADITIONAL
BROCHURE FOR DIFFERENT TYPES OF TOUR OPERATORS AND
RECOMMEND THE MOST APPROPRIATE FOR YOUR TOUR PACKAGE............17
3.3 EVALUATE THE SUITABILITY OF DIFFERENT METHODS OF DISTRIBUTION
USED TO SELL A HOLIDAY FOR DIFFERENT TYPES OF TOUR OPERATOR.....18
TASK 4 MANAGEMENT REPORT SUMMARY..............................................................20
4.1 EVALUATE THE STRATEGIC DECISIONS MADE BY DIFFERENT TYPES OF
TOUR OPERATOR......................................................................................................20
4.2 COMPARE THE TACTICAL DECISIONS THAT COULD BE TAKEN BY A
SELECTED TOUR OPERATOR IN DIFFERENT SITUATIONS.................................22
CONCLUSION.................................................................................................................24
REFERENCES................................................................................................................25
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4

INTRODUCTION
In this assignment the important developments and trends in the tour operators industry
will be laid emphasis on together with the different aspects of the tour operator industry.
The different stages in the development of the holidays will also be laid out and the
brochure preparation will also be accessed. The selling price of the holiday trip will be
calculated from London to Brussels and Brugge in Belgium of 40 students. This report
will also help in analysing the strategic decisions that will be made by different types of
tour operators with a comparison of the tactical decisions for selected tour operator in
various situations.
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TASK 1- LEAFLET
1.1 ANALYSE THE EFFECTS OF CURRENT AND RECENT TRENDS AND
DEVELOPMENTS ON THE TOUR OPERATORS INDUSTRY
Travel and tourism forms a major
industry for a country as it has been
considered as the most revenue
generating sector for a country. There
have been many trends and the
developments in the tour operators
industry that Trailfinders will analyse
and its effects will also be analysed with
reflection to the current and the recent
trends (Horner and Swarbrooke, 2016).
There have been recent developments
and trends in this sector which leads to
intense pressure on the tour operators
in the form of competition which forces
them to design tour packages so that
the consumer’s needs are duly met.
After the WWII the tour operator industry
has been progressing a lot and with this
recent trends and developments have
been emerged that leads to new
expectations and the attitudes of the
tourists which significantly impacts the
tourism industry (Xiang, et al. 2015).
Some of the recent and current
developments and changes in tour
operator industry include the following:
Changing face of tourists
In the changing world the tourist’s types
are also changing. There is emergence
of many new types of tourist such as
mature travellers, individual travellers,
and minority groups and independent
travellers. This new trend of the
travellers will impact the industry as this
will lead to increase in number of
tourists (Mowforth and Munt, 2015).
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Technological advances
Due to the new technologies coming
into existence there are many advances
that affects the tour operator industry.
Through these technological
advancements now it is easy for the tour
operators to alter and tailor the holidays
and share the information to the
travellers through virtual means
(Mowforth and Munt, 2015).
Packaging
In this growing advancement era the
travellers are now using internet to carry
their research and makes their own
packages by arranging the airlines,
hotels, travelling through the help of
internet and this renders better flexibility
to them which helps in arranging better
tour package than a travel agency and
saves costs of travellers (Xiang, et al.
2015).
Integrated communication tool
There has been development of
integrated communication tool in the
tourism industry which helps in effective
marketing by utilising innovative
marketing tools that helps in reducing
the access costs to markets and helps n
reaching wide range of customers (Yan
and Ho, 2017). Through internet
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information availability s boosted and
the sharing information leads to better
processes.
World Wide Web
Internet has enhanced collaboration
level between the travel agencies and
other service providers by rendering
effective arrangements on time. This
also allows for better customisation of
the activities and the services that
render better customer satisfaction (Yan
and Ho, 2017).
Other Advances
There have been development of many
other technological advances which
includes information portals, mobile
apps, Google Street View, Internet-
based travel wholesalers and the online
word of mouth which leads to better
acuities and convenience to the
travellers in the travel and tourism
industry (Yan and Ho, 2017).
Thus with these recent and current
changes and developments the tour
operator industry is getting affected as
these developments have led to the fall
in the popularity of the tour operators.
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TASK 2- WRITTEN REPORT
In this report the stages that are involved in the development of the holiday for 40
students from London to Brussels and Brugge in Belgium will be discussed and will also
develop a time scale that will be followed in the holiday development. Through this
report an understanding will be gained on the different methods of contracting and its
suitability for different types of tour operators. At end of this report a selling price will be
estimated for this particular holiday using given information.
2.1 THE STAGES AND TIMESCALES INVOLVED IN DEVELOPING HOLIDAYS
There are several stages that are involved in planning and developing this holiday from
London to Brussels and Brugge which includes the following:
Market research
The stages involved starts with the market research of Brussels and Bruges in terms of
the economic conditions and the demand factors prevalent in that country. The market
research will also involve screening of the seasonal impacts and the seasonality of
demand in August 2019 (Dai, et al. 2017). Through the market research the luxury
travel will be estimated by understanding the product components and will identify the
best time for the sightseeing. Through the sales research the actions can be better
taken for increasing the sales.
Planning and scheduling
After the market research planning and scheduling will be carried out which will help in
deciding the best time to travel and locations that will be visited in Belgium? This will
also involve considering the amenities, attractions and accessibility for the students with
special facilities (Byrnes, et al. 2016).
Contracting
Now the tour operator will be evaluated that will be entered in the contracts with. As this
tour will begin on August 2019 so before one year the contracts should be made so as
to agree about the hotels and airlines.
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Costing
Then costing will be calculated of the tour planned so that the same can be
communicated to the prospective students after effective evaluation of the prices
(Giaoutzi, 2017).
Brochure and advertising
Then the step comes is of the brochure preparation and the advertising of the planned
holiday trip to the students so that the execution of the holiday can be ensured in
advance.
Execution
After all these stages final execution will be carried out in August 2019 which will run
according to the planned timescale of the holiday.
Post-tour management
This is the most important stage of the planning holiday as it will help in monitoring and
analysing the faults of the planning holiday so that these mistakes can never be
repeated in future (Boniface, et al. 2016).
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Timescale of holiday from London to Brussels and burgee in Belgium in August
2019
ACTIVITIES APRIL
-
MAY
2018
JUNE
-
JULY
2018
AUG
-
SEP
2018
OCT
-
NOV
2018
DEC
2018
JAN
-
FEB
2019
MARCH
-
JULY
2019
AUG
201
9
SEP
2019
Market
research
Planning and
scheduling
Contracting
Costing
Brochure
and
advertising
Execution
Post-tour
management
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2.2 EVALUATE THE SUITABILITY OF DIFFERENT METHODS OF CONTRACTING
FOR DIFFERENT COMPONENTS OF THE TOUR HOLIDAY AND DIFFERENT
TYPES OF TOUR OPERATOR
Competition has been increasing in recent times so it is better to outsource some
business operations so that company can perform efficiently. Main parts of the tour
holiday to be contracted are accommodation, carriers, ground operators, restaurants,
ground staff etc. Contracts are fixed usually one year before of the holiday season
(Noor, et al. 2016). Tour operators and travel industry have to make estimation on a
prior basis for making contract with airlines, restaurants and hotels.
Different types of contracts:
Fixed Contract: This contract aims at booking all rooms and seats in advance and also
the payment made in advance. Provider offers the fixed and specific package to
everyone which is having the fixed price. The main benefit of this contract is it is very
effective in the mass consumption. This offers the high discounts to the large group of
people and the mass number of booking that will offer many discounts (Ivanov, et al.
2015). Also the supplier will get the benefit of non-occupancy of the seats and
accommodations. Trailfinders has adopted this kind of contract due to its flexibility as
Trailfinders can reduce the prices as their own.
Ad-hoc contracts: Ad-hoc contracts is being adopted by the Virgin Holiday as this
contract is being contracted when there is a requirement of the beds and flights. As in
this contract there is no cost involved in it. Virgin Holiday faces the case of the
overbooking so they use this contract for the arrangement of the extra accommodation.
It is most popular among the tailor-made industries, luxury travel companies and
specialist travel industry (Shi, 2016).
Sale only contract: These contracts are costly and high in prices as compared to other
contract. These are adopted at the time of the peak season where there is a priority of
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things to be done and the service providers are in the benefit due to this prior needs.
Leisure time tours has adopted the sale only contract (Ivanov, et al. 2015).
There are different types of the tour operators:
Inbound tour operators: This kind of the tour operators are directly connected with the
tourists. And they take care of providing all services and facilities during their whole
journey. They provides services like entertainment, insurance services etc. Leisure time
tour is a type of the inbound tour operator. They focuses on providing the goods and
services according to the customers’ needs and wants (Noor, et al. 2016).
Outbound tour operator: This tour operators provides the services and offerings to the
individual or group of the host country and also to the another country. They creates the
holiday packages and sell the tour package to the potential customers. They prepare
the multinational tour packages and sell them to the domestic country for a particular
time period. Trailfinders is a type of the outbound tour operator.
Domestic tour operator: These provides the services to the host and home country of
the tour operator. These provides guidance to the people who use to visit in the host
and domestic country of the operator. These type of the tour operator provides services
to the local operators and prepares the contract on the basis of the customer’s choices.
Virgin holiday adopted this type of the contract along with the Ground operators (Shi,
2016).
Ground operators: This are the particular agency, service providers and operators who
use to do booking of the hotels and destinations etc. from their specific place. They
focuses on the appointments providing at a particular destination. They fulfill the need of
the large tour operators (Noor, et al. 2016).Virgin holiday and Trailfinders has adopted
this type of the tour operator.
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2.3 CALCULATE THE SELLING PRICE OF A HOLIDAY
Trailfinders focuses on the calculation of the selling price of the educational tour for 40
students. The tour is from London, UK to Belgium (Brussels and Brugge) and per
person cost has also been calculated as below:
Exchange cost of room for per person (€1.15= £1) = 90€ / 1.15€
Exchange cost of room per person = £78.26 (Supposed per day cost)
Particulars Cost Cost for 40
members for5
nights (£)
Cost per person
(£)
Hotel cost £78.26 per person
twin sharing
( 40*78.26*5)
15652
(78.26*5)
391.3
Luxury Coach’s
cost
- 7,400 185
Local Tour Guide’s
cost
- 800 20
Total Tour Cost - 23852 596.3
Margin of Profit
(30%)
- 7155.6 178.89
Actual Selling
Price
- 30737.6 775.19
Thus, the total and overall cost of the holiday tour package for 40 members = £ 23852
Margin of profit (30%) = £ 7155.6 and Profit margin per person = £ 178.89
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The actual selling price of the tour package =£ 30737.6 and selling price for one person
= £ 775.19
Thus on the basis of the given amount cost of the holiday, the selling price of the tour
package is £ 30737.6 and price of one person is £ 775.19
Conclusion: Thus it can be concluded that Trailfinders uses various stages for the
developing holidays and there are timescale involved in creating the holiday package.
There are also different contracts methods which are being selected by the different tour
operators. Further, they need to calculate the selling price of the holiday.
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TASK 3- MANAGEMENT REPORT SUMMARY
INTRODUCTION
As a part of the marketing Department team of Trailfinders after reviewing the brochures
and methods of distribution used by Virgin Holidays and Leisure time the planning
decisions and the suitability of alternative methods of distribution will be analysed and
evaluated for Trailfinders. At end different types of tour operators will also be discussed.
BODY
3.1 THE PLANNING DECISIONS TAKEN FOR THE DESIGN OF A SELECTED
BROCHURE
The brochures that sell luxury holidays offered by Leisure Time and Virgin Holiday are
collected and reviewed by Trailfinders which leads to discovery of the planning
decisions that are taken for designing a selected brochure which will be discussed as
under:
Fig: Luxury Holiday brochures by Leisure time and Virgin Holiday
Source: (Byrnes, et al. 2016)
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Tourism brochure design will be designed on the basis of the psychology of the
audience with a combination of colours, contents, images and many more (Horner and
Swarbrooke, 2016).
The planning decisions will include the vital decisions related to the time scale, format,
colour, cost, budget, print specifications and many more.
Cost
The first element that will be considered will be the budgeting of the brochure that will
be involved and spent on the brochure production and in distribution (Byrnes, et al.
2016).
Format
Next planning decision in brochures is the format decision which includes the theme
decision and the front cover which will be utilised for brochure preparation. Another
elements and factors that will be covered will include the selection of the content,
structure, images, writing style, size of brochure and the quality of the paper used in
brochure (Battour and Ismail, 2016).
The format will involve the following:
 The font will also be decided that is easy to read and attract the customers
 Then the fold of the brochure will be decided that may be multifold or no folds.
 Next decision will be choosing quality paper with shiny finishes that reflects
sunlight and that supports the publications.
 Then the photos and graphics will be selected that will communicate to the non-
visitor about the destinations and will help in effective marketing.
 Then the content of the brochure will be decided under three sections the first is
the cover that is front page and then the body of brochure and the back of
brochure (Mariani, et al. 2014).
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Thus these decisions will guide the planning decision while designing the luxury holiday
brochure by Trailfinders.
3.2 ASSESS THE SUITABILITY OF ALTERNATIVES TO A TRADITIONAL
BROCHURE FOR DIFFERENT TYPES OF TOUR OPERATORS AND RECOMMEND
THE MOST APPROPRIATE FOR YOUR TOUR PACKAGE.
Trailfinders, Virgin Holiday and Leisure time tour can use various alternatives to a
traditional brochures like CD-ROM, E-brochures, Internet, social media, radio, TV
advertising etc. Following are the alternatives and their suitability to the different type of
the tour operators:
INTERNET AND SOCIAL MEDIA: This is an effective media which can be used as the
alternative to the brochures. It will provide the better reach to their customers.
Trailfinders can use the internet and the social media for the promotion in the place of
the brochures (Mahamoud, et al. 2014). Moreover, the Facebook, Twitter, YouTube,
Instagram are the better suitable options for the Trailfinders as it will to increase the
awareness and sales of the tour package (Standing, et al. 2014).
ANDROID APPLICATIONS: Virgin holiday can use the android applications to a
traditional brochures. As various offers and services can be offered on the applications
for Android and applications for IOS also. This will help the customers to make bookings
instantly and check the details and offers at the time of the bookings.
OUTDOOR MEDIA: Leisure time tour can use the outdoor media in the place of the
traditional brochures. It will be very effective for the promotion of the tour package in
respect of the Leisure time tour. Billboards, TFL busses etc. can be used for the
promotion as an outdoor media.
E-BROCHURES: This can be used as the best suitable alternative for the Trailfinders
and other tour operators. This has been proved as the best alternative for promotion of
the tour packages for the various tour operators. As it contains short and precise
promotional message which is very effective and efficient. There is a trend of the E-
brochures in the today’s world.
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3.3 EVALUATE THE SUITABILITY OF DIFFERENT METHODS OF DISTRIBUTION
USED TO SELL A HOLIDAY FOR DIFFERENT TYPES OF TOUR OPERATOR
The distribution is important for the overall communications role and functions in the
marketing. It involves the channels selections and operations by which tour industry
communicate with their market, agents, and the suppliers.
The distribution system is the process of moving the product from the manufacturing to
the finished goods or the consumption stages. Methods of distribution is important for
the increasing the sales. The distribution channel will be selected on the basis of the
cost, efficiency and level and control of service. The costs includes the commission paid
to travel agents, inbound tour operators and tour wholesalers. There are various
distribution channels such as direct distribution system in which selling is done through
direct contact. Many tour operators adopts this type of the distribution channel as it is
time-saving and increases profits. Indirect distribution system uses one or two more
travel mediators or intermediaries. It has the lower price as compared to others (Li and
Hunter, 2015).
Following are the different methods for selling the distribution of the holiday package for
the different types of tour operators:
Social media and Websites: Social media is the best method of selling tour and
holiday package through websites of the company, online applications, and social
media like Instagram, YouTube, and Instagram etc. As online selling includes the selling
of the goods and services through the social media and Internet. Trailfinders can use
the social media and websites for the distribution of the selling holiday package
Online Travel Agencies: Online travel agencies are also the best method and
processes to sell the holiday. This involves listing of the tour activity on their website
and this will allow users to click and search through this. This is a like pay per click
system. Virgin holiday can use this type of the method as it will promote the business in
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a good way. Travel agencies also increase the bookings and revenue which is very
important for the success (Li and Hunter, 2015).
Telemarketing and bulk messages: It is also the best option of the selling holiday
package as it pitches the customers directly. Leisure time tours can also use the
marketing channels via audio communication like call centers, direct calling etc. ( Li and
Hunter, 2015). This can be used for the selling effectively the tour and holiday packages.
Direct selling: It is the effective distribution method for influencing the target
customers. Many tour operators uses this distribution method for saving costs as it
involves face to face communication which will focuses on the direct pitching to the
customers who are valuable and potential to the tour industry.
For the luxury tour package, the best appropriate method of distribution of selling is the
Online Travel agents. As it will help in increasing the sales and revenue.
Conclusion:
There are various stages involved in the planning of the decision for the brochures
selection. Every tour operator need to put many efforts for this and also the tour
operators should select the appropriate alternative to a brochure for the effective
promotion of the tour packages. Moreover, there are various different methods available
for the selling of the distribution of the holiday packages.
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TASK 4 MANAGEMENT REPORT SUMMARY
INTRODUCTION
This task throw light on the various tactical and strategic decisions which are being
taken by the various tour operators. An evaluation will be done by the different type of
tour operators for the different strategic decisions. Further the tactical decisions will be
evaluated by the different tour operators.
BODY
4.1 EVALUATE THE STRATEGIC DECISIONS MADE BY DIFFERENT TYPES OF
TOUR OPERATOR
Strategical decisions are related to the overall planning for the policy implementation.
Trailfinders need to understand the problem for the viable solution. Strategic decision
rarely have the one best solution. Strategic decision making involves the strategic
planning, performance and budget planning and performance evaluation. Strategic
planning involves the low-cost leadership, product differentiation and market focus
(Course, 2015).
Pricing strategies: This can be used by the Trailfinders for the determination of the
competitive pricing for the tour packages with the attractive offers and discounts. There
are various pricing strategies like premium pricing, cheap value pricing and value for
money. Premium pricing is used to set the costing and pricing above the market price
which will improve the quality and status of the product. Value for money pricing charge
medium prices for the product and services that will create the good value for this price
and money (Course, 2015). Cheap value pricing profits is low and profit is achieved with
high turnover.
Positioning and image branding: The positioning and image branding is the major
decision which can be taken by the Virgin holiday which will help in creating the brand
image in the customers minds. Virgin holiday can use the targeting, segmentation and
positioning for the positioning and targeting of the customers.
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Distribution decisions: Leisure time’s tour takes the distribution decisions for the
promotion and selling of the tour package which is being developed by them for
targeting the customers. This focuses on the handling queries and increasing sales.
Also it includes the delivery of the physical products to the customers and consumer
(Moutinho, et al.2018).
Product’s choice: All the tour operators prepares a portfolio for the holiday and tour
packages which is concerned with the demands and needs of the customers.
Customers are being allowed for the tour packages selection so that they can satisfied
by the various customization done for them (Course, 2015).
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4.2 COMPARE THE TACTICAL DECISIONS THAT COULD BE TAKEN BY A
SELECTED TOUR OPERATOR IN DIFFERENT SITUATIONS
Tactical decision are taken with the consideration of the implementation of the corporate
strategies. They are being made by the top level of the business department or unit and
the functional unit. These are semi-complex and medium term and includes some
uncertainty at the strategic level.
Following are the tactical decision taken by the Trailfinders and different tour operators:
Tactical responses: This decisions are taken for responding to the high completion in
the market of the tour and travel industry. Trailfinders need to take decisions for
responding the external factors like natural disasters and accidents. They also take the
decision for supporting the challenges in the organization and financial crisis (Veal,
2017).
Tactical pricing: Virgin holiday prepares the short term pricing strategy which aims at
the facing the competition and entry into the market. Virgin holiday makes the strategic
pricing. For example, setting of the prices for garbing shorter term sales opportunities
(Veal, 2017). Fluid pricing is also used by the Virgin holiday for selling a holiday
packages in a cheap prices and increasing the prices afterwards.
Tactical Marketing: This involves the implementation of the 7p’s so that the company
can promote their tour packages effectively and efficiently. Tour operators prepares the
holiday packages as the product and set the prices, after that it focuses on the
promotion of the product through various marketing channels and distribution.
Tactical Planning: It is used by the Leisure tour packages for the shorter time period. It
involves the way of achieving the strategy made for the attainment of the goals. It also
focuses on the planning of the overall strategy for the company. Planning involves the
outlines of the strategy like how it will be implemented and applied. It also aims at the
resources utilization (Veal, 2017).
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Conclusion:
Tour operators need to take any decision for the smooth function and operation of the
business. As there are various decisions which are short term and long term. Strategic
decision is being taken for the long term and implementation of various strategies.
Tactical decisions are being made for the smooth functioning of the day to day activities.
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CONCLUSION
The above assignment focuses on the tour operators industry in the travel and tourism
industry. There are various stages and timescales involved in the developing holiday.
The analysis of the recent trends has also been made in the tour operator industry. The
various types of the tour operators has also been explained with the different methods
of contracts. Further the decision taken for the planning of the selected brochures
design has been evaluated. Also the alternatives to the traditional brochures and
methods of selling has been explained. It also focuses on the tactical and strategic
decisions made by the tour operators.
1.
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