Tour Operation Management: Functions, Roles, and Impacts

This report explores the functions and roles of tour operators, the structure and scale of the tour operating industry, and the impact of integration on tour operators' operations. It also discusses the various stages in creating a holiday package and provides a critical review of luxury tour programmes. Additionally, it highlights the tactical and strategic decisions made by TUI to improve customer experience and business performance.

TOUR OPERATION
MANAGEMENT
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Contents
INTRODUCTION................................................................................................................................................................................................................................3
PART 1.................................................................................................................................................................................................................................................3
Function and roles of tour operators.................................................................................................................................................................................................3
Structure and scale of tour operating industry-................................................................................................................................................................................4
Impact of integration on each operations of tour operators-............................................................................................................................................................5
PART 2.................................................................................................................................................................................................................................................6
Various stages in creation of holiday package..................................................................................................................................................................................6
Methods - How to cost a package holiday-......................................................................................................................................................................................7
PART 3.................................................................................................................................................................................................................................................8
Critical review of the range of luxury packaged tour programmes..................................................................................................................................................8
PART 4.................................................................................................................................................................................................................................................8
Tactical and strategic decisions made by TUI..................................................................................................................................................................................8
CONCLUSION....................................................................................................................................................................................................................................9
REFERENCES...................................................................................................................................................................................................................................10
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INTRODUCTION
Tour operation management refers to the most essential activity in business specially in travel industry, operation management along with talented
peoples helps to managed tour operating industry and its operations (Belady and et.al., 2014). Consumer behaviour, tourism planning and development,
marketing and financial management influence tour operator’s business as well as performance. The present report is based on TUI as tour operator company in
UK, it explains different functions and roles of the range of tour operators, structure and scale of tour operating industry. Impacts of integration on scale and
structure of large mass market and independent tour operations and steps in creation of holiday package, functions and role of each stage including timescales
and how levels of development differ between tour operators. It justifies step how to cost package holiday and critical review on range of luxury package and
recommendation for improvement in context of meeting target consumer needs. Furthermore, tactical and strategic decision made by organization to continually
improve clients experience under several situations.
PART 1
Exploring the Tour Operating Sector
Function and roles of tour operators
Tour operators usually combines tour and travel elements to create the holiday package, they produce and advertise brochures to promote its services or
products as well as itineraries within marketplace. Tour operators provide specific and general advice to customers about various travel destinations which is
essential for clients. It has to establish linkages along with principal suppliers like hotels, guide and escorts, airlines, tourist transport operators etc, in order to
designing and planning package, they play important role within travel and tour industry and has several functions that they run effectively. There are the 4
types of tour operators,
Roles and functions of different tour operators-
 Inbound operators- This kind of tourism is known as incoming operators and international visitors who are local and residents of UK rather than being
travel and visited for purpose of tourism. Inbound tour operator’s role is to make plans, provide tour planning, coordinate reservation, offer itinerary
confirmation and payment of travel preparations on the behalf of its overseas customers such as retail or wholesaler travel agents. They also provide
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guidance to local peoples or assistance to those clients who arrive its nations. Its function is to create holiday packages involving local tourism ventures,
including transportations providers, hotels and tour operators.
 UK Outbound Operators-Outbound tour operator role is to give transportation facilities to those domestic people or individual who needs to travel
from one country to other, they take resident people to foreign nations for organized travel (Caber and Albayrak, 2018). They play essential role in
tourism sector as take peoples from one nation to another, they take travellers all across the world. Local peoples book outbound tour operators which
allows them to get each and everything as they want in one convenient location.
 Ground tour operators- This type of operator is referring to as destination management organizations, handling agencies and reception operator in UK,
their role is to offering land arrangements and services at particular destination, Ground operators support in providing facilities to big tour operators
who do not has the local branch or office at destination place.
 Domestic tour operators-This sort of tourism is known as peoples visiting destinations within its nations boundaries who travel for tourism, in simple
words domestic tour operators is the types of tour organizations have business functions and several operations within country boundaries. They provide
packages holiday to residential peoples; the role of domestic operator is to provide transportation facility to local people those who need to travel. Their
function is to offered different types of tour services are national tours, hiking etc., they serve its best services to visitors such as food and beverage and
accommodation.
 Independent Specialist tour operators- They designs and make holiday packages keeping in view particular requirements of various market segments
of clients, their role is to provide exclusive packages and created adventures package to peoples.
Structure and scale of tour operating industry-
Tour operating industry makes all the arrangements for its clients in term of transport, excursions and accommodation, large, mass market and independent
specialist tour operators perform under this sector since for so long effectively. Their size and structure are based on areas where they perform and business
expansion procedure. According to World Tourism and Travel Council, tour operators generated £7.8 Billion for global GDP which make it one of the world’s
largest and fastest growing industry.
Bases Mass market operators Independent specialist operators
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Structure and scale Mass market operators provide large number of
holidays for clients and consist of the best-known
travel and tourism sector such as Thomas cook.
They put all different elements together that make
the holiday and then sell them as packages to
customers or travel agent. Size of this industry of
market vary because in many nations mass market
tour operators’ is cannot adequately evaluate at
current.
TUI is one of the independent tour operators, they
provide their services to many peoples as compare
to mass market operators. TUI is travel PLC
company, they operate in 180 nations and serve 30
million clients as compare to others.
Impact of integration on each operations of tour operators-
Integration is the latest trend within market or development I tourism industry, it plays significant role in drastic improvement as well as bringing positive
development in tourism sector, it directly effects on structure and scale of independent and large mass market specialist tour operations. Due to some changes in
technology, and fall or rise of inflations make negative impact on tour operators as well as their operations. For example, Mass market tour operators serve their
services in many nations in which fall of inflation effect on their performance and the way they run business effectively (Habib, Lee and Memon, 2016).
According to inflation they need to make some changes within its structure and provide low cost services to customers which is not beneficial for them and
decrease financial performance. Due to advancement in technologies, it directly effects on independent operators, they run along with existing technologies but
after advancement in technology, its current structure and operations affected the most. They need to modify entire working structure and provide training to its
workers according to new technology in order to sustain for longer term period. But on the other side it makes positive impact as if TUI adopt new technology
which help to increase profitability and productivity.
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PART 2
Various stages in creation of holiday package
Large mass market and independent tour operators is responsible for making the best package and must considered all the essential things within it.
There are number of levels included in creation or development of package holiday which assist travel companies such as TUI in delivering quality products
and facilities to travellers or visitors (Kim and Chang, 2014). TUI is an Ango German travel and tourism organization, they serve its facilities to number of
peoples effectively, they own 6 European airlines and biggest holiday fleet in Europe and many tour operators based in UK. They contribute in GDP and CSR
and also play essential role in customer satisfaction services. Tour operators faced along with intense international pressure in form of business competition and
to cope with that, TUI design and develop tour packages to meet consumer requirement. The package is created in context of Holloway, the package is created
for adults’ students from UK visiting Ghent in summer. There are stages in creation of package holiday,
Research- it is the main and most essential stage of creation holiday package for students, before making package understating and analysing
destination and tourist market is important. Market research considered to be crucial level, where it is needed by marketing manager in TUI to execute market
investigation in order to gather more information about chosen destination, it is one of the crucial actions while planning holiday package. They conduct offline
market research which is cost effective, but consume a lot of time, on the other side many tour operators as well as TUI now are using online research which is
beneficial and useful while develop package holiday.
Negotiation- tour package for students require involvement of several facilities so it is essential to negotiate with various services providers like service
providers of accommodation, food, transportation, guide etc, this negotiation take around 3 months of time. Negotiations has to be made with overall
prospective vendors or suppliers that is associated with tour operators. The main objective is to retain and engage in best deal with suppliers.
Administration – before creating holiday package for students TUI need to hire appropriate administrative staff, so it is easy to conduct market research
and accomplish work successfully. TUI tour operator or manager cannot be able to conduct tour, that is one of the reason they hire and recruit talented peoples
who are friendly and talented, possess good organizational and communication skills.
Marketing- Publicity and marketing of the tour package is essential as this is what prospective clients and stimulate tourists around the world to travel
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to specific place or select particular package. In simple words, marketing or promotion is creation of demand that outcomes in satisfying clients and
accomplishing corporate objectives.
Developing tour marketing plan- Tour operator need to focuses on developing tour marketing plan in order to achieve business objectives and
marketing goals.
Post tour management- after completion of tour package of students, tour management and its team members take feedback in context of facilities
offered to them so it helps TUI to make its services better than before.
Time scale
Nature of tour- Educational tour
Location- London to Belgium , Ghent
Date of beginning of tour-1. 7. 2019
Duration of tour- 7 days
Number of tourists- 50
Tourist destinations to be visited- Ghent
Type of tourists- Students
Cost of tour- 125 euros including breakfast.
All the stages is different between tour operators for example in bound tour operator only provide their facilities to local peoples rather than outbound
tour operators serve across the boundaries.
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Methods - How to cost a package holiday-
Package tour, package holiday or vacation comprises accommodation and transport advertised and sell together by vendor known as tour operators.
Rental car, outings during holiday, food and others services included in process of cost a package. Hotel cost 1896, supplement 592.5, transportation 1000, tour
guide cost is 200, total cost is 3688.5.
Mode of transport is term used to distinguish substantially various modes of conveyance, there are the different modes of travel or transport are water,
air and land which included railway or rails, off road transport and road.
PART 3
Critical review of the range of luxury package tour programmes
Types of packages available in tour programmes and in tourism industry, it assures clients desires and needs is meet. Adventure tours, group tours, city
or regional tours and fully escorted tours as well as special interest tours.
Special interest tours- this type of package is designed around specific interest area which include food, arts, sport, agricultural or cultural. It include
an expert guide who related to theme of tour for example, art expert accompanying an art tour or gardening expert accompanying the garden tour.
Adventure tours package- it is designed to permit peoples to participate in areas of interest for experience based and length of tour, it generally
requires the certain level of fitness, sometimes it modified to meet with needs of customers depend on other traveller as well.
Regional or city tours- this tour package usually last for one full day or less, it follows fixed itinerary and visit filed of interest in particular place
whether that is historic, cultural and religious, meal or refreshments is often included.
Group tours- It refers to pre and fixed arranged itinerary, they often take place only dependent on number of travellers, it requires the certain range of
travellers in order to go ahead or it become financial price rather than profit.
Fully escorted tours package- it is one of the best luxury packages for individual or solo travellers and especially men and women travelling alone, this
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kind of tour package sense of protection or results language and cultural barriers. This type of tours is often some what educational, companion providing
historical, local and cultural knowledge or give peoples more worthwhile understanding and experiences of nation or placed visited.
Fully escorted tours package is appropriate for meeting group of students needs as target market, with the help of the best package they can be able to
know more about different places and gather information based on chosen destination.
PART 4
Tactical and strategic decisions made by TUI
Retain consumer and gain their trust is one of the major responsibilities of tour operators which help to increase productivity and profitability rather than
before within its business. There is different strategic decision which has been taken by TUI to expand their business and to improve customer experience and
in term of sales productivity, uniqueness etc. strategic and tactical decisions in context of improving several situations or thing within business.
Promotional strategies- Promotional strategy is one of the best strategies which assure external and internal stakeholders that TUI design and create the
best holiday packages to its clients in term of sustainability, better quality services and uniqueness. They follow all the government policies in context of
advertisements rules which is beneficial and effective for business success and growth. It assists company management to select appropriate promotion and
advertisement method to advertise its packages and facilities in market which garb the attention of investors as well as customers more rather than before.
Management must decides effective tool to promote and advertise holiday packages because overall profit of company is depend on promotional strategy, TUI
promote services or products through social media sites and other social media tools in order to increase productivity and profit margin.
Customer relations- TUI should try to improve relations with its customers by providing better services and quality products to them, they must
provide discounts offer to retain them with company and design different strategies to improve and develop great relation and ensure stakeholders to
diversification. With the help of developing good relationship with clients they can be able to retain all of them and spread positive impact upon other mind set
which is effectively beneficial for overall business growth and success within Tourism industry.
Competitive pricing strategy- this strategy involves analyses of competitors pricing strategy, TUI evaluates costs charged by its business competitors
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for package and compare price then set their own prices. They offer unique and quite different services to customers, in order to sustain for longer term of
period, they must add some more facilities rather than other tour operators in order to attract peoples to buy holiday and vacations packages. This type of
decisions facilities TUI get clients loyalty in highly competitive environment (Andersson, Manfredsson and Lantz, 2015). With the help of competitive pricing
strategy company can be able to assure that its holiday packages is quite different from the others and perform well in term of increasing sales and profitability.
Seasonal pricing- Company also follow the concept of seasonal pricing which is beneficial for improving or increasing flexibility. Management take
decisions in context of package prices. During off season, they provide seasonal discounts and make some flexibility in their pricing structure and also provide
discounts to peoples, they can tries to offer cost effective packages to visitors in order to fulfil their needs and thus management of TUI reduces cost of
particular period of time, seasonal policy attracts more consumers and increase revenue of TUI.
Exploring new business- TUI must explores new places and defines packages to these new destinations, it contributes to keep interest of clients as most
of peoples are interested in exploring new destination or places.
Utilization of resources- TUI tried to utilize resources in effective manner to generate revenue, they need to provide quality goods or facilities to
consumer by effective use of resources. Management of company designs strategies and tactics in way that optimum utilization of resources is being taken out
and benefits business the most. Company design holiday packages according to wants and needs of consumers which is suits budget of peoples, it is more
beneficial for overall business and help to improve clients experience. They need to avail additional facilities in vacation and holiday package which support to
attracts more rush towards firm.
CONCLUSION
From above it has been concluded that inbound tour operator, outbound, independent, domestic and other tour operators run its business effectively and
play role within travel and tourism sector in order to provide better facilities to local and residential peoples. TUI identifies the major tour operator in UK
including its market segment environmental awareness among tourism sector. This report discusses stages included in developing holiday packages and provide
guidelines how to cost a package effectively. With the help of great strategies and tactics company can be able to sustain for longer time period and assure
employees, management and competitive about increasing profitability and productivity. Business will adopt several strategic decisions in order to compete in
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market, retain and improve consumer experiences and take tactical decisions assist management to manage and handle overall business functions and activities.
Furthermore, there are range of luxury holiday packages in which company chose the appropriate one for meeting its target market wants and needs.
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