Tour Operations Management Report

This report provides a comprehensive analysis of tour operations management, focusing on Trailfinders Ltd. It examines the stages involved in developing holiday packages, analyzes strategic and tactical decisions made by different types of tour operators, and discusses the importance of effective decision-making in the tourism industry.

Tour Operations Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Covered in Leaflet..................................................................................................................1
TASK 2............................................................................................................................................1
2.1 Assess the stages and timescales involved in developing holidays..................................1
2.2 Suitability of different methods of contracting for different components of the holiday.4
2.3 Selling price of a holiday from given information...........................................................5
TASK 3............................................................................................................................................6
3.1 Evaluate the planning decisions taken for the design of a selected brochure..................6
3.2 Suitability of alternatives to a traditional brochure for different types of tour operator. .7
3.3 Suitability of different methods of distribution used to sell a holiday for different types of
tour operator...........................................................................................................................8
TASK 4............................................................................................................................................8
4.1 Evaluation of the strategic decisions made by different types of tour operators..............8
4.2 Comparison of the tactical decisions in various situations.............................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Tour operation management is an most important aspect in which a company create
numerous holiday packages with detailed informations that are related to a particular tour or
holiday. It is essential for an organisation to include different type of benefits in their tour
packages which can attract costumers from all around the world in order to increase sales
turnover of tour operations. This report is about Trail-finders Ltd. which is a travel company
with approx 31 centres in UK. This was founded in October 1970 by former SAS- officer Mike
Gooley. Present study has been conducted on, current trends and development prevailing in tour
operator's industry and their direct and indirect on business units. Furthermore, this report
different stages and timescales that are included that are involved in the creation of holiday
package. (Amirudin and et. al. 2017). In addition to this, decision making that are related to
distribution methods and destinations in order to sell holiday packages and contract that are made
to service providers and tourists are also covered in this project. Effective utilization of
digitalisation and various other different strategies of promotion are included in present case.
Lastly, assessment of systematic and strategic tactical decision which is necessary for Trail-
finders to take into consideration in order to satisfy customers in effective way are briefly
discussed in this report.
TASK 1
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2
TOUR OPERATIONS MANAGEMENT
Operating a tour is the imperative task in a tourism industry. The tour
operators are those individuals who are engage in the business process
of providing services related to merging tour destinations and different
tourism packages into an overall package. This package includes
accommodations related to sight-seeing, campaign and travelling etc.
All these accommodations are designed as per current perceptions and
trend prevailing in market. There are four most important types of tour
operator which are mentioned below:
Inbound Tour Operator – These tour operators has converted all the
touristic resources of country into a scalable commodity, which help
them in making the historic image of country. These operators are
generally locally based and they work to promote the destination as a
whole top interested travellers. These occurs when an international
tourists or non-resident visits a particular country. These tour and travel
operators use to make packages individually or with the collaboration
with foreign tour operators. They do not use to work with other agents
and do not need distribution partners for creating and promoting
packages.
Outbound Tour Operator – These types of tour operators take
residents from one country to travel in another country. They conduct
tours for an individual or a group of peoples of their own country. They
provide the packages that emphasize upon sending the people of native
country to foreign destinations. They act as the mediator between the
operators of the foreign country and the tourists.
These operators continually demand for travel services within its own
market and will focus on identifying travel opportunities and creating
products and services for these travellers going to other countries.
Domestic Tour Operator – These are the operators, that make
facilities for transport, sightseeing, accommodation,
entertainment and other tourism related services for domestic
tourists. These tour operators work within the national
boundaries of a country. These are the tour operators who use to
perform their activities from their own premisses an by the help
of other travel agents. Leading tour operators has their main
focus on the global market where rates are higher and in UK,
USA, Japan, India and China, many tour operators are very good
in domestic holiday packages.
Specialist tour Operator – These are the tour organisers that
organises the tours according to the demands and choice of
customers. Transportation, locations, food, facilities, sight-
seeing and accommodation features all get selected according to
the requirements of customers. They all use to provide many
packages mainly for special or untouched destinations. These are
also known as tailor-made operators because of the option of
customisation that they offer to the tourists. These operators
design a package, keeping in mind the special features of some
dream locations and the customer choice
Trail finders Ltd is a specialist tour operator having a customer
centred approach. This approach will benefit them to gain more
competitive advantage as company is having the advantage of
modifying their holiday packages as per according to
perceptions of customers and market trends.

3
TOUR OPERATIONS MANAGEMENT
Current and recent trends and developments on the tour operator’s
industry
Over the years, there have been many changes in tourism industry.
Some of the changes that have taken place in Trail Finders Ltd. are as
follows: -
• Integration (Horizontal and Vertical): One of the major
developments in tourism business over past some years is integration.
It is of two types: vertical and horizontal. Vertical integration is
typified by one firm engaged in different parts of production. This
means the collaboration of associated business organisations and
service providers operating at different levels on the other hand
horizontal integration refers to integration of two companies operating
in similar business line in order to overcome competition. This is a
consolidation of many firms that handle the same part of the production
process. By engaging in integration, the management of Trailfinders
Ltd. can gain a strategic advantage to sustain in market for long period
of time.
Technological Advancements: As with the rapid advancement in
technology tourism industry also boomed at rocket speed. Tour
operators nowadays are taking advantages of conducting their bookings
on cell phone applications and online portals. Trailfinders Ltd. also
offers the option of booking through their site.
Tourists now can easily access online portals and websites of tour
operators and done their bookings or cancelations via internet.
Company management has modified their brochures in relation to tour
packages that can attract large base of consumers over their websites.
Impact of Inflation: Country economic condition affect development
and growth of tourism industry in both positive and negative way.
Inflation effectively impact on income level of individuals.
Maximisation in the overall income base of people results in higher
level of living standards thus this benefit industry to attract more
attention of customers towards them.

TASK 2
2.1 Assess the stages and timescales involved in developing holidays
The process of developing and planning a tour package and thereby satisfying the
travellers can be formed as a series of stages starting with market research and lasting with actual
operation on a tour (Das and Hanaoka, 2014). So as the present report is having a luxury coach
and educational tour for adult students (over 18 age group) from London, the UK to Brussels and
Brugge, Belgium by the tour operator of Trailfinders Ltd. Thus the tour operator will adopt
certain stages which are explained below:
 Market Research - The tour operator of Trailfinders Ltd carries out an in-depth research
of choice and preference of adult students and also the latest trends and development in
tourism industry. Also research is carried out by the enterprise to gain knowledge about
the practices in which competitors are engaging for conducting a tour to Brussels and
Brugge.
 Planning and Scheduling - Planning needs to be done with regards to tour locations such
as Brussels and Brugge, accommodation, dates, number of tourists, amenities to be
provided, transportation etc. Also, a proper schedule is maintained by the tour operator
such as this is already decided that the tour will be in summer vacation in July 2020 for 5
nights in Brugge, and the tour is of 50 Students per group and the facility of twin room with
breakfast will provided to the students.
 Contracting - A contract will be signed between the service providers of transportation
and other conveniences and Trailfinders ltd. Also, sometimes company signs a contract
with the travellers.
 Costing - This relates with the cost of holiday package. Cost includes pick and drop fare,
fees of tour guide, travel tickets, accommodation, travelling, food and other facilities
provided by Trailfinders Ltd. such as a special rate for the group has been proposed by
Grand Casselbergh in Brugge of £80.59 per person for a twin room with breakfast. The
price 54-seater luxury coach is £6,949 and that includes two drivers, a tour manager, fuel
and all road and ferry taxes. Visitor attractions charge £41.29 per person. The cost of a
local tour guide is £811.31 for the duration of the tour. Trailfinders adds a mark-up of
28% to cover selling and administration costs and profit.
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 Financial Evaluation and Pricing - Evaluation and pricing comprises of the calculation
of expenses and margins by the management of Trailfinders Ltd.
 Creation of Brochure - A brochure is designed providing information about the cost,
destinations covered and facilities that would be provided by Trailfinders. The brochure
is creatively developed to catch the attention of people towards the package.
 Advertising - Various strategies are adopted by Trailfinders to promote its packages. The
various methods include online promotion, print media like leaflet, circular, newspapers
and pamphlets (Filby, Stockin and Scarpaci, 2015).
 Operation and Execution - This stage involves the steps like taking deposits, booking
tour tickets etc. This is very important for the company as it determines strategies or the
action plan for execution of package.
 Post Tour Management - This stage arises when travellers are back to pavilion. This
includes customer feedback in relation to the package and services provided during the
tour. This also involves the paying off of dues by company to service providers.
5

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2.2 Suitability of different methods of contracting for different components of the holiday.
It is very important to specify the conditions of the tour before the beginning of package,
so the contracts are signed between two or more parties that agree upon the conditions mentioned
in the contract. A contract will be signed between the service providers of transportation and
other conveniences and Trailfinders Ltd. Also, sometimes company signs a contract with the
travellers. There are different types of contract in tourism industry which are outlined below:
 Fixed contract: These are the contracts that involve the terms about the prior bookings
that have been done for flight and hotel bookings for the students in relation to tour for
Brussels and Brugge. These contracts are suitable for Domestic tour operators as this
helps them in making arrangements in accordance with the actual requirements and
demands of students (Holland and Leslie, 2017).
 Allocation contract: This contract is signed between hotel manager and tour operator.
About the information of number of beds to be booked, so that the remaining rooms can
be sold by hotel management. This contract is also signed for booking the seats of flights.
Often, these types of contracts are entered by large scale tour operators for
accommodation while planning for the facilities to be rendered in the holiday package.
 Ad-hoc contract: These contracts are signed for over booking of flight seats or beds so
that the tourists do not face any problem during the tour. This type of contract is suitable
for specialist tour operators like Trailfinders as in this, the cost of facilities is set as per
the activities which are carried out in the tour either hourly or daily. The contract
facilitates Trailfinders in managing its financial resources for future needs (Newsome,
Moore and Dowling, 2012).
2.3 Selling price of a holiday from given information
For tour operator, organising selling price plays vital role as it includes cost of each and
every item which is covered during entire trip. In this scenario, 50 students per group are going
to Brugge for 5 nights. Trailfinders needs that luxury coaches must be created and with that
educational tour for students (United Kingdom to Brussels and Brugge) must be organised in
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summer vacations. Grand Casselbergh Hotel in Brugge has offered special price for groups. It
includes 89 euros for twin room with healthy breakfast for a person. In this context selling price
of tour is shown below:
Particulars
Room and Breakfast Cost (89*50) (Note 1)
Luxury Coach Cost (Note 2)
Visitor Charges Cost (45.6*53) (Note 3)
Tour guide cost (Note 4)
Total Cost
Selling Price of package (14711.8*100/72) (Note 5)
Spot exchange rate = 1.14 € = 1£
Therefore 20433.05 € = 20433.05/1.14 = £ 17923.72
Therefore selling price of tour (in £) = £ 17923.72
Price per person= 17923.72/50 = £ 358.47 or £ 358 (Round off)
Notes:
1.Assuming 89 euros cost is for entire 5 nights room and breakfast in Brugge
2.Assuming all the cost relating to luxury coach for two drivers and tour managers are
recoverable from student group only.
3.Assuming visitors charges of two drivers and tour manager are recoverable from student
group.
4.Assuming tour guide cost are recoverable from student group.
5.Assuming 28% mark up is on selling price
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TASK 3
3.1 Evaluate the planning decisions taken for the design of a selected brochure.
Brochure refers to leaflet or pamphlet or template used for promotional activities and
inform customers about benefits involved in that. It is designed by tour operator to create
awareness about tour among customers. This strategy is used by tourism industry to attract
customers so that they can go for packages being offered by them (travel and tourism industry).
Brochures helps to build suitable environment for communication as information is given to
customers related with tour package and it also helps to create brand image of specific
organisation within particular industry. Trailfinders have designed their own brochures which are
available in online as well as offline form (Shyju and Lama, 2015). .It provides details about
complete organised tour or tour package. For building brochure certain planning is done by
organisation and decisions are taken for implementation of that plan. It has been below: Designing: This factor includes layout or structure of brochure. It should be made in such
a way that it can attract large number of customers. It must seem appealing to their
customers. Design can include creativity and innovations either they can be folded or as a
straight paper. Cost: It is important factor which needs proper planning. This has to be determined
before any other phase. It includes cost of designing, paper, printing and distribution and
if online medium is chosen then cost is about designing and its distribution in web. Format: It includes factors like colour of paper, writing style, size of text, contents which
are required to be mentioned on it and many more (Sroufe and Joseph, 2017). It also
includes topic, which is mentioned on it and is of foremost important, as it will define
that whether customers will read it or leave it. Topic covers information which is needed
to be told to customers. Content is directly proportional to its topic. Again it will be as
what all is needed to addressed as per topic. Graphics or pics about particular location
seems more appealing to customer. By this Trailfinders can have sufficient amount of
travellers. Target market: Trailfinders focus on students as they are keen for adventurous trips as
per that they find out target market and builds their budget. It will also help Trailfinders
to design their brochure.
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 Print specification: It includes all what is to be included in it and in which colour it is to
be written and schemes to be used in it (Su and et. al., 2014).
 Timescale and stage of production: Design depends on stage of production. Suppose if
company is on its initial stage, then designing is done in such a way that it seems
appealing to customers. But when company who is having strong customer base then for
them just information given on brochure will be enough.
3.2 Suitability of alternatives to a traditional brochure for different types of tour operator
With the progress in technology, it has been observed that traditional methods of
marketing are not fruitful. One of those methods is creation of Brochures. Various new methods
of advertising have arisen over year which can be adopted by Trailfinders to increase their
business of travel and tourism. Online promotion through call centres is also a way to reach
customers directly. Trailfinders can also create audio and video leaflet and place it on their
website to gain more attention from people. Trailfinders can also promote its packages through
newspapers and pamphlets. Also, E- mail marketing can be adopted by management of
Trailfinders. Nowadays, advertising agencies can also be helpful in promoting the sale of
Trailfinders tour packages. Social media is yet another factor that acts as a driver for increase of
revenue and margins for the company. Thus, through digital technology, tourism industries can
appeal to a wide base of travellers or tourists. (Yan and Ho, 2017).
Audio and video leaflet method would be the most suitable method for the tour from UK
to Brussels and Brugge. Trailfinders should also place this leaflet on their website to gain more
attention from people. This method is beneficial for Trailfinders because in today's life, people
are getting attract by graphics tools as written things are not considered so important for them.
3.3 Suitability of different methods of distribution used to sell a holiday for different types of
tour operator
There are different types of distribution methods that can be used by tour operators in
their tour packages for telephonic sales, direct selling and advertising. Mentioned below there are
suitability of various methods related to distribution for tour operators are described in brief:
 Direct Distribution: This method of distribution include, direct dealing of tour
operators for tour packages to customer. In this there is no involvement of a third person
or a mediator. Domestic tour operator can effectively take advantage of this method as
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most of their consumers are domestic residents. This will benefit tour operator to make
direct contact with them and explain their packages to them in a detailed manner.
 Online travel agencies: In this mode of distribution, a mediator is present between the
consumer and tour operator who effectively communicate with the customer and
persuade them in order to make them buy a holiday packages of company. These
agencies provide information related to tour pricing and packages on their websites and
modify them accordingly as to attract large number of costumers. This method is most
suitable and appropriate for specific tour operators as they provide their services only in
specific location.
 Visitor information centre: It is a real or physical spot that provide necessary and
required information to tourist and visitors. This method can be more effective to
Inbound Tour Operators, as they indulge in providing holiday packages to people who are
mainly belongs to different countries.
Online Travel agencies method is most suitable for luxury tour package as this method is
for specific tour operator and Trailfinders Ltd having specialist tour operators. This method is
suitable for this tour because it's having fairly low cost way to list the property and rooms. Along
with this, impartial reviews on online travel sites gives new customers the confidence to book.
TASK 4
4.1 Evaluation of the strategic decisions made by different types of tour operators
Strategic Decisions are long term, complex decisions made by top management of the
organisation. These decisions will affect the entire direction of the firm. This is the process of
creating an organization's mission, goals and objectives (Zhou, 2015). This is essential for every
organisation working in tourism industry to remain aligned with the growth and development in
industry and modifying their processes as per the recent trends. Following are some of the
strategic decisions made by different tour operators are given beneath: Pricing strategies used by Trailfinders Ltd.: The decisions regarding the price of
package is done while keeping in mind the cost of designing and promoting a package
offered by Trailfinders Ltd., By adopting the discounting price strategy, Trailfinders Ltd.
became able to offer high discount to the customers. This discounting pricing strategy
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would help Trailfinders Ltd. to attract the customer to their designed packages and
thereby provide company various competitive advantages in the market.
Bundle prices : This is technique of pricing, where organisation sale their products in a
bundle at a cost which is lower then the separate cost of that product.
Economic prices : This is a pricing technique which is used by organisation for making a
moderate price of products. This is used in markets which have tough competitions like
tour and travel, food, and clothing.
Skimming prices : It is a type of pricing technique, which help organisations in keeping
the price of their products little higher as compared to their competitors. This is effective
for those organisation which have customer base with loyal consumers. Pricing strategies used by Thomas Cook : The packages of Thomas Cook are available
at reasonable prices so they can stay relevant and be competitive. Given today’s
economic scenario, travelling on holidays is still a luxury and people have to save
exclusively for years to be able to afford a holiday abroad for their family. Currently the
company has adopted a half way premium pricing to attract the right type of customers.
During off seasons the company provides good discounts to meet targets. Image positioning or Branding done by Cost-saver: An inbound tour operator of United
Kingdom i.e. Cost-saver having a good image in marketplace because of the strategy that
this company has adopted. Company has used CSR activities as their approach in order to
build up their products. This basically help them in attracting a large number of
customers to prefer their package. Image positioning or Branding done by Trail-finders Ltd : Trail-finders also has the
good image and branding positioning in the market, as company can greatly benefit from
knowing what their customers think and how the company might improve products or
services.
 Product choice strategy of Globus: A United Kingdom's famous outbound tour operator's
fundamental strategy is that to develop packages (suitable holiday package) based on
seasons and preferences of customers as well. In order to gain knowledge related to
trends and customer's needs Globus basically do the study and analysis of customer
portfolio in order to improve profit margins.
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 Product choice strategy about Trail-finders Ltd : Establishing the product choice first,
the trail-finders keeps everyone focused on the work as this matters the most. The
company tells the team where the product is headed and what needs to be done to get
that. Distribution channel strategy adopted by Thomas Cook (International tour operator) :
Basically there are two types of distribution channels which are basically used by
Thomas Cook. Direct selling is one of those types comprising direct interaction with the
target audience. Second is the indirect selling which includes the use of services of
mediators. This strategy is used by Thomas Cook where it selects distribution channel
which seems suitable for the business and target customers and this varies with the target
market for different type of tour operators.
 Distribution channel strategy about Trail-finders Ltd : This strategy is about how
effectively trail-finders gets its product to consumers and end users. Trail-finders sells
their products directly to the customers as a direct distribution or through intermediaries
as indirect distributions.
4.2 Comparison of the tactical decisions in various situations
It is essential for tour operators to adopt various types of decision making strategies for a
successful completion of their tour package. Company can take advantage of tactical decision for
their medium term decisions in order to implement strategies in their tour. Tactical decisions
effectively considered by Trailfinders are briefly described below: Tactical responses – It is necessary for tour operators to implement effective decision
and adopt formative decision making in their workplace that are related to internal and
external environment of tourism industry. Trailfinders managers recognised the
importance effective decision making in their organisation and then formulated
systematic strategies as per according to current industry scenario. (Dhiman, 2012). Tactical pricing – There are some effective tactical decision which a company have
taken to gain market competencies. For example, modifications in their tour packages
according to situations prevailing in country economic condition and strategic policies
related to pricing of other rival entities. Trailfinders can adopt Surcharge pricing policy to
have more competitive advantages against their competitors.
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 Tactical marketing - It includes, systematic formation of attractive advertising and
effective techniques of promotions that a company implement in their process of
considering competition business and industry. Numerous strategies have been adopted
by Trailfinders some of that includes traditional brochures, online marketing and booking
over internet.
CONCLUSION
As per the above mentioned report it has been concluded that, with a successful planned
tour of the student going to Brussels and Brugge. The above presentation of the report covers all
aspects of a tourism industry like Trailfinders Ltd.
This report had analysed the current recent trends prevailing in industry and its direct
impact on tourism business development. In this project, different types of stages that are mainly
involved in systematic process of composing tour package.
It will benefit in effectively development of knowledge and the ways in which different
types of decisions are made. Various methods and ways of distribution with their suitability for
different kinds of tour operators are also mentioned in this project which will help in improving
quality of various facilities offered by tour operator to their consumers. In addition to this,
information related to tactical decisions made by tour operators in different scenarios that can
arise in a market are also covered in this project. This will help them to take effective decision in
proper time frame which results in profit and product maximisation.
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