Tour Operations Management Report

This report analyzes the effects of current trends in the tour operators industry, evaluates stages in holiday development, assesses contracting methods, calculates selling prices, and discusses planning decisions and strategic/tactical decisions by different tour operators.

Tour Operations Management
1

Contents
Introduction...........................................................................................................................................3
Task 1....................................................................................................................................................4
P1.1 Analyse the effects of current and recent trends and developments in the tour operators
industry..............................................................................................................................................4
Task 2....................................................................................................................................................8
2.1 Assess the stages and timescales involved in developing holidays..............................................9
2.2 Evaluate the suitability of different methods of contracting for different components of the
holiday and different types of the tour operator...............................................................................11
2.3 Calculate the selling price of a holiday from given information below......................................14
Task 3..................................................................................................................................................16
3.1 Evaluate the planning decisions taken for the design of a selected brochure.............................17
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............................................18
3.3 Evaluate the suitability of different methods of distribution used to sell a holiday for different
types of the tour operator and recommend the most appropriate for your tour package...................19
Task 4..................................................................................................................................................22
4.1 Evaluate the strategic decisions made by different types of the tour operator............................23
4.2 Compare the tactical decisions that could be taken by a selected tour operator in different
situations..........................................................................................................................................24
Conclusion...........................................................................................................................................27
References...........................................................................................................................................28
2

Introduction
In the reported study the positive and negative effect of present and current trends and growth
on the tour operators industry have been discussed in an effective manner. In simple words,
the tour operator is defined as a combination of travel and tour components to generate a
holiday package. This report includes the detailed information about the tour operations of
Trailfinders Ltd, Kuoni and Alfa Travels. The development of holidays is required to be done
in a systematic way. Trailfinders Ltd. is the UK and Ireland based Travel Company which
provides an unbeatable selection of holidays to their customers. Various techniques of
contracting for dissimilar constituents of the holiday are discussed in the report. The selling
price of the tour package along with price per person is calculated below. In addition to this,
the reported study also highlights the methods of supply used to trade a trip for various
categories of the tour operator. The tactical and strategic decisions are also prepared for this
reported study.
3

Task 1
P1.1 Analyse the effects of current and recent trends and developments in the tour
operators industry.
Analyse the effects of current
and recent trends and
developments in the tour
operators industry.
Introduction
Huge changes in tour
operation industry are due to
the sudden changes in tour
market. Changes are required
to be done in any of the
manners. Trailfinders Ltd. is
UK based tour operator
which provides a range of
holiday packages. The
current and recent trends of
tour operator industry have
positive as well as negative
impact on travel and tourism
sector. Trailfinders Ltd. had
been impacted by the
different trends and
development. With the
sudden increase in digital
technology, customers have
become familiar with the
latest booking methods of
Trailfinders Ltd. Travel
European and global link-
European and global link
helps in providing a
number of strategies which
help to provide a global
presence to enhance the
tour operator industry. The
European Union is the sole
market where no charges
are forced on import and
export of resources and
raw materials. The tour
operators industry can
easily trade their services in
different regions (The
Week, 2017).
Promotion-New and
innovative promotional
ideas help in attracting a
large number of customers.
The tour operator
industries are also using
Conclusion
The above leaflet explains
various effects of present and
recent movements in the
context of Trailfinders Ltd.
The digital technologies are
providing various advantages
to the development of
tourism industry. European
and global link assists while
trading of raw materials. The
sudden changes in the
organisational structure of
trade bodies give a positive
effect on the tourism
industry. The Travel
Association and other
government bodies are
providing funds along with
trading permission.
Responsible tourism is
widely used by the tour
operator industry for
enhancing the well-being of
host communities in an
effective and efficient
manner.
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bodies like The Travel
Association, Association of
Independent Tour Operators
and others also play a vital
role in providing funds and
resources for the
development and growth of
tourism industry.
Effects of trends and
development
Various development and
trends of tour operator
industry are as follows:
Trade bodies- Trade bodies
is an organisation created
and sponsored by
industries that operate a
specific business. Trade
bodies such as Federation
of Tour Operators, The
Travel Association provides
suitable resources and
funds for the development
of Trailfinders Ltd.
various techniques like
social media,
advertisement, and face to
face communication for
transferring of their
services.
Environmental awareness-
Environmental awareness
evokes the necessity and
responsibility of the
individual to respect and
preserve the natural world.
Travel and tourism sector
are very conscious about
the environment. They are
also developing responsible
tourism for their customers
in which the negative
impact will get minimised.
5

Structure of tour
operators- Changes in tour
operator’s structure assists
in increasing the
sustainability rate of
customers. The
organisational structure
can easily be developed in
an attractive way.
Technology- With the
immense increase in digital
technology, customers are
becoming much familiar
with the new destinations.
This helps in exploring
various features of
Trailfinders Ltd. The high-
speed internet allows for
fast communication in
which booking and other
activities can easily be done
in a minute. Trailfinders
Ltd. can do pricing
comparison with their
competitors in a matter of
seconds. One additional
challenge Trailfinders Ltd.
face is that some of the
travelers are doing online
research first. The negative
feedback from previous
customers can be
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responsible for
demotivating wide range of
customers (Travel
Technology & Solutions,
2018).
Progressive development of
marketing in the tourism
sector- Tourism is an
important economic
activity and continues to be
the fastest growing sector.
Marketing. Trailfinders
Ltd. is continuously
organising road shows all
around the world for the
promotion of their holiday
services (U and Joseph,
2011).
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Task 2
Introduction
This section of the reported study talks about the various stages and timelines used for
developing the packages. It is important to develop each and every step by analysing the
needs and demand of the customer. The stages include planning, preparing, pricing and other
phases. The selling price of each person is calculated below.
(Source: Reactor, 2018)
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2.1 Assess the stages and timescales involved in developing holidays.
Planning is defined as a process of organising the activities which are required for achieving
the organisational goal and objective in a systematic manner. The management of
Trailfinders Ltd. had recently developed an educational tour for adult students (over age
group of 18) from London, the United Kingdom to Brussels and Brugge, Belgium. It is
important that the development of holidays needs to be done before the deadline. The
proposed group size of students is 42 and the tour is for five nights. Following are the stages
and timescales involved in the development of an organised holiday:
Market research- Market research is an action for gathering information about the needs and
demand of the customer. This will be helpful in making an estimation of the current trends
and financial rate of holiday packages. Trailfinders Ltd. can easily be able to determine
weather condition along with the accommodation and food and beverage cost. They can also
hire professional volunteer who will be able to communicate with the customers. For an
effective market research, one month is required (Lumsdon, 2016).
Planning and scheduling- In the second stage, planning and scheduling process are done.
The gathered information regarding the holiday package is created by a personal expert. The
planning of holiday package includes financial, transportation, lodging, miscellaneous
expenses and food and beverage. The time required for planning and scheduling of holiday
package is 15 days.
Pricing of holiday package- The selection of appropriate pricing strategies helps in meeting
the needs of a market environment. Penetration and skimming pricing can be used while
developing the cost of packages. The low price of services during the initial phase will be
helpful in luring the customers away from the competitors. The pricing of holiday requires
approx. seven days.
Cooperation with the suppliers- In this stage, communication with the stakeholders and
suppliers are important. They are responsible for providing funds and resources for the
development of holiday packages. Cooperation with the suppliers will require three days.
Marketing- The marketing of services is important. It covers a wide range of public relation,
promotions, and advertising. In this step, the developed product and services are introduced
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and promoted to the target customers. Various advertising strategies can be used for the
promotion of the product. The organisation can also provide brochure and pamphlets to their
customers. The completion of this stage can be done within five days.
Execution of packages- In this stage, the tour operator can develop tour manual to their
customers. Practically, the tour manual includes the policies, guidelines for the tour
customers. The execution of packages can be done in approx. seven days (Lumsdon, 2016).
Timescale
Activities Duration
Market research 30 days(one month)
Planning and scheduling 15 days
Pricing of holiday package 7 days
Cooperation with the suppliers 3 days
Marketing 5 days
Execution of packages 7 days
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2.2 Evaluate the suitability of different methods of contracting for different components
of the holiday and different types of the tour operator.
Contracting is a voluntary arrangement between two or more parties. Different methods of
the contract are as follows:
Allocation method- In the allocation method, the tour operator company contract between
lodging house owners. This helps in booking the suitable rooms as per the needs and desire of
customers. The allocation method includes the booking of bus, trains, flights and another
vehicle for sight-seeing.
Ad hoc method- In the ad-hoc method, the planning and costing of services are based on the
daily activities made for the customers. In this type of contract method, tour operator contract
on discounted rates with hotels and transportation.
Split charter- In the split charter, the local and general customers are not able to book their
tickets. VIPs or other rich people are allowed to book their flights.
Fixed contract- Fixed contract generally last for a specific period. Travellers are not allowed
to cancel their tickets after booking.
Tour operators are responsible for providing traveling activities like flight booking, food and
beverage and others. The different types of tour operator are underneath:
Tour operators Description
Outbound operators The outbound tour operator provides
multinational tour packages to the customer.
They generally take residents of their own
place for visiting another country. The
outbound tour operator sells their tour
products and services to the customer who
wishes to travel in another region. They also
provide all the facilities like transportation,
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food, and beverage to their customers.
Domestic operators The domestic operators are also known as
resident operators. They provide trips within
the boundaries of the country. This type of
operator only fulfills the traveling needs of
their local customers. The customers who are
interested in national park tours and other
places can use domestic tour operators for the
further booking of their packages.
Incoming operators Incoming operators are also known as
inbound operators. They provide local trips
to the tourist who visits from another region.
This type of tourist generally makes a local
arrangement like drop service, sight-seeing
transportation, local guides and others. The
local guides are able to communicate in any
of the languages.
Specialist operators The specialist operators provide products and
services to the niche market that has interest
in the particular geographical area. They
offer new and developed holidays which are
untouched by the customers. VIPs and rich
people can only afford the holiday packages
of specialist operators (Cruise Job Finder,
2018).
Direct sell operators The direct sell operators sell the tourism
packages directly to their customer. The
additional commission of travel agents is
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reduced while using direct selling. In
addition to this, they also offer a wide range
of holiday packages to their customer.
13

2.3 Calculate the selling price of a holiday from given information below.
Details Amount in £
Per person cost= 96 euro is the cost of a
twin room (shared by two adults)
96*45*1.12
11,289.6
(96*42/2*1.12*5)
luxury coach bus cost comprises of two
drivers, tour manager, fuel and all road
and ferry taxes
11200
Cost of a tour guide £945
Total cost 16,983.40
mark-up 33%*17305.96 5710.966
Sale price 31,168
Adjustments-
Given exchange rate= €1.12
Selling price per person of overall tour= 31,168/42 = £742
The overall sale price of the tour package is £ 31,168
Each person is required to pay £742 to the tour operator.
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Conclusion
It has been analysed from the above study that stages and timescale plays a vital role in the
development of holiday packages. Different types of contracting method can be used
according to the customer segmentation. Per person is required to provide £742 to the tour
operator.
15

Task 3
Executive summary
This report is summarised of different planning decision required for the selling of luxury
holidays. Planning is generally made so that the customers can be able to enjoy the holiday
packages. In addition to this, various method of distribution can be used to sell holiday
packages.
Introduction
In this report, the planning decisions are taken from the selected design brochure. The
brochure is a way of attracting a large number of customers via advertisement and promotion.
Kuoni Travel is a tourism company headquartered in Switzerland. Thomas Cook Ltd. is UK
based Travel Company which provides domestic as well as international holiday packages to
their customer.
(Source: Turkish airlines golf, 2015)
(Source: Thomas Cook Group plc, 2015)
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3.1 Evaluate the planning decisions taken for the design of a selected brochure.
Brochure consists of relevant pictures and information in the context of holiday packages.
The management of Kuoni provides all the important data in their brochure. It is important to
do market research before the development of a brochure. The basic features which can be
focused while developing brochure are as follows:
Deciding the format- The formatting of the brochure is the only thing which helps in
attracting various customers. The content structure helps in attracting travelers of a different
region. The styling, paper size and quality of brochure are important while the development
of a brochure.
Target market and budget- The strategic planning of brochure includes target market. It
helps in knowing the production and distribution process of the brochure to the customers.
The overall budget for holiday package needs to be done by customer segmentation process
(Elliot and Litwin, 2016).
Creative brief- For an effective decision of brochure, the creative brief provides information
and also guides the customer about the packages. Creative brief clarifies the goals and
objective related to the brochure (Executionists, 2018).
Designing- The designing of brochure must be effective and efficient so that it can easily
attract a wide range of customers. It is important to use different visual effects along with
colors, font size, and style. Effective design of brochure aware the customers about the new
and latest holiday packages.
Uniqueness- The designing of the brochure needs be unique than the competitors. The
development of new content and uniqueness in the brochure helps in developing brand image
of the firm.
17

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.
The traditional brochure is defined as a thin magazine in which various pictures and
information are displayed for the convenience of customers. The substitutes to a traditional
brochure for different types of tour operators are as follows:
Social media- Large number of customers are using social media as a source of
communication from person to another. This helps in knowing the latest holiday packages to
the customers. Social media is the best way for the promotion of new and innovative tour
packages.
CD, video- CDs and videos are generally made by the combination of relevant pictures and
information. The management of Kuoni Travel group can provide CDs to their target
customers so that they will be to know the latest packages.
Internet- Tour operator can also promote their services online. Kuoni can also use their
official website for the launching of their new services. This is the best way for targeting a
large number of customers (Elliot and Litwin, 2016).
Television- Advertisement is a way to communicate via the audio and visual form. The
introduction of new product and services can be advertised on television. This helps in
increasing the sales rate in an effective manner.
Recommendation
The management of Kuoni can use social media as a source for an aware wide range of
customers. The travelers will easily be attracted via new and innovative images, information,
graphics, and others.
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3.3 Evaluate the suitability of different methods of distribution used to sell a holiday for
different types of the tour operator and recommend the most appropriate for your tour
package.
Different supply methods can be used by Kuoni and Thomas Cook Group for marketing of
the holiday packages. Customers can be attracted by brochure because it is the best way to
target tour operator market. Methods that can be used by Kuoni and Thomas Cook Group for
trading the holiday packages are underneath:
Methods Description
Direct sell Direct selling of product and service involves
an independent person for the selling of
packages. Tour operator can easily be able to
communicate with their target customers by
the door to door sales, network marketing.
Indirect selling, the tour operator determines
the response of customer in the context of
holiday packages. It also reduces the
additional cost of travel agent and promotion.
Agencies Travel agencies are responsible for providing
necessary travel arrangement for the
customers. Agencies easily aware the
consumer about the destination holiday
packages. Face to face communication with
the customers assists in knowing the needs
and behavior in the context of packages
(Fountoulaki, et. al., 2015).
Call centers The call center is an integrated office used
for transmitting and receiving of the large
volume of holiday packages by telephone or
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e-mail. The customers who are visiting the
company’s website on daily basis. Call
centers usually target these types of
customers. Kuoni and Thomas Cook are
hired different call centers who are
responsible for communicating with the
customers.
Internet The Internet is the global system used for
connecting customers all over the world. It
helps the customer to know about the latest
holiday packages. Kuoni and Thomas Cook
Group can also target customers by using
social media like Facebook, Google,
Instagram, and others.
Telephone The telephone is a telecommunication device
which is used to conduct a conversation
between two people. Customers can easily
solve their queries regarding holiday
packages. Tour operator industry can also
communicate with their target customers on
regular basis (Fountoulaki, et. al., 2015).
Recommendation
The above methods play an important role in the distribution process of service and product.
Direct selling and internet is the best method used for selling of holiday packages to the
customer. In direct selling, Kuoni and Thomas Cook Group can directly communicate with
the customers to know their needs and demand with respect to the holiday service.
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Conclusion
The above task explains the planning decision of Kuoni as well as Thomas Cook Group. It is
important to develop brochure in an effective and efficient manner. It helps in attracting
customers all around the world. The distribution method of holiday packages is also analysed
in above report.
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Task 4
Executive summary
For fulfilling the goals and objective, the management of Alfa Travel is adopting various
strategic decisions. This report is summarised of various tactical decisions taken by a tour
operator in different situations. In order to attract a large number of customers, Alfa Travel
can use pricing strategy, customer relation and another factor.
Introduction
Alfa Travel is UK based tour operator which provides a variety of holiday services to the
customers of North East, Midlands, South East North West, and Yorkshire & Humberside.
Various strategic decisions are developed by Alfa Travel for increasing the rate of customers.
Tactical decisions are taken by Alfa Travel for operating in a different situation.
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4.1 Evaluate the strategic decisions made by different types of the tour operator.
The strategic decisions are a long-term and complex decision which is responsible for
affecting the entire direction of the organisation. The strategic results made by different types
of tour operators are as follows:
Pricing strategy- Pricing strategy is made to attract a large number of customers. The price
can be set to maximise profitability and rate of customers. It can also be used to increase the
market share or entering a new market. Discount pricing strategy can be adopted by different
kinds of tour operator because it helps in determining the long-term plan of the firm.
Promotional strategy- The promotional strategies deals with one or two-way communication
with the customers. Promotion of holiday packages can be done on social media, internet,
Facebook, YouTube channels, pamphlets and others. Point of sales is a way of selling and
promoting a product or services in stores or outlets. This strategy is more convenience and
impulse than the other one (Hose, 2018).
Distribution decision- Distribution is the process of making a service available for the
customers. Direct distribution is the best strategy in which the product and services are
directly sent to the end customer. The additional cost of travel agent will be reduced.
Customer relations- Alfa Travel are adopting various techniques for an effective
communication between the customers. The services and plans need to develop as per the
needs and desire of customer including their personal and health issues. A good relationship
with the customer helps in increasing the growth and efficiency of services and firm as well.
The management of Alfa Travel can organise fun activities in the marketplace so that a large
number of customers will get attracted towards the latest service. Customer will also start
showing their interest in the product and services.
Seasonal aspects- Seasonal aspects include the peak and offseason of the holiday packages.
Alfa Travel can offer discount and additional benefit to the customer in their holiday
packages (Brandon-Jones, et.al. 2016).
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4.2 Compare the tactical decisions that could be taken by a selected tour operator in
different situations.
Tactical decisions are a short-term decision which tends to be more changeable. Effective
tactical decisions assist in increasing the profitability and durability of the holiday packages.
Alfa travel needs to focus on their goal, objectives, mission, and vision while implementing
the tactical decision.
Tour operator- Alfa Travel is one of the UK’s largest coach holidays. Alfa Travel covers the
customer of North West, North East, Midlands, South East and Yorkshire and Humberside.
They are offering quality value of the products and services to their customer.
(Source: Voucher Codes Pro, 2017)
Following are the tactical decisions taken by Alfa Travel in different situations:
Competition- Competition among tour operator industry is increasing day by day. Other
companies are providing holiday packages at a cheap rate for attracting a large number of
customers. The management of Alfa Travel can also adopt suitable policies in favor of the
organisation. This will be helpful in enhancing the quality level of services in an effective
way.
Price wars- The competitive price of the product are responsible for the conflicts within the
tour operator industry. Alfa travel can use penetration pricing strategy to attract customers for
new product and services. They can provide holiday packages without lowering the quality of
their services. This will be helpful in increasing the rate of tour and travel customers.
24

Fluid pricing- In the current era, fluid pricing is increasing on daily basis. Alfa Travel can
contact their suppliers for a wide range of fluid. Fluid pricing is a short-term revenue decision
(Gu, et. al., 2018).
Yield management- Yield management is a pricing strategy based on the understanding of
customer needs and demands in order to maximise the revenue rate of the organisation. In
seasonal pricing, the charging of different services and the product is based on the high and
low season. Alfa Travel can increase the cost of holiday package in peak time.
Discounting- Discounting is a process for determining the present value of a payment.
Customers only prefer buying services on sale or discounts. The discounting of product and
service sometimes affects the financial budget of the organisation. It is important to provide
offer by checking each and every requirement and resources within the firm (Miksen, 2018).
25

Conclusion
On the basis of above task, different strategies are developed in the context of holiday
packages. Tactical strategies help in attracting customers and increasing the brand image of
the organisation. The decisions are developed by a mass market tour operator along with the
niche tour operator.
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Conclusion
The above report provides a detailed study of tour operator industry. It is important to
improve the planning process of holiday packages. Various effects of current and recent
trends as well as development are discussed. Technology plays an essential role in the
expansion of tour operator industry. The development of holiday packages needs to be done
before the overall timescale. The contracting methods are used by different types of tour
operator including inbound, outbound, specialist, direct tour operator. A brochure is an
important tool which can be used for attracting a large number of customers towards the
packages. Customers are widely using social media as a source of communication. The
traditional brochures are overlapped by the new and digital brochure. Different selling
methods are discussed in the report. Tactical planning is short-term action or plan used in
different situation. At the end of the report, various tactical strategies have been discussed in
an effective and efficient manner.
27

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