Finance and Funding in UK Tourism

This assignment delves into the financial landscape of the UK travel and tourism industry. It examines various sources of finance utilized by organizations within this sector, such as equity issuance, debentures, leasing, bank loans, and retained earnings. The analysis highlights the advantages and disadvantages associated with each funding option, providing insights into the strategies employed to secure capital for growth and development in the UK tourism market.

Finance and funding in travel and tourism sector
Sources and distribution of findings for public and private tourism development
Travel and tourism is the most revenue generating sector in UK’s
economy, as it provides long term benefits to the nation. It is
essential to evolve various capital projects for overall growth &
vitality. However, development of capital project not only increases
revenues but also raise the number of tourists. Ultimately, it aids in
brining economic benefits for a nation as well as world wide.
Apart from this, ministry of concern department renders
financial support t welfare and advancement of travelling sector.
Below describe the main sources in relation to this like-
It refer as large amount of investment those are required to build,
add and modify a project. It is based on use of capital both in
financial as well as labour to begin or finish a program. It includes
acquisition of land or assets, lease of property or purchasing of new
equipment.
Cross railways project are contributing toward economic
development of boarder region by supporting rural tourism. Through
this transportation development there is huge change is seen in
accessibility and facilitating summer rides on historical trains at
boarder region.
Heritage interpretation is all about those information which are
communicated to its visitors as educational, natural like museum,
park and other. Integrated footpath development and improvement
of those areas would help people and company to put right foot in
correct direction as development of tourism sectors. Continuous
improvement is done to increase profitability.
These are the main source of finance are stated as under: -
Equity issue: - Equity shares can be issued to raise capital for the
organization. Equity shares are regarded as the most popular source
of finance for an organization. The main merit of equity shares can
be regarded as the non refundability of the amount of funds raised
through the issuance, the capital contributed through purchase of
equity shares are non refundable as the equity shares are
irredeemable.
Debentures - Debentures help in raising debt funds and the debenture
holders are regarded as the creditors of the company. Issuance of
debentures has got some merits, the debentures holders are fetched
with interest at a certain rate and the same is tax deductible,
debentures are regarded as a cheaper source of finance. Leasing: -
Its an indirect source of finance. Leasing is a process where the
owner of an asset, provides another person the opportunity to avail
the same on payment of lease rentals. The merit of availing assets on
lease is that the assets can be availed without paying the whole value
of the same.
Bank loan: - Commercial banks provide loans to different
organizations. The advantage of availing bank loan is that long term
loans taken from different banks are charged with a lower rate of
interest, the interest for loan paid to the bank is tax deductible.
Retained earnings: - This is regarded as one of the best source of
finance for an organization retained earnings is the portion of
earning that is ploughed back by the organization. The advantage of
retained earnings is that it can provide huge amount of earnings to
the organization as the organization can retain a huge portion of its
earnings and it does not create any debt obligation for the company.
INTRODUCTION