Key Principles of Revenue Management in Travel and Tourism Industry

Travel & Tourism
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Examine the key principles of revenue management for the specific industry.....................3
P2 Revenue management tools to generate and maximise profit...............................................4
P3 Review the different stages of the HR life cycle within specific travel and tourism job
role, and their importance for retaining and developing talent...................................................5
P4 Develop a performance management plan for a specific travel and tourism job role, .........6
TASK 3............................................................................................................................................7
P5 Explore specific legislation within the specific travel and tourism industry should work
and adhere ..................................................................................................................................7
P6 Illustrate how company, employment and contract law has a potential impact on business
decision-making within specific travel and tourism industry.....................................................8
TASK 4............................................................................................................................................9
P7 Different types of financial statements and reporting mechanism for organisation within
the travel and tourism industry....................................................................................................9
P8 Importance and value of budgets for controlling business performance and identifying
variances ...................................................................................................................................12
CONCLUSION .............................................................................................................................13

INTRODUCTION
Travel and tourism Industry is currently growing and experiencing a unprecedented
growth and thereby helping in the growth of the economy. This is one of the most attractive
industry in the world which is inuring huge profits. Travel and tourism industry provide various
services in the form of food and beverage, accommodation and transportation facilities. The
main aim of the industry is to provide efficient services to its traveller to provide them long term
experience. Moreover there are various travel agencies which provides budgeted packages to the
travellers regarding their requirements and demands. The report is based on Thomas Cook which
is travel and tourism related company offer various services such as holiday packages, cruise
lines services as well as food and beverage facilities to the travellers, headquarter in London, UK
(Buhalis and Amaranggana, 2013). This project will throw highlights on sales and revenue
management within the specific industry. It also determines HR Life Cycle as well as legislations
and ethics in travel and tourism.
TASK 1
P1 Examine the key principles of revenue management for the specific industry.
Travel and Tourism is the most attractive industry which targets large number of customer
by providing services according to the demand of the travellers. This consist of various
departments such as sales, finance ad marketing in which employees work effectively towards
enhancing the brand image of the company. It is necessary for the company to provide necessary
training to its employees so that work can be carried effectively and efficiently. Therefore
Revenue Management is a vital concept within the travel and tourism sector. Revenue
Management is concerned with analysing he past record or the current level of bookings from the
individuals so as to forecast the demand appropriately in to maximise revenue for the specific
industry. Rationale behind revenue Management for Thomas Cook is to analyse the data and
anticipate demand of the customers thereby providing services according to the demand of the
travellers. This assist the company to maximise revenue as well as provide effective services to
the travellers and also assist the manager of Thomas Cook to manage the availability of hotel
room, transportation and food and beverage facilities, herby enhancing brand image of the
company.

Key Principles of Revenue Management which can be applied to Thomas Cook are
discussed as follows-
 Market Segmentation- It is concerned with segmentation of the consumers that are
availing the services of specific travel and tourism sector. Customers can be classified on
the basis of their characteristics and attributes which assist Thomas Cook to provide
services according to their demand. This assist respective industry to provide various
travel packages to the customers according to their budget. Thereby helping Thomas
Cook to effectively manage the revenue and target large customers. This assis t in
effective revenue management (Evans, Stonehouse and Campbell, 2012).
 Demand Forecasting- It has a greater impact on the revenues of the specific industry.
As the high demand forecasting will lead to conservative inventory and low demand
forecasting will lead to aggressive inventory controls. This factor affects the revenue of
the company. Thereby Thomas Cook should effectively forecast the demand of the
customers and make the service available so as to maximise the revenue.
 Overbooking- This factor has a greater impact on the revenues of the industry as it
determines the manager within the respective company regarding future sales of its
respective company and indirectly aims at generates at maximising revenues and profit
margins for the company. Therefore manager at Thomas Cook should book the hotels
appropriately and enhances its revenue.
Therefore this are the effective principles of revenue management which assist he company the
company to enhance business and maximise revenue in their long run.
P2 Revenue management tools to generate and maximise profit
Travel and tourism industry is the fastest growing industry which provides efficient
services to the travellers, thereby meeting up their satisfaction level and enhances brand image of
the company. It s therefore necessary for Thomas Cook to effectively manage revenue of the
company by applying various revenue management tools. Revenue Management is defined as
the application of the disciplined analytics and predicting the behaviour of the consumers to
make sure that products are available according to demand and thereby maximising revenues for
the company. Moreover with the help of revenue management tools respective industry should
adopt effective pricing strategy so as to meet the demand of different categories of customer.
During off seasons prices for the travel packages are low as compared to peak seasons (Evans,