Impact of Covid-19 Pandemic on TUI Group’s Business Environment

This report analyzes the impact of Covid-19 Pandemic on TUI Group’s business environment. It discusses the internal and external factors affecting the company's operations, the impact of the UK government's recovery plan, and the STEEPLE factors affecting TUI Group’s operations.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
Section 1..........................................................................................................................................3
Presenting business overview......................................................................................................3
Section 2..........................................................................................................................................4
Impact of Covid-19 Pandemic on TUI Group’s..........................................................................4
Section 3..........................................................................................................................................5
The impacts of Covid – 19 and the resultant UK government’s recovery plan..........................5
Section 4..........................................................................................................................................6
The impacts of STEEPLE factor on TUI Group’s operations.....................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................1

INTRODUCTION
Business environment refers to total of organizations, people and other forces that are
outside the business but might majorly affect the operations of the company in long run. Also,
the present report is based on the TUI travel agency groups that is one of the leading tourism
company and is highly specialized in providing various tour packages to large number of people
living in different parts of the world. Furthermore, study will identify the impact of external
factors on working of the business. Also, macro environmental factors are one that are present
outside the business and are completely out of control but indirectly affects the working on large
scale (Shen and et.al., 2018). Moreover, the report will also identify various internal factors such
as finance, material and human resources etc. that creates problems in working if not analysed
and rectified on right time. Furthermore, internal environment of business is one that is affected
by choices, decisions and activities taken within the organization and hence top managers take
special measures to analyse internal factors on timely basis. Lastly, study will identify impact of
COVID, recovery plan and certain recommendation that cited firm might use so that business
would gain success and growth in the future in the best possible manner
Section 1
Presenting business overview
TUI is travel agency group that is highly known for its services and products that it offers
in various markets. Furthermore, this group owns the chain of hotels, cruise lines and hotel
agencies where customized travel packages are offered to the customers based on their
requirements. Also, company is currently expected to serve about 21 million customers with
ensuring the proper management system. Moreover, in context of legal structure it can be said
that company is the limited privet sector organization that is operating more than 180 countries
and aims to deliver the highest quality services to diverse customers that wish to travel to various
places at some point in their life (Ntounis and et.al., 2022). Furthermore, this company falls
under the category of tourism sector and market share of the company is approx 20% among the
top companies in UK that deal in similar business. Moreover, the company is having the strong
workforce that it is capable of delivering high quality services and strive for excellence each time
so that customer satisfaction is highest and also greater loyalty within the business might be

assured. Also, the company is having approx 50,584 employees working all over the world and
meeting certain expectation of the business through their works.
Furthermore, it can say that company conducts all its operations in well-defined manner
through keeping in mind the government laws and regulations and assures that there is the best
utilization of existing resources so that maximum outputs are derived in the end. However, the
market is full of competitors for the company and some of them are Thomascook. com, last-
minute, jet2 holiday etc. that are also working very hard to attract more customers towards the
business (Wurarah and et.al., 2021). Also, it is very essential for the TUI group that it is closely
monitoring all the operations on daily basis and also involved in the market research so that it is
able to identify the policies in which other are operating the business. Hence, that it could be
compared with the existing business working. Moreover, it would further allow the company to
take corrective measures to make improvement in its various services and products within the
business. Furthermore, the company follows the hierarchy structure where all its operations are
clearly defined and also responsibility are assigned by managers in best of manner. Moreover,
the command flows from top to down approach and there is little place for innovation of
products at the workplace. Also, both participative and authoritative leadership style is
followed based on the goals company wishes to achieve in the future.
Section 2
Impact of Covid-19 Pandemic on TUI Group’s
In recent times when there was hit of pandemic there was huge drop in sales in tourism
and other sectors of the world. Also, the tourist industry had been majorly impacted because
people were not allowed to travel to various places and as results of its people were not
interested in moving out of their homes (Ivanov, 2020). Thus, in context of the TUI group it can
be said that it had created negative impact in working operations of the business as company was
finding difficulties to generate enough revenues to meet various expense of the business.
Furthermore, cited company internal environment was not able to function properly as there was
lack of employee motivation and also people remained more in anxiety and stressed thus making
the company culture not very effective to work on. Moreover, company was not able to install
various technologies at the workplace and provide proper training to employees due to remote
working culture. Thus, overall it can be said that organization was facing difficulties in managing

resources and maintain collaboration among the employees so that higher productivity and
commitment from the employees could be assured in long run.
Furthermore, in context of impact of government recovery plan on TUI group it can be
said that it had helped in providing the required assistance and accelerating the tourism sector.
Also, the plan had set some framework so that tourism sector might be build up in most efficient
manner after pandemic (Amaral, 2019). Moreover, the government had provided various
incentives and subsides so that this sector could be built in most effective manner. Furthermore,
through such incentives the TUI had been able to focus on providing the discounts on travel
packages to all its customers so that more sales could be generated in short span. Also, the major
focus of the recovery plan was to build up the economy so that all the losses that have incurred
by the firm could be covered and also business are able to think about the bringing the
innovation like previous times.
Moreover, the objective of recovery plans was to make business more resilient, innovative and
sustainable so that it might be proved more profitable in the long run. Hence, UK government’s
recovery plan had been major tool that had allowed the business to think out of box and develop
strategic planning so that maximum efficiencies in internal factors could be gained.
Section 3
The impacts of Covid – 19 and the resultant UK government’s recovery plan.
Covid-19 impacted the operations of TUI group severely being in the business of travel
and tourism. Such impacts include adverse effects of restrictions on travel, suspensions of flights,
confidence of the costumers being degraded and some hints of negative press publicity. Most
prominent impact the Covid – 19 had on the company was depletion of the cash reserves in the
short term for which long term methods and measures were implemented to mitigate the
adversaries from such a negative impact (Johann, 2022). Also the company had to waive the
cancellation fees which it was charging pre Covid – 19 which resulted in reduction in the
revenue. TUI also offered 20% bonus to the customers who chose to rebook the cancelled tickets
and holidays instead of requesting the refund for such cancellation. Such offering of bonus will
again deplete the cash reserves and reduce the levels of revenue it is able to achieve.
The on – going restrictions on travels has forced TUI group to extend the suspension of
the cruises, holidays and other packages. The company faced the devastating after effects of the
cancellation of 900,000 holidays due to the adversarial covid – 19. Such cancellation of the

holiday packages will again impact its revenue and the resulting profits and thus at last the cash
reserves will be affected.
The UK government had to come up with an efficient recovery plan to recover the losses
faced by the tourism industry and advised the travel operators to be prepared for a surge in the
bookings on unveiling of the roadmap on its re opening (Pricope and Baltescu, 2021). Such a
surge in the bookings will help TUI group attain more customers and thus will require larger
amount of services from the suppliers. Such a surge will also result in the growth of the relevant
competitors in the industry as the recovery plan will be applicable to the operations of all the
players in the industry.
Tourist Accommodation Registration Scheme introduced by the government of UK which
will be rising the short term holiday rentals with an aim to attract tourists to various attractive
destinations across the country and thus will be contributing to the economy of the English
tourism, communities and the local economies (Tourism Recovery Plan, 2022). Such a scheme
will have the effect on TUI group’s marketing intermediaries and customers as the intermediaries
will be responsible for the new customers and such new as well as old customers will be the part
of the increased and improved performance of the group.
Section 4
The impacts of STEEPLE factor on TUI Group’s operations.
There are various factors that affects the operations of any business and these are
described as follows:
Social: Various factors such as societal beliefs, norms and customs that also affects the
tourism industry on large scale. Also, in context of the quoted firm it is positive as nowadays
younger people are interested in travelling to various areas and hence introducing attractive
packages would expand the business operations. Furthermore, people are becoming aware of
various cultures thus making it easier for TUI to develop packages in best way
Technological: Technologies are also upgrading and with upcoming of various latest
digital technologies it had now become easier for TUI to analyse the customer information
quickly through website in form of responses and feedbacks (Chang, McAleer and Ramos,
2020).
Economic: Rising income level, new Brexit reforms and travel restrictions TUI group
working might have both positive and negative impact in the working of the business. Also, the

policies that are developed by groups need to be analysed closely so that based on that
customized travel packages might be provided to various travel customers
Political: Various tax systems, government regulations and political stability also have to
be kept in mind by TUI group so that there are no problems in working. Furthermore, the group
need to conduct various surveys so that customers are able to have best travel experiences and
not suggested to places where there is lack of tourist friendly atmospheres. This will also help in
building the brand image in long run
Legal: Tourism industry is also affected by the legal factors and this could be better
understood through the idea that now people are able to have easy access to visa and there is
reduction in lengthy process of filing the documents (How STEEP and STEEPLE Analysis Help
in Business, 2022). Thus, it would be positive for TUI group to earn more revenues within the
short span of time and increase the customer loyalty
Ethical: Ethical ideas of the country does not change instantly over the period and hence
this factor is positive for the firm if communicated its target and potential customers through
website than positive result would be derived in the end. Moreover, based on this factor the firm
is able to develops strategies that are essential for the continuous growth and success in long run
CONCLUSION
From the above report it can be concluded that TUI Group had been successful over the
years through developing the best legal and organizational structure. Also, the report had
described in detail about the Direct and indirect competitors that had to be closely looked by the
firm before introducing strategies within the workplace. Also, the study had analysed the impact
of pandemic on working of the firm and also discussed in detail about government’s recovery
plan to maintain efficiency and productivity within the internal business operations. Moreover,
role of internal factors in the making the business success globally had also been discussed under
this report. Covid – 19 resulted in depletion of cash reserves of TUI group and such depletion of
cash reserves was due significant decrease in the business of the group and resultantly, group had
to use its current reserves as there was no profits in this period.

REFERENCES
Books and Journals
Shen, Y. and et.al., 2018. Where in the world? A geographic analysis of a decade of research in
tourism, hospitality, and leisure journals. Journal of Hospitality & Tourism Research.
42(2). pp.171-200.
Ntounis, N. and et.al., 2022. Tourism and Hospitality industry resilience during the Covid-19
pandemic: Evidence from England. Current Issues in Tourism. 25(1). pp.46-59.
Wurarah, R. N. and et.al., 2021. the Role of Employee Performance in the Tourism Hospitality
Industry in Indonesia. Academy of Strategic Management Journal. 20(1). pp.1-11.
Ivanov, S., 2020. The impact of automation on tourism and hospitality jobs. Information
Technology & Tourism. 22(2). pp.205-215.
Amaral, M., 2019. Rural tourism, hospitality and cultural tourism experiences–rural tourism
business case studies in Baixo Alentejo (Portugal). Journal of Spatial and Organizational
Dynamics. 7(4). pp.351-362.
Chang, C. L., McAleer, M. and Ramos, V., 2020. A charter for sustainable tourism after COVID-
19. Sustainability. 12(9). p.3671.
Johann, M., 2022. CSR Strategy in Tourism during the COVID-19
Pandemic. Sustainability. 14(7). p.3773.
Pricope, A. P. and Baltescu, C. A., 2021. The Covid-19 Pandemic: An Accelerator of
Digitalisation in Tourism. Bulletin of the Transilvania University of Brasov. Series V:
Economic Sciences. pp.19-26.
Online
How STEEP and STEEPLE Analysis Help in Business. 2022. [Online]. Available through:
<https://pestleanalysis.com/steep-and-steeple-analysis/>
Tourism Recovery Plan. 2022. [Online]. Available through: <
https://www.visitbritain.org/tourism-recovery-plan>
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