TUI Group: Overview, Inflation Impact, and Management Strategies

POSTER
INTRODUCTION
Tourism sector falls under the category of those leading industries in the market, that
gained unpredictable benefits in form of competitive advantages. The current
assessment will be based on TUI group, which falls under the category of leading
tourism companies in the UK. The study will explain an overview of chosen firm and
products or service it provider to the target audience. It will explain period and cause
of inflation that firm experience in the past and also justify the reliable sources that
determines models and theories that used to eliminate the impact of inflation and
increase positive impacts.
Providing an overview of TUI and their services/products
TUI group is German travel agency providing travel and tourism service to the
customer, that in turn provide unpredictable benefits to them. This brand has
global footprint of providing the best tourism service along with leisure and
accommodation. Headquartered in Hanover, Germany, TUI is leading travel
agency around the world. TUI group comprises more than 400 group of hotels
around the world allowing guest to choose the best destination for their
travelling, this travel brand tied up with hotel brands including Hilton, Premier
Inn and Holiday Inn. Online partners may include Booking.com, Agoda and
AirBnB. In the tourism sector, organization conduct its practices for purpose of
aim achievement and that is to create the best moments for the target
market. At initial level, firm can take initiative to establish its existence in the
five nations such as Portugal, India, Spain, Malaysia and Brazil, where success
and growth chances are accessible in the bulk. There are certain type of
service offered by TUI group, these are:
·Hotels and resorts
·Cruise trips
·TUI amusement
·tour operator
·and even travel airline
TUI group usually focuses on creating unforgettable experiences and moments
for the target market, across the whole world, so that it can make the dreams
of consumers come true, in real manner. The main motive of chosen tourism
company is to enhance the satisfactory level of individual guest, in form of
providing services and products such as food items according to their needs
and requirement.
2- Determining the period and causes of inflation that TUI group experience in the
past. Inflation is one of those external factors that impact the world business, along
with economic growth, in the adverse manner. The main reason behind inflation is
supply of money is increasing more the accessibility of goods and services in the
market, which creates unpredictable challenges. It can be said that there were six
peraiods in which inflation has been occurred, and these are 1946-48, 1950-51,1969-71,
1973-82 and 2008. The rise in the amount of money in the context of supply of
products, can become the main cause of inflation, that can impact TUI in negative
manner.
TUI group experience unexpected situation at the time of inflation in term of managing the
flow of demand related to goods, that they expect from the suppliers to provide firm on
time. It can create challenge for the company to fulfil the needs of each guest, who expect
to take great experience while visiting in the hotel in form of enjoying meal that food &
beverage department prepare for them. TUI impacted at the of inflation in negative manner,
in term of decreasing customer base, which is not suitable for the rapid and competitive
growth of hotel, in the tourism sector, where number of external factors accessible in the
bulk. Due to inflation, individual person in the world, are facing issues to purchase goods,
as they are unable to spend money on such things, including services that they prefer to
use, like accommodation, tour and travel, etc. in the tourism sector. It leads to decrease the
sales and profitability of TUI, as customers are less interested to visit a location, where the
expenses are higher than the saving. It is fact that the inflation is a significant force that
affect tourism demand and industry, as well as TUI, because it has established its brand in
the similar industry, for purpose of running venture into number of developing nations.
Inflation in the world of travel and tourism can become the major cause of distress among
the business travel and leisure, which means, TUI struggle a lot of to sustain for longer,
with wide customer’s base, among which each guest is able to conduct word of mouth
promotion.
There are different ways, in which inflation had impacted on TUI group, such
as decrease the profits and revenue, that firm expects to increase more than
last few years or months, than the rivals, who are also running their ventures
in the same market. The productivity and performance level of TUI group is
also being impacted negative, because of inflation, in term of decrease the
workforce. As each candidate place demand of increasing salary, because they
are unable to manage their life, due to facing challenges of increasing
products price. Thus, it creates challenge for the management to focus on this
thing as well, along with other issues that occur due to inflation. It drives the
attention of management in the TUI group towards taking key actions to
eliminate the impact of inflation that can be more adverse than the other
things.
3- Determining the models and theories that can be utilized to
reduce the negative impact of inflation and increase the positive
impacts.
During the time of inflation, there are different types of practices and
activities, companies while running businesses and operating functions
in the tourism sector has been conducted. Along with that, they took
some models and theories into consideration, like TUI in appropriate
manner. For purpose of reducing the adverse impact of inflation,
chosen company take price model into its consideration, which is quite
essential and beneficial for rapid growth of venture in the competitive
and complex market. In the world of business, price model is utilized
as strategic method that aid firm to determine the right price for its
products that it can utilize to provide better consumer experience, after
transforming the purchase item, such as raw material to prepare meal
for the individual guest. The selected model takes certain factors into
consideration such as customer perception of its value, form of items,
and cost of producing meal, according to the target market requirement.
TUI Group can use price model, in term of reducing the impact of
inflation, by taking right decision to purchase raw material, that they
can further offer to people after appropriate transformation of that.
Organization can utilize cost plus pricing model, so that management
can set the price of goods, with calculation of total cost of materials,
worker overhead that go into making an item and then adding a mark-
up, which make them capable to earn a profit. In the context of
inflation, another concept can TUI group and its management consider
along with above model and that is Six sigma, which falls under the
category of leading operational management theories.
The chosen theory is considered as statistical & data driven procedure
that works in term of reviewing the limitation, defects and mistakes.
Six sigma concept encompasses different stages, actions or practices
that help TUI group to increase the positive impact and eliminate the
adverse effect of inflation upon its venture. It is quite essential for the
management according to the key stages of theory is to identify the
issue behind the impact of inflation upon business, because it can give
them clarity about the extent to which the factor affect and in which
manner.
After passing the first phase, they can move to the next one,
which is to measure the current procedure, such as food and
beverage or meal production, in the hotel, where employees
focus on preparing meal for each guest, by considering their
preferences and demand. It can enable them to eliminate the
negative impact and increase the positive influence. It also helps
management to offer services to the target customer, in budget
friendly manner, so that individual guest can take decision to
visit TUI group, by reaching at specific location, where firm has
set up its venture. After the two most important stages, they can
move further towards the process of analysing the cause of issue
and then improve the process appropriately, without making any
mistake that create more issues for the management to handle.
CONCLUSION
On the basis of above discussion, it has been concluded that by
developing the best operational management strategies, company
has increased the positive impacts, after facing the worst situation
in the world of business, due to inflation. It has developed the best
tactics and has taken strategic decisions, that contributes in the
context of gaining competitive advantages and building positive
brand image in the market. Furthermore, from above analysis, it
has been determined that utilization of six sigma, price model and
other operations' management theories, contributes to eliminate the
adverse impact of inflation. It has enabled leaders and managers to
achieve the key aims of company.
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