The Travel and Tourism Business Toolkit

This document discusses the rationality and principles of revenue management in the travel and tourism industry. It also reviews the stages of HR life cycle in T&T job roles and provides a performance management plan. Additionally, it explores specific legislation that organizations in the travel and tourism industry have to adhere to and explains the impact of company, employment, and contract law on decision-making. Finally, it describes various types of financial statements and reporting mechanisms in the travel and tourism industry.

Unit 4: The Travel and
Tourism Business Toolkit

INTRODUCTION
Travel can be defined as going from the one place to another that can be long distance
travel, short term or oversee and many forms of it. Travel industry consisted with various aspects
to the broader industry cater to the needs and desire of those individuals who travelled from one
part to the another in order to gain important insights. Respective industry contributes one of lot
efforts in context of economy as well as provide employment opportunities to large no. of
people. Respective report is based on TUI group which is an Anglo German international travel
and tourism organization having headquarters is in Germany. The respective report is based on
the significance of principles of revenue management and the way T&T industry apply
respective tools to generate profitability. Further it elaborates about various stages of Human
Resource life cycle in a specific job role for developing talent and prepare the performance
management plan to overcome from various issues.
TASK 1
P1 Evaluate the rationality and principles of revenue management in travel and tourism industry.
Revenue management
Revenue management refers to the application related with the disciplined analytics
which predicts or forecast the consumer behaviour at a small level to optimise the availability of
product in order to maximise revenue in positive manner. In context of TUI Group they by using
respective tool manage their resources in order to best utilise for gaining effective results.
Significance and principles of Revenue management in specified industry
Significance
Revenue management plays very much crucial role for organisation. It is categorised as
an offering the perfect room at the perfect cost at right time in order to achieve loyalty of
consumers (Baumgartner and Bansal, 2019). In reference to Travel and tourism industry where
revenue management extended up to the conferences, restaurants and other kinds of recreational
facilities such as spas and golf courses as they provide various services under one roof. In T&T
industry key components are exceptionally perishable in nature if the hotel rooms and other
services not sold till tonight then it can not be hold in stock so it can be stated that owner of
tourism services must guarantee revenue achieved sale's streamlined. To enhancement in revenue

for earning profits is very crucial to acknowledge importance of managing revenue in T&T
industry.
Principles
It includes:
Market segmentation- As per the principles of revenue management the customers
segmented into two parts that are qualified and non qualified (Brauer, Dymitrow and Tribe,
2019). In that aspect segment of market rely on various attributes of consumers that enables an
organisation in order to enhance their revenue. In context of TUI Group they frame strategies in
order to enhance revenue.
Historical demand and way of booking- To generate higher revenue in context of TUI
Group they forecast demand on basis of historical data and booking patterns of their potential
consumers in order to relate their future needs appropriately. So in context of TUI Group by
respective principle organisation can be build one of their best products and services in order to
gain a competitive advantage in the market.
Tools of revenue management in T&T industry- In respective industry no. of tools
applied in order to generate profitability and market share that are as follows:
Capacity utilisation- By using respective tool organisation able to predict the
requirement of facilities so that consumers can gain potential outcomes. In context of TUI group
they forecast demand of consumers in order to reap important outcome from them.
Allocation of discount- Respective tool of revenue management used by organisations in
order to offer discounts and other kinds of advantages so that consumers can take buying
decisions promptly. In context of TUI Group they provide vouchers to their consumers so that
they can attain high level of profitability.
P2 How the T&T industry applies the revenue management tools to generate profit.
In an organisation there are various tools of managing revenue that should be applied in
order to gain potential outcomes (Bruno and et. al., 2019). There are various tools one of them
are pricing strategy that are crucial for both business as well as consumers in order to sell
maximum services to ultimate consumer in positive manner. Here are the impact of pricing
strategy on revenue management of a firm with their principles with applicability within
organisation:
Impact of differentiated pricing strategy on revenue management

Differentiation serves to be one of the most important for an organisation in which
organisation affix one of best price that based on various kinds of factors such as purchasing
pattern of consumers, demand, economic conditions and many more. Respective tool of revenue
management affect in positive way that it enables to target at wider extent to consumers, enlarge
business opportunities as if pricing is low then consumers attract towards purchasing their
products and services (Ferreira and et. al., 2019). On other hand negatively that people
perceived low quality of their products and hamper brand value negatively.
Principles of revenue management
Forecasting- By using respective principle organisation can be able to predict or forecast
demand and supply in order to gain potential outcomes.
Monitor- Respective principle of revenue management helps to keep record of all
knowledge and information in order to acknowledge purchasing patterns appropriately.
Control- For an organisation it is very effective to regulate all activities such as cost, rate
of attributes, values of facilities and many more.
Application of revenue management
Revenue management principles applied in wider organisational context as it enables to
segment market on various basis such as pattern of purchasing, demand of products such as in
context of TUI group the hike the rate of pool parties in summer season as people enjoy in that
season.
TASK 2
P3 Review various stages of HR life cycle that are applied in T&T job role with their
significance in retaining and developing talent.
HR has a unique kind of life cycle that helps to take care every kind of potential
requirement of an individual in positive manner (Ferreira, 2019). In context of TUI group by
using respective cycle enhance retention rate of employees that are as follows:
Recruitment- In respective activity of HR life cycle which starts with hiring the right
kind of personnel within the organisation. As hiring decisions plays very much crucial role in
order to overcome from concerns of turnover of employees. In context of TUI group they operate
at large level so they demand one of most talented personnel in their organisation by using
various rounds of test.

Education- In context of TUI Group they begin the process of education from the
employees' very first day of working. By implementing this activity, the organisation will be able
to best services in order to generate more output from them.
Motivation- In today's business environment turnover is very much which directly
affects organisational performance and profitability. In context of TUI group they by giving
bonuses, promotion and health insurance for whole family In order to gain potential outcomes
from them.
Evaluation- In respective stage supervisor examine the performance of employees and
they give their reviews to their leaders and on specific kind of metrics to fit for a specific job
role (Ferreira, 2019). In context of TUI group they by conducting the performance conversations
that are based on various facts and figures to examine the performance and accordingly appraise
the values of employees.
Celebration- In this stage of the human resource cycle, opportunity to reenergize
employees is provided so that they put in their best possible efforts in their work and this will
also help in their self development in an effective manner.
In context of TUI group HR life cycle proved beneficial for organisation to provide
motivation and enhancement of their productivity that directly enhance their motivation level.
For an organisation retention rate of employees plays very much crucial role as they provide
training and development, various kinds of rewards and appraisals in order to gain potential
outcomes (Griffiths and Wiltshier, 2019). Respective cycle also helps to evaluate causes behind
such as lack of training, motivation, environment and many more. It has been recommended that
organisations should focus on enhancing the motivation level of their of their employees in order
to remain competitive in the business environment.
P4 Prepare the performance management plan for respective industry by applying techniques.
Performance management is chain of activities or procedures that are adopted by an
organisation by aligning personnel with their resources in order to attain organisational goals and
objectives. In context of TUI group they for the job role of Marketing manager that are as
follows:
Job Title Marketing Manager
Department Marketing Department

Company TUI Group
Date 30th December 2019
Improvement of the
Objectives
Success Criteria Additional Support
required
Outcomes of the
objectives
For eradicating
adverse attitude of
employees
For an organisation to
eliminate adverse
behaviour required to
apply training and
development sessions,
motivation by giving
bonuses in order to
gain potential
outcomes (Koľveková
and et. al., 2019).
In order to improve the
performance of
employees
organisation needed to
conduct training and
development so that
they can give one of
their best efforts in
positive manner.
In context of TUI
Group they gain
potential outcome by
using respective tools
to remain competitive
in marketplace.
Overcoming issues of
staff retention
For retaining staff
within the organisation
it is very crucial to
acknowledge the
problem that why they
are not continue in
their job and then act
accordingly.
In that regards
marketing manager
takes review from
employees and the
way from they
improve their
motivation level
(Kuščer and Mihalič,
2019).
By using respective
approaches
organisation can be
able to gain potential
outcomes to retain
talented personnel in
organisation as it
enhance brand value.
So from the above scenario it has been summarised that for an organisation it is very
much crucial to find out gaps and reason behind low productivity level of employees so that they
can improve level of facilities for gaining potential outcomes.

TASK 3
P5 Explore specific legislation that organisations in the travel and tourism industry have to
adhere to
In order to conduct functions and operations of business at local, national and
international stage, organisation has to face legal issues in terms of following legislation for
developing various rules and regulations so that change strategies has to develop as per
occurrence. The legislation which TUI Group has to follows are:
Health and Safety Act, 1974- The organisation is required to implement the health and
safety act into its business in order to carry out its operations in a more effective and efficient
way. With such act, guest as well as employees get health and safety at workplace and hotels.
Equality Act, 2010- TUI Group has to follow equality legislation for providing equal
rights to all working force without discrimination on basis of caste, religion, gender, educational
level, disability, colour and so on (Morais, Cunha and Gomes, 2019). This helps employees to
work in diligent manner for achievement of positive outcomes.
Minimum Wages Act, 1998- As per such legislation, TUI Group has to design minimum
wages as per jobs and roles assigned to employees in proper manner. This helps to get employees
at least minimum pay for work performance.
P6 Describe how a company, employment and contract law have a potential impact on the
decision-making of a business in the travel and tourism industry. Explain with the help of
suitable examples.
Travel and Tourism organisation has to follow several laws and regulations for
conducting business activities and operations in proper manner by following of contract,
company and employment law (Moyano, Rivas and Coronado, 2019). Such laws impact business
decision making directly and indirectly at travel and tourism sector. The laws are explained in
context of TUI Group are described below:
Contract Law- It is defined as law in which buyer and seller are provide protection
related with particular organisation in order to trade business. TUI Group has to adopt such laws
in their business for doing proper transaction with customers, suppliers, buyers and so on. This
helps to protect rights of both parties of stakeholders, company, suppliers and consumers.

Company Law- This is also called corporate law in which government of nation has to
analyse rights and duties for their stakeholders, employees, shareholders, creditors and many
more. Each and every organisation running their business and operation at marketplace has to
follow such law for positive outcomes. This leads to run business in proper manner to gain
positive results. The respective organisation has followed such laws in order to make business
decision as per duties, roles and rights of various stakeholders.
Employment Law- It is defined as law that describe relationship among employees and
employers of company. With the following of respective law, TUI Group can conduct several
things like governing their employers about their expectations from employees, evaluating
employees rights at workplaces. This will assist in decision making process of business as it
leads in maintaining quality interaction between employee and employer.
TASK 4
P7 Explain various types of financial statements and reporting mechanisms for organisation in
the travel and tourism industry
Financial statement is defined as reports which are prepared by management of company
to present the current financial position at particular time period (Mukherjee and Banerjee,
2019). It is prepared by each and every organisation for knowing their financial condition. This
is made at the end of a financial year. In context to travel and tourism industry, several types of
financial statements are prepared by them in proper manner. This helps respective organisation in
making business decisions regarding management of funds and resources. The various types of
financial statements and reporting mechanisms that the TUI Group should adopt are explained
below:
Income Statement- It is referred to as one of the core financial statements that reflect
profit or loss over particular time period (Ruhanen and Bowles, 2019). Here, profit or loss is
identified after taking all profits and subtracting expenses from operating as well as non-
operating activities. This is prepared by TUI Group in order to know their total income earned
through functions and operations of business. This shows profits or loss depending upon business
whether they have made profit or incurred loss during particular time period.
Balance Sheet- It is referred to a statement relating to the financial condition or position
which is summary of financial balances of organisation or individual. This is very important for

organisation as it assist in showing financial position of enterprise for given time period. This
statement is prepared by TUI Group for knowing their financial condition. It reflect total asset
which is possessed by respective firm and liabilities that has to be paid to debtors, suppliers and
so on.
Statement of Cash Flow- It is defined as statement that shows in flow as well as out
flow of cash of business for specified time period. This financial statement is categorised into
three activities such as operating, investing and financial. The respective financial statement
helps in analysing financial position and profitability of business for a specific period of time. It
leads to know about how much cash has out flow and how much cash has in flow in firm.
Therefore, it is very important for TUI Group to prepare all above mentioned financial
statements to know about their actual situation of business for positive outcomes. These assist in
knowing about asset, liabilities, profits, loss, cash in flow and cash out flow for effective
outcomes.
P8 Explain the importance and value of budgets for controlling business performance and
identifying variances
Budget can be defined as financial plan which is prepared for particular time period
which is usually one year (Tillyaxodjaev, Mamataliev and Azlarova, 2019). This includes
planned volumes, sales, revenues, cost, resource quantities, assets, liabilities, cash flows. It is
made by government, companies and families in order to express strategic plan of activities or
events that can be measured in terms. This is prepared by respective organisation in order to
control the business performance and identify variances. The importance as well as value of
budget for TUI Group are described below:
Predicting Future Emergencies- Budget is prepared in order to conduct business
activities and operations in appropriate manner to achieve positive outcomes. It is necessary for
the companies like TUI Group that come under travel and tourism industry to make budget in
order to predict emergencies situations and accordingly saving funds or money. This also leads
in keeping eye on value of money so that each and every activities and operations can be run in
best possible way.
Helps in Minimization Expenses- The budget prepared by TUI Group helps them in
evaluating expenses about where their money is going to be used (Victorovna and Ivanovich,
2019). With the preparation of budget, management will be able to identify their cash outflow as

well as inflow in best possible manner. This will lead to conduct and think practices of business
in systematic way to achieve the specified goals and objectives in an effective and efficient
manner.
Interpretation of Financial Statements and Reports
The financial statement of TUI Group will include profit before tax from income
statement which is 1744 and deduction of tax will remain amount is 1403, the calculations are
mentioned below:
Calculations of Ratios

Compare financial performance against strategic targets and objectives
The ratio analysis shows that strategies will helps to determine target of each items along
with objectives to fulfils requirements. The above represents various types of ratios for
respective organisation.
CONCLUSION
From the above report, it can be concluded that travel and tourism industry is the fastest
growing sector that provide benefits to country and company as it assist in earning high profit
margins in a much more effective and efficient way. Organisation has to consider several aspects
in order to operate functions and operations in appropriate manner. The revenue management
principles helps to develop strategies to gain profit and human life cycle assist in conducting
business operations in positive manner. The HR life cycle leads in developing talents of the
employees and hence retain them for long time period. All ethical and legal legislations and
practices should be followed by the Travel and Tourism Industry in order to operate its functions
and activities in a coordinated and systematic manner. Organisation has to manage statistical,
financial, budgets records for analysis of various kinds of financial statements besides carrying
out analysis of importance of budget to control performance of its various business operations.

REFERENCES
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