Revenue Management in Travel and Tourism Industry

Unit 4

INTRODUCTION
Travel and tourism industry is providing leisure to people that have interest in travelling
from one place to another. At present it is the largest sector that is covering larger share in the
marketplace. It is mainly comprises of five parts such as lodging operations, transportation
services, providing food and beverage operations, retail stores etc.
Present study will be based upon on Lotus Group Company. It is the British travel
company that owes Dialal flight and lotus business travel (Xiang, Magnini, and Fesenmaier,
2015). It is also responsible for making travel arrangements that are related to flights, hotels, and
tours.
Report will include concept of revenue management and its rationality in travel and
tourism sector. Applicability of revenue management tools that will help in maximizing profit for
the future. It also includes pricing strategies on revenue management in a specific sector under
travel and tourism industry. Furthermore, it will include different types of financial statements
and reporting mechanism that will be used in an organization. Importance of budget that will
help in evaluating performance of the company. It also emphasize on HR life cycle that is
applied in travel and tourism sector. There are several legislations that will have an impact on
business decision making.
PART 1 SALES, BUDGET AND REVENUE MANAGEMENT
Concept and principles of revenue management
It refers to the process of selling product and services to right people, at the right time and
at right price that will help in evaluating the efficiency of cost in Lotus Group. It will help in
evaluating the performance of company by using data and information that will help in analyzing
demand and the behavior of consumer towards Lotus group.
Principles of revenue management
Market Segmentation:- This principle helps in determining customer needs and demands that
will help in satisfying its needs and wants (Sigala, 2017). Customers are divided into various
segments according to their demands that will also help them in fulfilling easily. It is important

for Lotus Group to segment consumer that will help in increasing sales as consumers are the king
of the market.
Supply Forecasting:- It is important to check out the availability of rooms for the traveler as
there may not be shortage of rooms so it is to be managed in advance for the future course of
action by the manager of Lotus Group.
Applicability of revenue management tool in Lotus Group Company
There are four important tools that will be used in the company are as follows:
Property management System:- This tool is used for determining success of company in the
future. This will help in making easy flow of work in company for the future. Nowadays
companies are adopting different technologies that will help in upgrading different systems that
will be applicable in Lotus Group. In selecting this tool company needs time for maintaining
flexibility in the premises.
Booking Engine: - This is also an important tool that will be used in detecting sale at a point of
time that will help in benefitting company in the future. This will help in attracting international
customers from other countries as well. It is important to use this tool in the business as it will
facilitate in increasing sales
Channel manager:- This will help in managing stock of Lotus Group manager effectively so
that it will facilitate various procedures for future.
Rate Shopper:- It is used in paying attention to competitors that are available in the market.
Through this company can evaluate its ranking for future in market.
Impact of pricing strategies on revenue management
It is having a greater impact on sales of the company. As consumers are the king of
market so company have to produce goods accordingly. It is important for Lotus Group to
satisfy needs and demands of traveler who are travelling from one place to another (Mahrous
and Hassan, 2017). There are different pricing strategies in market such as penetration, price
skimming etc. that will facilitating various aspects in the market. Consumers buy product after
seeing price that will have greater impact on business operation of Lotus group. As price is the