Analyzing Inflation Effects on Hays Travels in the Tourism Industry

This report examines the impact of inflation on the tourism industry, using Hays Travels as a case study. It discusses the causes of inflation, including demand-pull and cost-push factors, as well as the positive and negative impacts on company operations and performance. Strategies for controlling inflation, such as price controls, contractionary monetary policy, and open market operations, are also explored. The report concludes that while inflation can negatively affect firms by increasing production costs, it can also offer opportunities for enhanced profitability if managed effectively. The analysis is supported by references to relevant academic literature. Desklib provides access to similar reports and study resources for students.

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Introduction
Tourism is related to guiding of tourists and travellers across different
parts of he country or a city to where a traveller or tourist is intended to
visit or explore. Tourism services includes hotel and restaurants
products and services, guiding of tourists etc. Inflation is an economic
term that is used for the rise in prices of goods and services that a
customer needs to pay to the seller in order to acquire that product or to
enjoy respective service
Conclusion
From the above report, this can be concluded that inflation in an
economy highly affects the hospitality industry and a nation's
position. There are various aspects in which inflation affects a
firm's position in a negative way. On the other hands inflation
has its own benefits for the producers and organisations if
managed appropriately. Furthermore in this report, various
strategies were also discussed in this report that are adopted by
central government by which inflation can be controlled.
Strategy control for inflation
•Price Control
•Contractionary Monetary Policy
•Open market operations
•Reserve requirements
Company background and overview
Hays travels in a independent travel agent chain in UK with its
headquarters in Sunderland in England which has the largest number of
travels agent stores in united kingdom. It was founded by John Hays in
1980 and started its journey by opening a small shop behind a clothing
store that was owned by John Hays's mother in Seaham, Durham
References
•Coibion, and et. al., 2020. Inflation expectations as a policy tool?. Journal of International Economics, 124, p.103297.
•Jain, M.P., Sharma, A. and Kumar, M., 2022. Recapitulation of Demand-Pull Inflation & Cost-Push Inflation in An Economy. Journal of Positive School Psychology,
pp.2980-2983.
•Machlup, F., 2020. Another View of Cost-Push and Demand-Pull Inflation. In Economic Semantics (pp. 241-268). Routledge.
•Nelson, B., Pinter, G. and Theodoridis, K., 2018. Do contractionary monetary policy shocks expand shadow banking?. Journal of Applied Econometrics, 33(2), pp.198-
211.
•Rocheteau, G., Wright, R. and Xiao, S.X., 2018. Open market operations. Journal of Monetary Economics, 98, pp.114-128.
•Rubio, J., 2019. Higgs inflation. Frontiers in Astronomy and Space Sciences, 5, p.50.
Period and causes of inflation that the
company experienced in the past.
Inflation is a term that is concerned with the the rise in the prices of the
goods and services that are being produced in an economy (Coibion
and et. al.,2020). It considers the general rise in the prices of goods and
services that are produced in an economy which the ultimate consumer
needs to pay in order to consume the respective product. It also
includes the rate at which the prices rise in the economy.
• Demand pull inflation
• Cost Push Inflation
• Devaluation
• Increased money supply
Impacts of inflations on company’s operations and
performance
Negative impacts of inflation
Rise in inflation eventually affects every sector of the economy as well as business
organisation as it is directly connected to the prices of goods and services that re
being provided in an economy. The main and the most common issue or negative
impact of inflation is that it directly leads to the higher costs of production as the
firms has to pay more prices for cost of raw material, more wages cost etc.
Positive impacts of inflation
Inflation has its own negative impacts but on the other hand, it also carries its own
advantages for the organisations and producers as in the times of inflation they can
enhance their profitability by selling their goods and services at higher prices as the
consumers are willing to buy necessary products at higher prices as these products
are necessary. Also the sales can be enhanced and increased while in inflation due to
the needs and wants of the buyers.