Tour Operations Management: Package Holiday Creation and Evaluation

This report comprehensively analyzes tour operations management, focusing on the roles and functions of tour operators, with TUI Company as a case study. It explores the different types of tour operators, their activities, and the scale and structure of the industry. The report outlines the stages and components involved in creating package holidays, including market research, capacity planning, and product development. It also examines how consumer demand is defined and forecasted. Furthermore, the report reviews, compares, and evaluates various package tour programs serving similar markets. Finally, it explains strategic and tactical decision-making processes in tour operations, assessing external factors and evaluating the decisions made by tour operators. The report provides a detailed overview of the complexities and challenges within the tour operating industry, highlighting the importance of effective management and strategic planning.

Tour Operations
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Different roles addition to functions of tour operators range......................................................3
Explanation of scale as well as structure of tour operating industry...........................................6
Task 2...............................................................................................................................................7
Outlining various stages as well as components for creating package holiday...........................7
Define and forecast changes in consumer demand by using sources of research.......................9
Task 3.............................................................................................................................................11
Review the content of range of packages tour programmes which serve similar product market
....................................................................................................................................................11
Comparing and contrasting a range of package tour programmes which serve a similar product
market........................................................................................................................................12
Evaluation of range of package tour programmes which are serving similar product market. .13
Task 4.............................................................................................................................................14
Explanation with examples of strategic and tactical decision making in tour operations.........14
Assessment of external factors which affects adversely strategic and tactical decision and
recommend response..................................................................................................................15
Critical evaluation of strategic and tactical decisions ...............................................................16
CONCLUSION .............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
Tour operation management is defined as imperative task wherein entities prepares
holiday packages along with elaborated information in context to tour. In other words, tour
operation management can be mentioned as effectual process wherein tourism companies plan
standard quality travelling packages and manage them properly. The main work of business
concerns in this task is to attract tourists across nation together with increasing sales turnover of
operators of tour (Allahyari, Salari and Vigo, 2015). Tour and travel sector offers various
facilities to customers in order to make the trip memorable addition to comfortable. For
understanding tour operations management. TUI Company is chosen which performs activities in
Travel and Tourism industry. Its head offices were established at Luton, England and serves the
wide area of United Kingdom. The products offered by selected business concern are package
holidays, hotels and resorts, Charter as well as Scheduled passenger airline along with cruise
lines.
The present assessment includes information about roles, functions, types, scale and
structure of tour operating sector. It also includes different stages so to develop package holiday.
Further, it assess various tour programme range for meeting needs of targetted market. At last, it
examines various strategic along with tactical decisions that are framed by tour operators.
TASK 1
Different roles addition to functions of tour operators range.
Definition of tour operating business
Tour operating business can be mentioned as the organisation that purchases individual
travel essentials, separately from suppliers so to combine them in particular trip package that is
offered with price tag to targetted customer either directly or with the help of middlemen. This
type of business is owned by a person in which they transports paying holidaymaker on
organised itineraries together with makes arrangement for potential customers related to
accommodation, conveyance along with excursions. TUI Company is also a tour operating
business that works for organising addition to preparing variety of holiday tours (Evans,
Stonehouse and Campbell, 2012).
Tour operators performs wide types of business activities. One of business activity is to
devise, set up and promote options for holidays and travel so to execute proper arrangements.

Moreover, they also performs consultation services wherein they provide advices and solution to
customers in terms of where to go, best means to reach any destination and many more. For
instance, TUI Company, being a tour operator, it performs business activities related to drawing
travelling itineraries, provides advises for distinct travel destinations, makes arrangements for
conveyance, tours along with accommodation, contacts airlines, ground transport entities and
hotels, uses computer database in order to research information for fares of hotel accommodation
and ratings, performs general administration tasks, plans and promotes travelling packages, deals
with payments and evaluates customer's holidays so to issue suitable feedback forms.
Types of tour operators:
Tour operators are the travel agents which have specialisation in package holidays. These
operators combines tour as well as travelling components on order to frame a holiday package.
Moreover, they advertise together with produces brochures for promoting the set products,
itineraries as well as holidays (DiPietro, Cao and Partlow, 2013). These are generally responsible
to put essentials of tour ingredients, promoting them, making reservations together with properly
handling actual operations. Following are some tour operator types:
Mass market operators: These are the tour operators which organises tours for mass
population at a time. They requires understanding of entire tourism sector very well and have
knowledge for most affordable routes addition to transportation modes. For example, TUI
company is well popular as mass market tour operator because of selling holidays which request
to mass population of holiday makers.
Independent operators: The tour operator which organises things for themselves despite
of using any travelling institution or company. In other words, independent tour operators are
said to the single agency which are specialises in arranging hotels, flights and many more.
Domestic operators: The tour operator that manages travelling operations with nations
boundary are domestic tour operators. They assist in promotions for beauty, diversity as well as
culture of nation against population of country along with frames tour packages as per customers
interest, preference and choice (Bazargan, 2016).
Incoming operators: Incoming tour operators are described to the travelling
organisations that offers local services to travellers in location, including car rental, sightseeing
and many more. These operators also provides services for exhibitions addition to conferences to
travellers.

Outbound operators: These trip operators are specialised for creating and promoting
multi national holiday trips. They offers tourism packages to people or group of people of their
own country and another nation for particular decided time frame. Moreover, they also arranges
documents the purpose of travelling such as visas, conveyance to starting location, local
sightseeing and many more.
Functional roles of tour operators:
There are various roles and functions which tour operation business performs. In context
to TUI Company, following are its main function and roles:
Functional roles of tour operator: Tour operators are basically popular as service
providers to travellers in terms of visiting, staying as well as exploring the city or nation.
Different functions in relevance to TUI company are underneath:
 Product development: One of important function of tour operator is to develop the
product in accordance to traveller needs and choices. The entire production department of
TUI company sits and ensures that they have accurate marketing mix of destinations,
concepts along with hotels for matching customer demand. They tour operating company
analyses customers choices and develops suitable product for travelling aspect.
 Marketing and sales: Tour operators also have role of marketing and selling tourist
products. In relevance with TUI Company, it makes huge tour packages within distinct
market including national and international so that sales volumes at hight level are
achieved. In marketing of tourist products, key roles are played by tourist operators.
 Advising customers: Tour operators plays function of advising customers about
available packages as per the budget. For example, TUI Company provides advises about
various destinations of travelling that suits the interest of customers (De Sausmarez,
2013).
 Travel information: Tour operators also execute function for delivering necessary travel
information to wide travellers. In relevance with TUI UK, the tour operator execute
function for providing up to date, timely as well as accurate information related to
destinations, accommodations, immigration, travelling modes and rules that permit
travelling for specific location or area.
 Operations support: Tour operators also supports other operational areas such as
planning accommodation, controlling hospitality services and many more. Tour operator,

such as TUI Company plays key role of supporting operations so that maximum
hospitality products and services are provided to customers that satisfies their choices
together with interests.
Explanation of scale as well as structure of tour operating industry
Position of tour operators in distribution chain
Tour departing industry is wide industry that includes huge types of tour operators.
Within UK, the estimated worth of Tour Operator industry is approximately £14.9bn because of
existence of various top trip operators (Tour Operating Industry, 2020). The distribution chain
explains the involvement of agents or operators within the travelling industry are linked with
each other. At present, the top positioned tour operators in the chain of distributing tourism
services and products are TUI Company, Jet2 along with Thomas Cook. Along with this, various
other tour operators that are also positioned on high ranks in the industry are British Airways
Holidays, Kuoni and Explore (Evans, Stonehouse and Campbell, 2012).
Profiles of key tour operators:
Key tour operators in tourism industry of UK are TUI Company and . Their profiles
which differentiate them from other tour operators are as discussed below:
TUI Company: It is one of top positioned tour operator whose origins lie within
industrial as well as transportation entity Preussag AG, that was originally set up as mining
company in Germany. From September 2007, the ownership of 55% TUI Company was within
new entity, TUI Travel Plc. Considering its market segment, the company divides entire market
as per behavioural and demographic aspects which are segmented as per attitude towards brand,
usage rate and many more. The company follows structure of tourism development in which the
entity provides updated information to customers in context to all related things in the tourism
industry so that they can enhance their proportion of tourists. Tourism Information Board is the
main authority that operates the structure for tourism industry. In terms of the scale, the
company have approx 70000 employees who are liable to serve more than 100 nations through
its products and services. It is analysed that it offers 27 million comprehensive services to its
customers from single source that differentiate the tour operator from others.
Jet2: The another top poisoned tour operator if Jet2 when is highly competitive entity of
TUI Group. It is evaluated that the tour operator has its origin from Dart Group which is an
aviation service addition to distribution group. The tour operator initiated its activities in 1983

with the name of Channel Express. Moreover, the ownership of the tour operator lies within
Philip Meeson of 37.85% shares. The market segment of Jet2 is done on the basis of geographic
segmentation only in which the targetted customers have differences in interests and their
preferences varies throughput states, regions or countries. The company follows transportation
structure so to deliver transportation system facilities to the targetted ones. Within the structure,
the company provides huge variants of transportation facilities including aircraft and many more
to meet demand of different market. In context to the scale, the company have nearby 12000
employees that offers services and products related to aircraft and travelling to 72 countries
which differs it from other tour operators (Guo and He, 2012).
Task 2
Outlining various stages as well as components for creating package holiday.
Creating holiday package is said to the process that involves various stages for designing
a suitable package for a holiday. For this, various workings are to be done in various phases that
leads in planning perfect trip. In order to develop a holiday package, managers of TUI group
have to undergo with various stages that will assist in creating effective holiday package. For
example, to create holiday package for educational tour as well as escorted luxury coach by
targetting students of above 18 years from London to Belgium that will visit few areas including
Ghent, Antwerp and many more in Summer 2022,
Following stages as well as key components in context to carrying holiday packages for
requirement of distinct tour operator:
Market research: At this stage, TUI Company managers will conduct market research
so to analyse needs of customers for holiday packages. The component in the market research
stage is interviews, trend analysis, competitive assessment and understanding needs that belongs
to different types of tour operations. In this stage, marketers of TUI Company conduscts market
research for recognising the preferences and trends that are more in demand so that they can use
the data for building trip package. It is the main stage wherein tour operator collect relevant
information about tourist destination, legal authorities, guidances and transportation facilities that
are preferred by the customers the most (Khairat and Maher, 2017).
Capacities: In this stage, tour operators evaluate the ways that will help in maximising
potential activities as well as production outputs under all conditions. They main component in

capacities includes opportunities within which various workings are executed to build an
effective trip package in accordance to requirement of various tour operators. Moreover, it also
involves workings towards recognising the expectations of tour operators for holiday package.
In this, TUI Company managers will measure the potentials that can be achieved, produces along
with sold in particular time frame. The calculate capacities of the activities that will assist in
achieving outcomes.
Contracting suppliers: After research about market and analysing capacities, the next is
to contract with suppliers or middlemen for conveyance, accommodation and ancillary services.
The essential components in building suitable holiday also include establishing relations with
suppliers that have information about location, transportation and so on in order to provide
suitable offerings to customer. For example, a supplier is the one who arranges transportation,
accommodation and other aspects concerned with a holiday package. Herein, production team of
TUI Company will contact with suppliers and will discus them about required components
including transportation modes, accommodation facilities, transfers along with ancillary services
for the holiday trip.
Pricing: Herein, prices for the holiday package will be set with the help of various
strategies. Key component in holiday package is the price involved in holiday package. To set a
price, various factors are recognised by managers of TUI Company including the direct cost and
indirect cost in the holiday package. The managers for respective holiday trip, will use pricing
strategies like seasonal flexing, skimming strategy and discounting strategies so to set suitable
and accurate prices according to the value of the holiday package (Lenahan, 2011).
Brochure production: After setting prices, the next stage is to produce a brochure that
will entails all relevant information about the package and other essentials. Brochures are
important component in devising holiday package. A brochure involves detailed information
about the holiday package as well as motivates different tour operations to chose their required
package. For example, travel brochure is perfect for holiday package as it entails about particular
trip package that aids tour operators in meeting requirements. Herein, TUI Company managers
will communicate with other departments so that an attractive brochure is designed which
attracts huge population or targetted customers for the holiday package.
Marketing and sale: In this, the holiday package is marketed and sold to targetted
audiences. Essential components of marketing are place, price, promotion and product for which

all the activities are performed sequentially. For example, TUI company has devised a product in
this case is holiday package, price is the monetary value that customer or tour operators pays,
place is the distribution system and promotion includes the ways in which it will be marketed in
among tourists. Through using marketing strategies like paid advertising, word of mouth,
transactional marketing and diversity marketing, targetted population will be attracted towards
the holiday package and maximum sales volume will be achieved. The essential components in
marketing and sale are online advertisements, communication channels and social media tools
which will help in promoting the tour package and improving sales volume of it.
Critical path analysis: In this stage, all the tasks will be mapped out for completing the
project. In relevance to creating holiday package effectively, the stage is importance as it map
out all the necessary activities and involves identification of time for finishing all activities along
with the dependencies of activities on others. Essential component in building holiday package
includes the activities which are scheduled to achieve final location. For example, the holiday
package designed by TUI Company includes activities or the paths through which travelesr will
go through to meet their final requirements. In relevance with creating holiday package by TUI
Company, the stage defines important tasks and provides highest insights levels along with
correlation among tasks, providing understanding for task duration that are required to modify
and which are to be performed as same (Luis, Dolinskaya and Smilowitz, 2012).
The timescale for the each activity or scale regarding creating holiday package for, it is as
follows:
Activities January
01 to
January
25
January
23 to
Februar
y 20
Februa
ry 26
to
March
31
April
01 to
April
25
April
26 to
May
05
May
06 to
May
25
May
26 to
June
05
June
06 to
June
30
Market research
Capacities
Contracting supplier
and pricing

Brochure production
and marketing with
sales
Critical path analysis
Define and forecast changes in consumer demand by using sources of research
In changing environment, the needs of people are also changing so they are demanding
for new products and services which can satisfy them and make feel them happy. This is
important for organisation to know the needs of people and provide products accordingly which
can help to improve the production and profitability. Without knowing needs of people a
business organisation cannot get success because it needs information what people wants and
how they can be satisfied. Evaluation of customer's needs is consider as main information factor
which helps to complete the goals and increase organisational profits. Forecasting is the process
of making predictions of the future by interpreting the past data and present data. In business,
there are different types of people who are demanding variety of products that is important for
corporation to provide products accordingly. Forecast means to introduce something firstly than
action which states the accessibility of business operations. In context to TUI, management are
using forecasting tool which helps to perform well and increasing profits. In this organisation
management understand the needs as at what package people want to get hotel, airline and
staying services which helps to provide them that kind of products and services and maintain the
production level. In other words, management are focusing on changing pattern of consumer
demand and make them satisfied (Naji-Azimi and et. al., 2012).
There are different types of factors which can affect the consumers and their needs which are
defined as:
Economic effects – This can be consider as effective changes which are changing the
demand of customers. This is important for organisation to prepare travelling packages as per
income effects of people. This factor influences TUI as it understand different need of people
and introduce holiday travelling packages for classic, economical and luxurious customers which
helps to perform well. This factor may impacts operation of TUI which is defined as:

Positive – By introducing different packages as per customer demand it attracts
customers and encourages them to buy products and services from TUI and increase the
productivity effectively.
Negative – In, business environment people are having different income and TUI is
introducing travelling packages by charging higher amounts from customers and classical people
select other organisation which has impacted negatively as less in number of customers as well
as profit.
Social effects – In current market, the needs, culture, beliefs and attitude is changing
where customers are demanding products as per their status and increase the organisational
profits. In context to TUI, management are focusing on demographic of the population, ages and
lifestyle of society which helps to satisfy the customers.
Positive: By considering needs and lifestyle of people TUI is increasing its travelling
activities and develop more packages which increases operation of business organisation.
Negative: Not focusing on changing demand of customers the operational activities of
TUI would fall and decreases the profits.
Technological effect – This is another factor which has influences the operation of
business organisation by introducing new technology. In context to TUI, management are using
new technology which has impacted on business such as:
Positive – By using new technology, organisation process and operation become easy
which helped to improve the profits. Moreover, it help to reduce the cost and time taken activity
which helps to improve the profits.
Negative – This can be create higher cost for TUI as to adopt new innovation there is
need to invest high amounts which is risky for organisation.
Above are the pattern due to which consumer demand are changing which affects the
organisational activities and make efforts to achieve the business goals effectively.
Uses of different research methodology and sources of research
Capacity and contracting – This method states that organisation should have capacity
and contract to introduce the travelling packages in industry. Such as in TUI, the capacity of
student is 50 who are travelling by using a special rate. The process of contracting includes
transport, accommodation and ancillary services which helps to attracts people and increase the
organisational performance (Moutinho, ed., 2011).

Pricing – This method states what pricing strategy is adopted by management in order to
attracts customers. There are different pricing strategies such as seasonal, competitive, special
offers, discounting and price skimming which attracts customers and retain its customers. In
context to TUI, management are using competitive pricing strategy where it set the prices lower
than its competitors resulting increase in number of customers and high productivity (Naji-Azimi
and et. al., 2012).
Holiday package for the tour
Name of package: Educational tour package
Targetted population: Adult students (Age group between 18 to 25)
Target place: London, UK to Belgium
Targetted number of students: 50
Tour inclusions: Tour is for 7 nights in the city of Ghent an surrounding places.
Prices:
Particulars Cost of tour
Visitor attraction charges £55
Luxury Coach £9157
Local tour guide cost £960
Total £10172
Margin of profit 25%
Total £12715
Task 3
Review the content of range of packages tour programmes which serve similar product market
Tour operation is associates with tour and travel components which are used to create
holiday packages. In business environment, there are many tour operators who are running tour
programmes in order to inform people and increase the organisational productivity. With the help
of tour operators organisation get information which type of tour packages wants customers and
how they can be satisfied (Robinson, Heitmann and Dieke, eds., 2011). This organisation is
running luxury tour programmes for students in which it provides different services at