Tour Operation Management: Analysis of Industry Developments Report

This report provides a comprehensive analysis of tour operation management, covering recent developments in the tourism industry, the stages involved in designing holiday packages, and the evaluation of contract destinations and attractions. It delves into calculating the selling price of a holiday package, assessing the suitability of brochure designs and distribution methods, and evaluating the strategic decisions made by various tour operators. The report uses a case study involving a sightseeing tour from London to Paris for Chinese students, providing practical examples and insights into the key aspects of successful tour operation management. It explores the importance of market research, negotiation, and marketing in the planning process, as well as the significance of customer satisfaction and strategic alliances with suppliers. The report also discusses pricing strategies, contract types, and the impact of e-commerce and mobile technology on the industry.

Tour Operation
Management
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................4
TASK 1............................................................................................................................................4
1.1 Recent development in tourism industry...............................................................................4
TASK 2............................................................................................................................................5
2.1 Determining the stages and time scale involved in designing holiday packages..................5
2.2 Evaluating the suitability of different contract destinations and attractions involved in
developing holiday packages.......................................................................................................7
2.3 Calculating the selling price of the holiday package.............................................................8
TASK 3............................................................................................................................................9
3.1 Evaluating the planning decisions taken for the design of a selected brochure....................9
3.2 Assessing the suitability of alternatives to a traditional brochure for various kinds of tour
operators.....................................................................................................................................11
3.3 Evaluate the suitability of different methods of distribution used to sell holiday for
different types of tour operators.................................................................................................12
TASK 4..........................................................................................................................................13
4.1 Evaluating the strategic decisions made by various types of tour operators.......................13
4.2 Comparing the tactical decisions that could be taken by chosen tour operator in contrasting
situations....................................................................................................................................14
CONCLUSION..............................................................................................................................14
REFERENCE.................................................................................................................................15
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INTRODUCTION
Travel and tourism is considered as one of the most prosperous industries in the current
market consideration because sector is having various opportunities in the market. Industry also
contributes 10% of overall GDP that enhances opportunities in the global level. There are
number of sub sections that provide support in a collective manner to meet the sustainable
objectives of travel and tourism sector (Damonte, 2013). Travel and tourism sector is progressing
at a fast pace and work as an economic booster.
In the present report, various factors that are related to the working of tour operators will
be analysed in an appropriate manner so that key aspects of success can be evaluated. It will
provide learning about key stages that need to be considered effectively for the creation of tour
plan. Along with this, information about number of alternative ways to design and distribute the
brochure will also be presented in the report. Furthermore, learning will also focus on the
strategic decisions that are made by tour operators in order to meet the goals and objectives.
TASK 1
1.1 Recent development in tourism industry
As per the detailed study, travel and tourism sector is referred as the fastest growing
industry in the current market conditions. It means that the sector is generating high ratio of
revenue which is beneficial for the advancement in economic system. It has been noticed in the
recent past years that sector is having continuous improvement by 4-5 percent with regard to
international market (Dezdar, 2012). It is expected that the ratio will be enhanced by 1-2 percent
in the upcoming years. Therefore, it can be clearly witnessed that there is large number of
opportunities available in the industry. In addition to this, there are number of developments that
sector has gained in the recent years so that standards of sustainable opportunities can be
accomplished (Jayawardena, 2013).
Along with this, use of e-commerce and technological tools has also increased in the
recent years which have also boosted opportunities for the organisations. In this respect,
management of Thompson has also introduced its mobile access web portal so that customers
can have better approach to the services. With an improved focus on e-commerce and mobile
technology, businesses have increased their customer base in international market (Voxted,
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2011). Nowadays customers are more attracted towards the use of mobile applications in order to
book orders of tour package. Customers are demanding to gather information about plan and
destination in an easy manner (Huang, 2008). So, in this respect, businesses have started using
virtual technology. With an assistance of this, customers can visit to official website of tour
companies and experience the virtual tour of attractions and destinations. Images, videos and
other elements are being used for ensuring that the customers are attracted towards virtual tour
technology (Keillor, 2012).
Moreover, transportation medium preference has also been changed in the recent years
so; tour operators are now focused towards contract or strategic alliances with airline firms. It is
because; customers now prefer the use of airline services. Different types of tour packages are
also offered to the clients according to their key needs and expectations. For example,
customized tour plan is one of the great options that help businesses to ensure that customers
needs have been fulfilled (Krogerus, 2011). In addition to this, travellers are also focused
towards destination that provides better experience. So, authorities are nowadays focused
towards the development of unique attractions. It has increased the opportunities for travel and
tourism sector in the recent years. Number of new policies has been formed by businesses and
government so that barriers to the sector can be overcome in an effective manner. Along with
this, number of discount and offers are also offered by businesses to attract more customers and
lead business to impressive level of success (Lee, 2011).
TASK 2
2.1 Determining the stages and time scale involved in designing holiday packages
As per the detailed evaluation of case study, company is looking forward to introduce a
new plan for sightseeing tour from London to Paris. It will be offered to 15 Chinese students and
time period of the package will be 5 days. It has also been proposed that the tour will be in
operation from August 2018. It is also significant for the management of Thompson to have
effective planning of tour package as per the industrial standards and customer needs. It will
facilitate in advancing the satisfaction level among customers and lead business to impressive
level of success (Wheeler, 2011). It has been noticed that the success of tour plan depends upon
proper availability of resources, information about customer’s needs and preferences, etc.
Effective designing of time frame is also essential so that tasks can be accomplished in an
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appropriate manner in order to lead business to sustainable development (Brookes and Ringham,
2014). However, the classification of stages can be like destination analysis, market research,
negotiation and marketing.
It means that management needs to analyse the key features of London and Paris in an
appropriate manner so that tour plan can be designed effectually. For example, information with
regard to London Eye, Effiel Tower and other attractions need to be evaluated. It will assist in
deciding the destination which is appropriate as per the expectations of Chinese students. After
this, it is also essential for the management of Thompson to have consideration of market
research activities because it facilitates in gathering significant information about destination
(Blanke and Chiesa, 2013). With an assistance of this, current situation of the selected
destination needs to be identified so that further decisions can be taken into account. It is
essential to evaluate diverse factors such as political, social, economic, etc. Other than this,
security of travellers is one of the key issues that affect the growth of sector. So, management
needs to ensure that security measures are well managed (Crysta and Law, 2011). Details with
regard to local service provider are also needed to be researched so that further implications can
be taken into account for sustainable development.
Along with this, negotiation is also one of the critical stages of tour planning because it
allows businesses to have effective bargaining with regard to services and costs. It plays a vital
role in the selection of services because it provides prime quality at appropriate price (Felfernig
and et. al., 2009). It is significant for Thompson to have selection of suppliers as per their brand
image in the market so that key industrial standards can be followed effectually. At last,
marketing of designed package is also essential because it allows sharing information about
services within market. It is beneficial to attract customers and ensure that the services are being
sold for sustainable development (Jayawardena, 2013).
Activity Time Frame
Analysing the destination 1 Month
Market Research 2 Months
Negotiation 2 Weeks
Marketing the tour package 3 Weeks
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2.2 Evaluating the suitability of different contract destinations and attractions involved in
developing holiday packages
In order to have sustainable development, tour package must be designed as per the
consideration of suitability, destination and attractions. It is important for the management of
Thompson to have designed holiday package as per the needs of customers. If business firm is
not considering customer expectations in an appropriate manner then it might affect the overall
business negatively (Kim and Lehto, 2012). In addition to this, support from suppliers and other
mediums is significant so, it is vital for the management of Thompson to have better relationship
with diverse mediums.
Fixed contract is considered as an essential method that helps tour service providers to
have agreement with suppliers as per the reference of volume based capacity. It is necessary for
management to acquire service in bulk manner so that requirements of customers can be
accomplished appropriately (Korstanje and George, 2012). This method is generally used in peak
season where tour operators reserve the maximum services offered by various suppliers. It is also
beneficial to enhance the profit margin ratio because method allows meeting customers in the
desired manner. With an assistance of fixed contract, bulk purchase activity can be accomplished
that allows business to offer discount on the services (Lignau, 2013).
On the other side, only for sale contact is another kind of contract that allows business to
have specific selection of services as per the specific needs of customers. It is mostly adopted by
the business firm during time period of lean season. It also allows overcoming the issue of
wastage of resources which is beneficial to have optimum utilisation of key available elements.
In addition to this, it can also be stated that the business entity like Thompson needs to focus on
contracting with hotels (Becker and Cosmas, 2014). Lodging and accommodation are considered
as the most essential section in tour package services so; management also needs to have
contracting with hotels in order to meet such kind of requirements. It has been noticed that
preferences of clients must be considered during contracting formation with diverse suppliers.
Support of other tour agencies is also required in order to meet the objectives (Henriques and
Richardson, 2013). It means that short term strategic agreements can also be taken into account
to ensure that company is offering safe services to the passengers.
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2.3 Calculating the selling price of the holiday package
In addition to tour package, it can be stated that there are number of key aspects that need
to be evaluated effectively for effective designing of holiday package. Classification of factors
can be as costing in regard to transportation, lodging, entertainment and other charges. If
company is not having appropriate information in regard to costing then pricing of package can
not be designed in desired form. It means the management of Thomson also need to consider
total cost incurred on acquisition of diverse services (Hitt, 2010). It has been noticed that there
are number of pricing strategies that can be adopted by the business entity in order to meet the
objectives. Classification of pricing strategies can be as price skimming, cost plus, leadership,
competitive and penetration pricing. It is significant for business entity to have understanding
about diverse factors of costing so that issues can be resolved in appropriate manner. Selection of
pricing must be in such manner that the costing of operational activities is covered effectively
(Lages and Simkin, 2013).
As per the detailed analysis of the current case, the Thomson is focused towards cost plus
pricing strategy. It allows business firm to acquire profit by 10 percent on the services which is
offered to Chinese students. In addition to this, the strategic alliance with St Michelle Hotel
allows to meet standards of accommodation services. It will cost around 60 euro for twin room
which can be shared with 2 students. It means the total 8 rooms will be acquired by the Thomson
because tour package is for 15 students. Expenditure in respect to food and beverage will be
119.25 pound. Other than this, the local guide will charge 200 pounds for overall package.
Services Selling price for 15 students
(£)
Reservation in St
Michelle
10 (euro)x8= 381.36
Food and Beverage 7.95x15= 119.25
Surface transportation 1000
Local Guide 200
TOTAL 1700.61
Margin of 10 percent 170.61
Selling price 1870
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Profit gained by the organisation in the package is recorded as 10 percent, it means the
operational cost is covered in appropriate manner. It also indicates that the overall pricing of
holiday package can be reduced by having a negotiation with suppliers (Marcotte and Bourdeau,
2012). Selected cost is also appropriate as per needs of customers so management can easily
meet the satisfaction standards for sustainable development.
TASK 3
3.1 Evaluating the planning decisions taken for the design of a selected brochure
Brochure is designed as a booklet that provides information about services and products
so that customer can understand the key feature offered by company. It is beneficial to attract
more and more customers and lead business to impressive level of success. In addition to this,
the brochure is simply considered as the pamphlet that is designed by tourism business in order
to share information about products and services which is offered to customers. It is not only a
medium of information sharing but also a factor that can increase the customer base. It has been
noticed that companies are focused towards both traditional and modern brochure in order to lead
businesses to impressive level of success (Anderson, 2011). Traditional methods are mostly used
with an assistance of print media so that information can be shared. On the other side, the
modern methods are more involved with the e-brochure techniques. It allows to have access of
various technological tools in order to meet goals and objectives. In order to design the brochure
the management of Thomson need to focus on few steps (O'Connor, 2011).
Firstly the determination of the format is essential because it allows to have effective
designing of brochure. In this, the factors like quality of paper, border and writing style are
considered to design structure of brochure. If these aspects are not well managed then it might
affect the overall development in negative manner because it will cut down the attractive
features. After this, the decision in respect to the pricing is also essential because it allows to
decide overall pricing of package. Cost of brochure creation also need to be evaluated in
appropriate manner so that development and designing activities need to be considered
effectively (Crysta, 2011). Information about the destination also need to be considered so that
details about the package and services offered can be mentioned in the brochure.
Other than this, the brochure also need to be designed in such manner that the potential
target customer can get attracted towards it in effective manner. E-brochure can be designed in
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such form that they can be downloaded on laptops and mobile phones. At last the decision in
regard to print specification also need to be taken into account so that designing activities can be
accomplished (Thal, 2013). This process will involve designing of captivating cover page of the
brochure. Along with this, the brand name, pricing of package, destination information, graphics
these all are factors that may impact the effectiveness of brochure. Information in regard to
overall time period of plan must be provided in brochure to avoid miscommunication issue.
Moreover, the contact details for further information also need to shared in the brochure (Lignau,
2013).
Paris Tour
5 Days package
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Contact for further details:
Thomson
3.2 Assessing the suitability of alternatives to a traditional brochure for various kinds of tour
operators
In order to have sustainable development, it is significant for the management of
Thomson to focus on alternative ways of brochures. It will assist in operating business in more
appropriate manner and lead business to impressive level of success. It has been noticed that the
brochure is considered as most significant aspect that provides a better opportunities to the
business. It is one of most commonly used marketing tool. In this respect, the management of
Thomson can focus on e-brochure and online brochure so that goals and objectives can be
accomplished effectively. Along with this, the soft copy of brochure can also be shared on the
official portal of business entity (Mehmetoglu and Norman, 2013). It allows business firm to
share information about tour package in effective manner. It also reduces the cost of marketing
activities and provide better opportunities in the current market conditions.
Other than this, it is also environment friendly method because it does not have use of
paper. In this, organisations can focus on use of mobile application so that brochure can be
downloaded by the customers on their cellphones. In addition to this, the brochure format must
be designed in such manner that the information can be modified and updated in appropriate
manner as per the consideration of business and its requirement (Rana, 2014). It is also necessary
for the business entity to focus on effective designing of website so that interaction aspects can
be maintained in desired form. Use of videos is also one of significant method that can be used
by the management of Thomson in order to have effective use of modern techniques of brochure.
Videos can be published on the official website and you-tube to create awareness about plan and
company. It will also enhance the customer base of business entity and lead organisation to
impressive level of success. Other than this, audio can be published to share information about
the destination (Tani, 2014). It will attract more and more guest which is beneficial to meet the
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goals and objectives. In videos it is necessary to reflect the key aspects of tour package and Paris
so that more and more Chinese students can get attracted towards services.
E-brochure and other modern factors can also be shared on the social media networking
so that visibility aspects can be well maintained. Modern tools of brochure are appropriate for the
business because it is cost effective as compared to traditional methods of brochure (Damonte,
2013).
3.3 Evaluate the suitability of different methods of distribution used to sell holiday for different
types of tour operators
It is significant for the management of Thomson to have effective use of distribution
channels so that more and more employees can be attracted towards business. With an improved
focus on method of distribution in limited period of time the customer base can be improved. It
has been noticed that there are two kinds of tour operators that operate business in the industry.
Classification can be as mass and specialised tour operators. Specialised tour operators are
focused towards specific needs of customers (Dezdar, 2012). Cox and Kings is considered as
specialised tour operator and Thomson as mass tour operator. In addition to the specialised tour
operators the businesses mostly focused towards premium and luxurious services so that needs of
diverse customers can be accomplished in appropriate manner. On the other hand the mass tour
operator are mostly focused towards offering wide range of services. Classification of services
can be as accommodation, recreation and other supportive services (Jayawardena, 2013).
In order to have effective distribution, the management need to make sure that the
convenience factor is being considered in appropriate manner. By having a use of email the
brochures can be distributed in appropriate manner so that more customers can be attracted. It
will enhance the sales of ratio of company and lead business to impressive level of success. It has
been noticed that there are number of distribution channels that can be adopted by the business
entity (Voxted, 2011). Classification of channels can be as online marketing, direct selling,
agencies support, call centre, etc. Thomson can adopt online advertising technique to increase
sales ratio because it attracts high range of customers in less time period. Executives can also
focus on direct sales approach in order to create better opportunities for the organisation (Huang,
2008). Use of official website to share information about package is also beneficial to meet the
objectives and increase overall sales ratio.
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