Tour Operation Management: Analyzing Trends, Decisions & Pricing

This report provides a comprehensive overview of tour operation management, examining current trends and developments impacting the industry, including mass tourism, responsible tourism, and the influence of globalization. It details the stages involved in holiday development, from market research and negotiation to cost assessment, planning, workforce management, and evaluation, outlining a six-month timescale for the process. The report also explores different contracting methods used by tour operators, such as ad hoc, fixed, and sale-only contracts, and discusses the roles of various types of tour operators, including domestic, ground, inbound, and outbound operators. Furthermore, it includes a practical example of calculating holiday selling prices. Finally, the report analyzes strategic and tactical decisions made by tour operators, highlighting the importance of adapting to industry changes and customer needs. This document is available on Desklib, a platform offering a wide range of study resources for students.

TOUR OPERATION MANAGEMENT

Table of Contents
INTRODUCTION................................................................................................................................2
TASK 1..............................................................................................................................................3
1.1 EFFECTS OF CURRENT AND RECENT TRENDS AND DEVELOPMENTS ON THE TOUR
OPERATORS INDUSTRY................................................................................................................3
TASK 2..............................................................................................................................................6
2.1 STAGES AND TIMESCALES IN HOLIDAY DEVELOPMENT........................................................6
2.2 METHODS OF CONTRACTING FOR DIFFERENT COMPONENTS OF THE HOLIDAY AND
DIFFERENT TYPES OF TOUR OPERATOR......................................................................................8
2.3 HOLIDAY SELLING PRICE......................................................................................................10
TASK 3............................................................................................................................................12
3.1 PLANNING DECISIONS TAKEN FOR DESIGN OF A SELECTED BROCHURE............................12
3.2 SUITABILITY OF ALTERNATIVES TO A TRADITIONAL BROCHURES FOR A DIFFERENT KIND
OF TOUR OPERATOR..................................................................................................................13
3.3 THE SUITABILITY OF DIFFERENT METHODS OF DISTRIBUTION THAT CAN BE ADOPTED TO
SELL HOLIDAY.............................................................................................................................14
TASK 4............................................................................................................................................16
4.1 STRATEGIC DECISIONS MADE BY DIFFERENT TYPE OF TOUR OPERATORS.........................16
4.2 COMPARISON OF TACTICAL DECISIONS THAT COULD BE TAKEN BY ADVENTURES ABOARD
...................................................................................................................................................17
CONCLUSION.................................................................................................................................19
REFERENCES...................................................................................................................................20
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INTRODUCTION
The tour operation industry has been attaining development and growth rapidly in the recent
time. In addition to this, the travel and tourism industry is also experiencing several changes
and enhancements in the business environment. This report will be discussing the trends and
changes that are observed in the tour operation industry. Moreover, there are several essential
areas of the tour operation industry which would be effectively understood through the report.
Further, the report discusses the stages essential in holiday development and acquiring selling
price of the tour package (Mason, 2015). There are several kinds of tour packages provided by
the company to the customer’s need and requirement which are developed by considering
several factors. Overall, the report will be helpful in acquiring the required knowledge of the
tour operation industry.
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TASK 1
In recent time, there are various changes and trends that have been observed in the tour
operator industry. The product development team of Trailfinders Ltd. has produced a leaflet
that comprises of the trends and changes that are observed in the industry. In addition,
different sources are used for developing an effective understanding regarding essential aspects
of the industry so that potential strategies for business could be developed.
1.1 EFFECTS OF CURRENT AND RECENT TRENDS AND DEVELOPMENTS ON THE
TOUR OPERATORS INDUSTRY
The tour operator industry is expanded in a
wide area and there are several factors
which support the business functioning
effectively. In the recent time, there are
various changes and trends that have been
observed in the tour operator industry. The
development and trends possess a huge
effect on the tour operator industry. It has
been observed that the tour operator
industry in the UK plays a major role in the
development of their economy. According
to EU Package Travel Directive, the tour
operator is known as an organization that
has brilliance in building tour packages for
the people (Novelli and Hellwig, 2011). The
tour operator industry comprises of several
kinds of tour operators like direct sales
operator, incoming operator, inbound
operator, outbound operator, and special
operators.
The trends and development in the tour
operator industry have been observed in
different areas which could be understood
as follow. There are some big names in the
tour operator industry like Cox & Kings,
Thomas Cook, Thomson, Trailfinders Ltd.,
etc. These companies provide several types
of products and services to their customers.
Currently, the Trailfinders are conducting
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their operation in the cities of the UK and
Ireland with 30 travel centres which are
operating for 47 years. Now, their
operations are conducted in New Zealand,
North & South America, Africa, Australia,
and Asia. The current trends and
requirements of the customers are
considered during the development of the
tour packages (Nunkoo and Smith, 2013). In
addition, suitable enhancements are made
in the business which results in high
profitability for tour operators. The
globalization has also strengthened the
business operations of tour operators.
Figure – Tour Operation Industry
[Source -
http://xmlwriter.net/sample_chapters/Pro
fessional_XML_Design/contents.shtml]
The changes and trends in the tour operator
industry are observed in areas like mass
tourism, holiday sites, product ranges,
responsible tourism, etc. For Trailfinders
Ltd. the mass tourism is an essential tool in
gaining the attention of a large number of
tourist because various types of tour
packages are designed for them. The tour
operator uses exotic holiday sites while
designing the tour package effectively.
Currently, Cruise tourism is the major
market trend that has been growing
speedily. In addition, suitable procedures
are conducted for responsible tourism in
providing maximum satisfaction to the
consumers.
The tour operator industry possesses
several effects like offers, budget airlines,
discount, economy, etc. The recession and
BREXIT issues possess a negative influence
on the economy of the country. Still, the
offers and discounts by the tour operators
are helpful in gaining the attention of
tourist from all over the world. Also, the
airline budget has been varying regularly.
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There are several bodies and authorities
that are managing and handling the tour
operator industry effectively such as The
Travel Association (ABTA), Federation of
Tour Operators (FTO), UK inbound,
Association of Independent Tour Operators
(AITO), and the UK Civil Aviation Authority
(CAA). These bodies effectively fulfil their
responsibility towards the tourist so that
they could enjoy the services in an effective
manner (Nyaruwata, et al. 2016). Thus,
these elements and aspects are helpful in
attaining huge development in the tour
operator industry
.
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TASK 2
INTRODUCTION
The important process in the tour operator industry is considered as holiday development. In
the holiday development, various stages are considered by the tour operator company. A
report has been developed that helps in gaining the adequate understanding of the stages in
holiday developments and the contracts. Further, the process is evaluated through which the
selling price of a tour package could be measured.
BODY
2.1 STAGES AND TIMESCALES IN HOLIDAY DEVELOPMENT
It has been observed that different stages are involved in the holiday development. Further, a
timescale is also designed so that every stage could be easily conducted and managed in a
suitable manner. In addition, the customer needs and requirement are also considered in the
holiday development. The major stages of the holiday development are:
1. Market Research
In the holiday development, the reason for market research is to evaluate the current
trends and changes in the tour operator industry. The aspects which need to be
considered are tourist safety, accommodation facility, destination sites, travelling, etc.
2. Negotiation
The tour operator industry is huge in which several service providers assist the tour
operator in delivering quality products and services to tourists (Papathanassis and
Knolle, 2011). Suitable negotiation is conducted by the tour operator so that they could
manage the service provider’s cost. This helps in designing suitable cost for the holiday
package.
3. Assessment of Cost
It is necessary to assess the cost that has been allocated for the holiday development
such that more cost will be required or not. It is observed that the allocated cost is used
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in major areas for delivering quality services to the customers. The major areas are
known as travelling expenses, service provider cost, research cost, etc.
4. Planning and Scheduling
During the holiday development, it is necessary to suitably plan and schedule the
process for holidays. It helps in accomplishing the required objectives for a certain
period of time. Here, the holiday package of 5 nights is developed of Belgium for 42
students.
5. Managerial Workforce
It is necessary for the tour operator to recruit candidates that possess required skills
and talent so that they could provide quality services to tourists (Potgieter, et al. 2013).
The candidates are selected in the tour operator company on the basis of their
knowledge regarding destination sites, resource utilization, customer requirement, etc.
6. Analyses and Evaluation
Further, the tour operator company scrutinizes the whole holiday development process
effectively for identifying the weak areas so that appropriate measure could be made.
In addition, the customers are approached for their feedback regarding the holiday
package. The holiday development will require 6 months of time and for understanding
the timescale a Gantt chart has been developed.
TIME SCALE I MONTH II MONTH III MONTH IV MONTH V MONTH VI MONTH
Market
Research
Negotiation
Cost
Assessment
Planning
and
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Scheduling
Managerial
Workforce
Analyses
and
Evaluation
2.2 METHODS OF CONTRACTING FOR DIFFERENT COMPONENTS OF THE
HOLIDAY AND DIFFERENT TYPES OF TOUR OPERATOR
The meaning of the contract is a specific deal which occurs between two or more parties under
a legal agreement. The tour operator industry provides the legitimate products and services to
the consumers as per the contract. There are several kinds of contract that are utilized in
holiday development. The holiday development comprises of several aspects like destination
sites, travelling, accommodation, etc. There are some tour contracts which could be utilized by
the tour operator such as:
 Ad Hoc Contract
During the holiday development, the available resources are utilized in an optimal
manner under this contract. The services available in the holiday package as per the
contract could be attained by the consumer on hourly or daily price basis (QUARSHIE,
2010). This contract could be utilized by Trailfinders Ltd. in maintaining their financials
and also attaining confirmation from customers through emails.
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 Fixed Contract
This contract is available for the certain period of time and then it expires. It is highly
used in the tour operator industry for gaining huge sale of the products and services
because the tour operator booked the services in advance due to cost-effectiveness.
 Sale Only Contract
Under this contract, the tour packages are sold to customers at high prices in
comparison to fixed contract (Slivar and Pavlović, 2012). The contract is developed
during the requirement and need of the consumers.
The tour operator effectively chooses the appropriate contract in order to develop the suitable
holiday package for the customers. Further, the company assists the customers in choosing the
appropriate holiday package so that their need and requirement could be fulfilled. There are
various kinds of the tour operator that are available in the tour operator industry like:
 Domestic Tour Operator
The tour operator works at the domestic level like providing the tour packages to the
customers in the host country. Also, they provide the required assistance to them in
visiting the sites in the host country.
 Ground Operator
The ground operator is also called service provider in the tour operator industry as they
manage the accommodation, travelling, booking, etc. of the customers (Swarbrooke and
Page, 2012). They also provide the required assistance to the tour operator in terms of
services.
 Inbound Tour Operator
The inbound tour operator is directly linked with the tourists such that they provide the
required services to them from their arrival at the site to their departure.
 Outbound Tour Operator
There are various products and services that are provided by the outbound tour
operator to the local as well as the international tourist in the country.
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2.3 HOLIDAY SELLING PRICE
The Grand Casselbergh of Bruges has been proposing a tour package to Trailfinders Ltd. as they
are conducting the tour for 42 students. The hotel is charging for two individuals in a single for
a day align with a breakfast by 96 euros. A luxury coach of 48 seat capacity will be provided
with two drivers in £11,200 that also included taxes, fuel, tour manager, and other expenses
(Tsiotsou and Ratten, 2010). Also, a local guide will be provided for the tour under £945. The
Trailfinders Ltd. has considered the offer and they are asking for the markup of 33% on the
entire deal. The selling price of the tour package for a single student has been provided as
follows:
Various Facilities Calculation Cost
Cost of Rooms and Breakfast 42*96*5 € 20,160.00
Overall cost € 20,160.00
1 euro = 0.892 pounds
Cost in pounds 20,160.00*0.892 £ 17,942.72
Cost of guide £ 945.00
Cost of bus £ 11,200.00
The total cost of the tour package is £30,087.72
After making the markup of 33% for the cost of tour package is £10,029.24
The final cost of the tour package is £40,116.96
There are 42 students for the tour and the cost of tour package for the single student could be
determined by £40,116.96/42 = £955.16
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CONCLUSION
The report helps in depicting the effectiveness of the major areas in the tour operator industry
effectively. The major areas are hostages in the holiday development, contracts, and types of
the tour operator. Moreover, the report helps in understanding the process of determining the
selling price of a tour package.
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