Tour Operations Management: Strategic and Tactical Decisions Report

This report analyzes the tour operations management industry, focusing on the operations of Trailfinders Ltd. It begins by examining the effects of current trends and developments in the industry. The report then details the stages involved in developing holiday packages, including market research, planning, contracting, costing, financial evaluation, brochure design, advertisement, operations, and post-tour management. Different methods of contracting, such as fixed, sale-only, and ad-hoc contracts, are evaluated for their suitability. The report also covers the selling price of a holiday package, providing a cost breakdown. Furthermore, it explores planning decisions for brochure design and the suitability of alternatives to traditional brochures. Different methods of distributing holiday packages are also assessed. Finally, the report analyzes strategic and tactical decisions made by various types of tour operators, particularly in the context of Trailfinders Ltd.

Tour operations management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Effects of current trends and development on tour operations industry...........................1
Covered in Leaflet..................................................................................................................1
TASK 2............................................................................................................................................1
2.1 Stages and timescales involved in development of holidays ...........................................1
2.2 Suitability of different methods of contracting for different components of holidays.....3
Different types of tour operators............................................................................................4
2.3 Selling price of holiday package. ....................................................................................4
TASK 3............................................................................................................................................5
3.1 Planning decisions taken for design of selected brochure................................................5
3.2 Suitability of alternatives to traditional brochure for different types tour operators........6
3.3 Suitability of different methods of distribution used to sell a holiday package...............7
TASK 4............................................................................................................................................8
4.1 Strategic decision made by different types of tour operator.............................................8
4.2 Tactical decisions that could be taken by selected tour operator in different situation....9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Tour operations industry has been identified as most significant sector that has an
integrated approach towards travel and tourism. It involves management of various operations
that includes development of holiday packages, monitoring current trends and strategic decisions
that need to be taken by tour operators (Gibson, 2012). Present report is based on analysis of
effects of current and recent trends and development on tour operations industry. As a product
development manager at Trailfinders Ltd, which is travel company in the UK and Ireland, there
are different stages involved in development of holiday’s packages are also discussed along with
the suitability of different methods of contracting for various components of holidays. In addition
to this, selling prices for tour package is determined in the report. Moreover, planning decisions
are taken for selected brochure by different tour operators are also discussed. Suitability of
alternatives to traditional brochure for various kinds of tour operations. Further, different
methods used for selling of holiday packages are also evaluated. At last, strategic decision made
by various kinds of tour operator are analysed along with the tactical decision that needs to be
taken Trailfinders Ltd.
TASK 1
1.1 Effects of current trends and development on tour operations industry
Covered in Leaflet
TASK 2
2.1 Stages and timescales involved in development of holidays
Planning is has analysed very important aspect in tour operations industry. It is required
for tourism service providers to plan activities in sequential basis for development of holiday’s
packages which will attract the tourists.
There are various stages involved in development of holiday’s packages which needs to be
followed by Trailfinders Ltd. These important steps are mentioned below
 Market research: It mainly involves overall research of the tourism and environment of
country to identify the trends as well as factors that direct affects decisions of holiday’s
packages (Robinson and et.al., 2016). Moreover, research of market includes economic
which provided clear understanding about culture of country and spending power of
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people in country. With appropriate market study Trailfinders will be able to take
appropriate decision regarding prices, service and requirement of customers.
 Planning and scheduling: This step of development involves planning and taking
decision regarding locations, accommodation, travelling cost (Evans, Stonehouse and
Campbell, 2012). Transportation services, amenities and attractive that needs to be visited
etc. has been taken in to consideration. Trailfinders needs to make proper schedule of
these activities.
 Contracting: At this stage, a manager of Trailfinders tends to create a contract and sign a
contract with its customers. All terms and conditions, activities and prices are mentioned
in tourism contracts. It is legal formality and needs to be accomplished by organisation
without mistake.
 Costing: This stage involves analysis and measurement of cost that needs to be incurred
by organization in a particular holiday’s package. Budget for every tour package has been
made Trailfinders in their tour packages (Redjem and Marcon, 2016). With appropriate
analysis of cost, organisation can set selling price of holidays packages and also able to
influence its customers towards products and services.
 Financial evaluation and pricing: This stage involves calculation of expenses and profit
margins on holidays to analyse the fluctuation in prices of products and services. Through
effective financial evaluation, Trailfinders will set effective selling prices for their
holidays. This helps in identification of tax burden and other additional expenses.
 Brochure: It is a document that involves all information related to different holidays
which were offered by Trailfinders to their customers. Development of Brochure is
essential for creating awareness about tour and prices among people (Medlik, 2016).
Design should be effective so that it attracts customers and should also provide basic
information of tourist destinations.
 Advertisement: At this stage, company needs to select an appropriate method of
advertisement that covers less cost and helps in providing information about holiday
package to large population (Guo and He, 2012). For example: social media applications,
direct mails, company websites, brochure, templates and digital advertisement are most
effective channels of advertisement that needs to be applied by organisation for
development of tour packages.
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 Operations and implementation: This step mainly includes steps like deposits, booking
of tickets and development of checklist. This stage deals with practical applications of
actions for planning of tour.
 Post tour Management: This stage involves evaluation of performance after
implementation of tour package. In this, Trailfinders will take feedback from individual
associated with the tour in order to create change in next tour package (Jones and
Robinson, 2012). Through this, managers will tend to identify problem faces by
customers and they also find ways to resolve those issues.
2.2 Suitability of different methods of contracting for different components of holidays.
In law terms, contracts are analysed as agreements that needs to be signed by two parties
when they agree on the terms and condition of contract. In terms of tourism industry, contract
relationship exists between tour operators, tourists and service providers which is essential to
resolve disputes. There are various kinds of contracts that needs to signed by associated parties to
protect themselves from nay kinds of legal issue related to travel and tourism.
Fixed contracts: In these kinds of contract, organisation focus upon the collective as well as
quantitative approach for selling tour packages (Kerzner and Kerzner, 2017). Tour operators
increase their capacity through maximizing sales volume. This kinds contract is done to take
benefits to season in which they have fewer demands. In this, Trailfinders will create fixed
contract with the customers and service providers to increase cost effectiveness and getting more
discount. Further, it is less effective because trailfinders also needs to pay amount in case of non
utilization of services. For example: When the Trailfinders have booked 50 seats for their clients
but only 45 seats were occupied then company also needs to pay the amount of extra seats.
Sale only contract: These are analysed as seasonal contracts which are made by considering the
demands of holidays packages among customers (Witt, Brooke and Buckley, 2013). In sale only
contracts, Trailfinders needs to pay the price for only those services which are used by their
customers. It is essential at the time of over booking and company will get support in purchasing
additional services. There is no scope of discounts in these kinds of contracts.
Ad-hoc contracts: This type of contracts also deals with overbooking and company is required
to make extra booking of seats or accommodation (B. DiPietro, Cao and Partlow, 2013). These
kinds of contracts are mainly signed by specialised tour operators.
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Different types of tour operators
There are various kinds tour operators that exists in tour operations industry and responsible
towards development of holiday packages.
Inbound: These are the organisation that provide travel and tourism service for people in
home countries and these are considered as in bound tour operators. For example: organisation
like Thomas cook and England tours are analysed as In bound tour operators.
Outbound: Travel companies having business operations in different nations developes
tour packages for different people living in different nations. These tour operators generally have
their business operations at international level (Grant, Wong and Trautrims, 2017). Trailfinders
limit is also outbound travel company which has 29 branches in different countries.
Domestic: it mainly involves those tour operators which are responsible for formulation
of tour packages for the clients of home countries (Naji-Azimi and et.al., 2012). They also have
different branches in different city of home country. For example: Thomas cook and TUI group
are two major domestic tour operators which has their various branches in UK.
Specialist: These organisations are specialised for creation for the development of some
specific and unique kinds of holiday package. For instance : tour package which are developed
by Trailfinders for their customers different parts of world. For example: HF holidays and Trail
finders are specialist tour operators.
2.3 Selling price of holiday package.
Expense Type Cost (in Pound)
Cost of Hotel 120
Cost of accommodation 2000
Cost of Luxury Coach 7,400
Cost of local tour guide 920
Total 10440
30 percent profit margin 3132
Working notes
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1.15 Euro=1 Pound
90/1.5*1= 60
60 Euros= 1 Pound
Cost of room (2 adults sharing) 60* 1= 60 Euros
Number of rooms required 40/2 = 20
Cost of hotel =20 rooms for one night = 60*20= 120 pounds
Cost of 5 nights= 120*5 = 600 Pounds
BB for 1 = 10*1 = 10
Cost 40 people on 5 nights = 40*5* 10= 2000
Cost of 45-seater luxury coach is £7,400 including road, ferry and taxes
Cost of a local tour guide is €920
Total cost for package: 10440+3132= 13572
Cost for an individual: 13572 /40 =339
TASK 3
3.1 Planning decisions taken for design of selected brochure.
There are various important planning decision that needs to be taken by Trailfinders Ltd
in planning and demonstration of effective business decisions. Brochure is analysed as
documents that contains all the information about the tour packages which are developed by
organisation. These activities are clearly classified in tour packages of operators. This is also
analysed as method of techniques for the market that involves the low cost. Company will also
distribute their brochures from both online and offline methods (Hoffman, Padberg and Rinaldi,
2013). Digitalization methods and improved technologies also provide support to organisation in
increasing the reach of brochure.
Design: It is the most important decision that needs to taken by managers of Trailfinders to
attract customers. Moreover, selection of appropriate design is important to attract clients. Large
scale companies hire advertisement agencies for development of brochure. Organisation also
needs to take decisions about things that needs to be included in brochure.
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Cost: The major aspect that needs to be consider is the cost of operators. Decision related to
budget of developing brochures needs to be taken by managers. Cost of development involve
printing charges, designing charge, paper charge and distribute expenses etc.
Format: It implies to decision related to font, size, shape and colour that needs to be taken by
organisation while planning for development of brochure (Sigala, 2014). Appropriate design and
colour needs to be selected so that it may attract people and attractive picture of tourist
destination must be used in brochure which clearly provide information about different locations.
Target Market Decision related to target market also needs top be taken by management while
creation of Broshure. In this, trail finders have target local and medium class customers who
desire to buy these tour packages.
3.2 Suitability of alternatives to traditional brochure for different types tour operators.
With the advancement of technology, there are various kinds of brochure have been used
by organization to provide information and attracting customers. Many new methods of
advertisements and communication have been used by introduced to replace the brochures. Some
of them are mentioned above:
 Press: It implies to print media such as Newspaper, magazines and templates which are
mostly used by tour operators to promote their tour packages (Al-Odeh and Smallwood,
2012). It is traditional method of developing Brochure which is used by tour operators.
 E Brochures: These are considered as electronic brochure which are available online and
used by tour operators to make their communication more effective. It is effective as it
involves less time and efforts for distribution. Utilization of internet is identified as
common in present scenario and people are more attracted towards E brochures.
 Social media: It is identified as inexpensive method used for promotion of tour packages
which has replaced the traditional brochure technique (Wang, 2012). Through this
brochure, Trail finders will be able to attract new and retain their old customers without
any charges. They can also stay connected with large number of population and provide
them information about new services.
 Leaflets: Trailfinders also use this method which is a single page advertisement which is
formulated at last minute to deliver the brief information of products and services to
limited audience.
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 Business events: Various business events have been organised by large scale companies
for their employees and stakeholder. Trailfinders can also promote their holiday packages
in those events and also make sponsorship in these business events. Through this,
company will be able attract to business class customers.
 Outdoor media: It implies to advertisement which is given by tour operators on out door
media such as buses, Walls and public notice boards etc. this method helps Trailfinders to
create awareness about products and service among its target customers.
 Mobile applications: Various applications have been developed by organisation to
promote their business in market. Trailfinders can also develop their own business
applications to attract customers from different countries.
However, the most suitable media for Trailfinder Ltd. It is analysed as E brochures
because it is easily available online and it can be transferred to people through direct mails and
companies websites etc. It contains less cost and efforts as compared to print media.
3.3 Suitability of different methods of distribution used to sell a holiday package.
Company operating in tourism industry needs to adopt effective ways for distribution of
information and products. Distribution is identified as important ways of movemenet of products
from seller to buyer which can be direct or indirect (Pohl, 2014). Moreover, direct distribution
method allow the organisation to make direct contact with their customers while indirect method
include mediators who are connected with company and sell their product in market. In this
context, both direct and indirect method of distribution is use by Trail Finders Lt.d which are
mentioned Above:
Direct channels: It implies to direct selling of product without any intervention of intermediaries.
This is effective for trail finders and provide support in making influence on customers to
purchase products and services (Gibson, 2012).
Indirect channels: it involves intermediaries who have relationship with organisation and
responsible for selling of their products and service to customers. It is costly method because
organisation also needs to bear the cost intermediaries.
Methods of distribution used by different tour operators which are as follows:
 Online travel agencies: These are types of service that may or may not be present. These
agencies have their own websites and call centres through which they communicate with
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clients and sell holidays packages of Trail finders (Camilleri, 2014). They also direct
booking facilities to customers and online payments methods. It tends to reduce efforts of
customers and provide various choice which can be selected by customers.
 Government Websites: In UK, government also provides an platform to travel and
tourism companies for promotion and distribution of information through government
websites (Medlik, S. ed., 2016). These websites are mainly for local tour operators who
deals with native tourists.
 Visitors information centres: At these centres, tour operators are allowed to put their
leaflets and flyers. Tourist can approach these centres and find best tour packages for
them.
TASK 4
4.1 Strategic decision made by different types of tour operator.
Tour operators industry are very much focused on development of tours packages
through which they can attract more people towards their organisation. Continuous changing
scenario of tour operators industry has also provided influence tour operators to make strategic
decision through which they will be able to attract more customers and sustain their business
operators in competitive business environment (Guo and He, 2012). In this context, there are
various important strategic decision which are taken by different tour operators in country which
are mentioned below: STP analysis: In order to sell every tour packages, analysis of selected customers is
important decision which is taken by tor operators along with the positioning of products
and services which has been provided by them in such as way that it promotes tour
operations of enterprise. Selection and targeting of potential will enable Trailfinders to
sell their products effectively (Grant, Wong and Trautrims, 2017). Through this,
company can directly adopt their effective methods for promotion of products and
services in market. Along with this, positioning strategic is also important decision which
implies selection of market in which the company tends to position their business. It
depends upon the selection of prices and service. Trailfinders has adopted low prices for
their services as compared to customers and tends to position their business at national
level. They have also adopted this strategy because it helps them in expansion of
customers base and business operations in different countries.
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 Seasonal strategy: It implies strategic decision which are formulated and implemented by
tourism companies for regulations of their business operations in different seasons. Trail
finders also develop tour packages for different seasons and prices are also charged as per
demand of products and service. In Festive seasons, high pricing are charged by
Trailfinders on booking of holiday packages. Various decision related to services and
activities which are provided to customers will be taken by Trailfinders. Competitive pricing: It is also analysed strategic which needs to be taken by company to
increase their customers and promote business operations. Development of competitive
pricing policies involves the selection of appropriate prices for products and service after
analysing the prices which are charged by competitors in market for similar products and
services. In this context, Trailfinders needs to analyse pricing policies and services which
are offered by its competitors to identify method which needs to be applied for selection
of appropriate holidays package.
 Promote innovation: Decision related to continuous innovation of products and service
are also needs to be taken by management which provide support in development of tour
packages. Market research is most important tool which provide understanding to
Trailfinders that needs to be made in products and service by organization attract
consumers. Continuous innovation in products and services also provide support increas
4.2 Tactical decisions that could be taken by selected tour operator in different situation.
Tactical decision are helpful for the business unit in smooth functioning of the business
unit. It allows the firm in managing operations well and avoiding errors. Correct decision are
helpful for the business unit in order to raise profit and enhancing satisfaction level of consumers
(Sotiriadis, 2015). There are many external factors that impact on the business unit to great
extent. For example if government makes changes in the regulations then it would be difficult for
the business unit to carry out the operations in smooth manner. In such condition it has to modify
its practices so that it can run its firm legally. In such condition Trailfinders has to develop
healthy relationship with employees.
This will support in making changes in operations. Trailfinders is the international
operator, it provides travel facilities to travellers globally. But due to fluctuation in currency
exchange rate entity has to face many difficulties (Redjem and Marcon, 2016). In such situation
cited firm has to make tactical decision so that fluctuation do not affect revenues of the firm.
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Company has to conduct market research and have to clearly communicate information with
consumers regarding the fluctuation in the currency rates. So that if price gets changed then they
do not cancel their trip. Furthermore, if there is inflation then people will not plan for travelling
to other nation. In such condition entity has to make tactical decision of implementing effective
pricing strategy (Camilleri, 2014.). If Trailfinders provides facility to the consumers at fair prices
then consumers will take interest and they will buy its services. Most of the people cancel their
plan to travel because of high prices. But if entity adopt effective pricing strategy then it would
beneficial for the organization in attracting more buyers and dealing with complicated situation
well. By this way organization can success in the market and can sustain for longer duration.
CONCLUSION
In this report, it is been concluded that there are various important trends and
development have been occurred which has provided both positive and negative impact on tour
operations industry. Implementation of information and communication technology by tour
operators in identified as important for success of Trailfinders Ltd. Tour operations industry has
also achieved growth with increase in demand and supply of product or services. Analysis of
strategic decision provides clear understanding that company needs to adopt competitive pricing
policies to raise its customers. Planning of brochure involves decision related to design, format
and cost needs to be taken by management for promotion of products and services.
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