Tour Operations Management: Functions, Strategies, and Decision Making

This report provides a comprehensive analysis of tour operations management, examining the functions and roles of tour operators, the structure and scale of the tour operating industry, and the stages involved in creating effective holiday packages. The report uses TUI (Thomson Holidays) as a case study, exploring its operations, product development, and decision-making processes. It covers aspects such as planning tours, making tour packages, reservation systems, and promotion strategies. The report also discusses the importance of understanding consumer needs, market research, and the justification for different tour programs. Furthermore, it analyzes strategic and tactical decision-making within tour operations, offering examples of how operators make choices to meet market demands and achieve business objectives. The report highlights the significance of direct distribution channels and the components of an effective holiday package in the competitive tourism market.

Tour Operations Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Various functions and roles of a large number of tour operators..........................................1
P2 Justification of structure and scale of the tour operating industry.........................................3
Structure of Tour Operating industry..........................................................................................4
TASK 2............................................................................................................................................5
P3 Several components and stages in order to create effective holiday package of various tour
operator needs.............................................................................................................................5
P4 Elaborate changes in the consumer need and demand by using various sources of research.
.....................................................................................................................................................6
TASK 3............................................................................................................................................7
P5 Justification of the higher range of package tour programmes in which they provide similar
product market............................................................................................................................7
TASK 4............................................................................................................................................9
P6 Various examples of tactical and strategic decision making in the tour operations by
offering specific tour examples...................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Tour operation management is an very effective and important aspect of the tourism
industries. Along with this, tour operations are the theory of businesses which shows that how to
deal with tourism practices, accommodating and the operating tours of business. In the present
scenario, tour operation management is very much helpful and effective tool by which customers
can get their desirable holidays package in a peaceful manner. According to this, tourism can be
international and domestic from different countries, so that travel and tourism industry always
offer various kind of services accordingly. This respective report is based on TUI(Thomson
Holidays) which is formed in the year of 1965 by Roy Thomson in UK. Along with this it is
headquartered in Luton England and deals with several kind of products such as package
holidays, scheduled passengers airlines and hotels or resorts. In the product development
department of this respective company being an assistant product manager, it is duty to enhance
their profits and growth of an organization for grab potential customers. Further discussion will
be made on functions, structure and types of the tour operating sector with analysation of
various stages for developing good holiday packages. At last, tour programmes in order to meet
targeted markets as well as explanation of tactical and strategic decision made by the operators
will get covered effectively.
TASK 1
P1 Various functions and roles of a large number of tour operators.
Tour operator can be an effective firm, organization and company as well who always
purchase different kind of travel components from suppliers and aid them in to the package tour
(Allahyari, Salari and Vigo, 2015.). After this they soled them their own prices and tag to the
public or through the middlemen is known as tour operator. Along with this, tour operator is the
only one who is responsible for keeping the tour and handle overall operation within the travel
and tourism industry. In reference with the TUI, assistant product manager has responsibility to
operate overall functions within the product development department in order to make effective
and attractive decision in a proper way. There are different kind of functions and roles which are
mainly followed by the TUI, mentioned below:
Functions of Tour Operator

Tour operator generally known as the services provider for tourist in order to visit, stay
and leave from the city. By this tour operators have their own higher volume of travel services in
which they offer different kind of facility to their customers like transportation facility, food
facility and so on. Therefore, there are different functions in reference with TUI, discussed
below:
Planning a Tour: This is very much essential and important function in which tour
operator always plan for a specific tour (B. DiPietro, Cao and Partlow, 2013.). As tour operator
plan a tour which mainly includes in different aspects like destination and justification of the
origin at last stopping point of tour's. Therefore, TUI always focuses on these kind of steps in
order to enhance their growh and satisfying clients.
Making Tour Package: According to this tour operators generally purchase of buys
travel components of individual from their suppliers and aid them in to the package tour. For
giving lots of satisfaction to the customer's TUI make effective travel and tour plan with their
own title and price tag properly.
Reservation: As per this function, tour operator is responsible to make all reservation in
a perfect way through making linkages with the different sectors like transportation and
accommodation by considering people desire.
Promotion: In this function tour operator makes several tour packages in the different
markets like national or international (Bazargan, 2016.). Therefore, the operator of tour promote
their destination in order to influence and attract large number of customer's in a effective way.
Roles of Tour Operators
In the present context, tour operators are the main aspect of this respected company in
which they plays an effective role in order to increase company's growth for long duration of
time. There are some roles of tour operator in context with TUI, given below:
 Tour operator always offer effective advice to company about the several destination of
travel.
 Tour operator plays proper role by making various arrangements and activities for the
accommodation, transport and tours so that people can get influence in a positive way.
 He always used to give good advice about travel issues and problems in order to reduce
them and fulfil customer's demand like their financial crisis, exchange rates and so on.

Apart from this tour operator always focuses on dealing with payments and always
perform their administration task in a right manner.
 A tour operator always help an organization in order to make effective and alternative
arrangements for their customer's for giving them higher satisfaction and examine their
holidays in a good way.
Therefore, roles and functions are much important of tour operator who always gives
higher satisfaction to their customer's in an effective manner. In reference with TUI, they always
take care of their customer's by giving therm high quality of products such as best hotel and
resource services and charter passenger airlines effectively.
P2 Justification of structure and scale of the tour operating industry.
Tour operating industry are the combination and components of package holidays as well
as tour operator also formulate several kind of brochures in order to promote their product and
packages in an effective way (Bhatia, 2012.). For example: if tour operator will produce their
product like charter airline and transportation services from airport to hotel than prices will be
affordable so that customer's can get effective satisfaction. Therefore, tour operating industries
are very essential and effective across the world. In reference with TUI there are some scale or
structure of operating tour industry are given below:
Scale of Tour Operating industry
In the present context, international and domestic tourist arrivals reached all the time so
according this analysation data has been recorded of 900 million at current period of time. The
main thing is that as per this world trade organization helps company as well as tour operator in
order to consider their customer's first and than make effective holiday plan accordingly. Along
with this they are also responsible to provide health and safety tools so that people can feel safe
in an appropriate manner (Brown and Bessant, 2013.). On the basis of this TUI can easily
increase their future growth and sustainability in to the workplace. Therefore, tours are the very
essential part of every human so that herein, tour operator should always take care of their
customer's. It will give good impact to the economy in order to keep tourist record within the
balance of payment. With the help of this scenario UK economy can get higher level of
satisfaction and able to give very effective and good feedback. By this advantage tour operator or
industry as well is able to contribute to the overall balance of payment.

Structure of Tour Operating industry
The main structure of operating tourism industry refers to the few components of
different sectors like transport, accommodation, tourist attraction, travel agent, tour operators at
last tourism and development. All of these are the structure by which tour industries can make
their decision and able to implement on them for giving best services to its customers. Herein,
some of these are explain below:
Attractions: This kind of structure is natural which made by human in order to influence
other people. This is all because natural attractions always affect the customers and helps them to
choose any product accordingly (Brunner and Bard, 2013.). All these human made things
mainly prepared for attract the customer's at good level. It mainly includes in different kind of
themes, designs, shape, colour and size. In regards with TUI they always make effective product
to its customer's by offering them good services.
Tour operators: As per this firms and companies also who are working in tourism sector
they generally makes proper package of holidays through which customers can avail tour
services. It is a sort of contract which is negotiated with the transportation service and
accommodation providers. If customers purchasing these services in a bulk than it can be
minimise the cost and can be present as a brochure to the agents of travel. In reference with TUI,
they specially makes good holiday package and provide services to the UK customers as well as
domestic.
Tourism development: According to this structure, customers can get live updates
within the tourism industry in order to related anything. It is mainly based on the several kind of
guidelines which is necessary for customers (Burgin and Hardiman, 2015..). As per this tour
operating industry gives effective intensive and salary package to their employees so that they
can easily involved in the various strategies and techniques by which they can make tour
industries effective. In regards with TUI, they has changed their industry by adopting new
innovative things so that they can easily influence people in a positive manner.
Transport: On the basis of this structure, tour operating industries mainly offers
transportation system for their customers, so that they do not required to take their own vehicle
because these sort of industries gives lots of facility to its customers like cab facility from hotel

to airport and so on. In context with TUI, they always gives transporting facility to its customers
so that they can live easily and happily.
TASK 2
P3 Several components and stages in order to create effective holiday package of various tour
operator needs.
In the current period of scenario, there are different kinds of components and stages for
making the proper package of holidays which can helps to TUI and able to meet tour operators
requirements within the marketplace. In context with TUI they uses the aspect of strategic
approach in order to considered to direct channels of distribution. With the help of this company
can enhance their distribution channels of services in order to make them effective in front of
others. Along with this for making better holiday package they are required to focuses on the few
aspects like make relationship with their product suppliers by which they can easily distribute
their product in an effective manner (De Sausmarez, 2013.). Apart from this, tour operating
services are able to make good connection with others and able to produce different type of
online channels for selling their services to its customers. On the behalf of this there are 2 types
of distribution services or channels, those are listed below:
Direct channels: These are includes in the direct selling of the product without any
issues. Along with this, it is more flexible in the nature just because it involves in the direct
communication with customers in a appropriate way. In this system TUI can easily receive
correct feedback from their customers and able to promote its product.
Indirect channels: These channels are those channels that never allows the direct contact
and communication with another one just because it involves in the mediators and generally
support the sales. As it is expansive method so that TUI does not follow this and concentrate on
direct channels in order to make effective holiday package in a systematic way.
Therefore, this can be said that one of the main channel that is direct channel is much
important for making effective holiday package in order to manage tour industries in a perfect
manner. As per this TUI helps to its consumer's by giving them proper holiday package and
make for them effective and attractive strategies in order to increase their business at good level
within the marketplace (Evans, Stonehouse and Campbell, 2012.). On the other side, due to the
competition this respective company has faced lots of challenges but now this is the only one

firm who is having good infrastructure and rapidly growing their business in the UK with several
kind of holiday packages. With the help of this respective organization is able to take so many
opportunities by which they can enhance their sales, revenue at higher level. As per the above
discussion all of the stages are much effective and essential to manage tours operating companies
by which customers can get good satisfaction. Along with this they also gives good feedback to
the tours operating industry in an appropriate manner.
On the other side, holiday package, package vacation as well as accommodation and
transportation which is sold by the tour operator. Therefore, this concept helps a lot to maximise
future growth and sales od TUI in the tours operating sector.
P4 Elaborate changes in the consumer need and demand by using various sources of research.
According to the changing environment in the consumer's requirements and demand,
there are several kind of research sources by which they can get affected within the negative or
positive way (Flores-Garza and et.al ., 2017.). Along with this, in the rural areas and growing
countries tourism sector brings lots of changes so that people faces few issues and challenges,
those are listed below:
Environmental effects: These effects can be harmful for the human activities so that
here, people are needed to protect their natural environment in a effective way. In reference to
the TUI, tours operator faces few challenges and also take some benefits, which are given below:
Positive: Some times environment helps to promote the product of tour operating
industries with lots of efficiency. As well as it also helps them to gain proper sales in a good
way.
Negative: During the negative way environment can be harm by cultural aspects like
water supply, coral reefs and cultural heritage (Heizer, Render and Munson, 2017). Along with
this by tours operating sector environment can get affected from pollution, traffic emissions and
so on.
Economic effects: Economic impacts on the economy in a particular area. Generally it
evaluate the several changes in the business profits, sales and revenue as well. In regards with
TIU, they can face negative and positive aspect within the working place, given below:
Positive: According to the positiveness in the nature tourism sector is able to give
effective service to their services within the TUI. When customers spend their lots of time within

the tour operating industries than it formulates the good impact on the economy in an effective
manner.
Negative: In the sector of tourism industry the local prices can be low any time just
because it depends on the people mood and their perception (Hoyos, Morales and Akhavan-
Tabatabaei, 2015.). Some times multinational companies like hotel and resorts they charged
higher pay from their customers so that influence its customers negatively. On the basis of this
TUI can get effected and not able to gain higher sales into the marketplace.
Social effects: It influence the overall activity of tourism sector in both negative and
positive way. In regards with TUI, they makes their unique strategies and techniques in order to
future opportunities in a proper way. There are some positive and negative factor, those are listed
below:
Positive:In the positive manner tour operating industries can develop effective tourism
pride for the customers and also helps them to interact with each other in the working place.
Negative: In this negative sense, people can get affected because of much crowd in the
marketing place along with this alcohol and drugs problems and increasing crime every day
(Lacej and Kalaj , 2015.). On the basis of people can get really affected in a negative way. By
this negative impact companies like hotels, tourism sector and so on can get highly affected in a
negative manner.
Due to these changes circumstances, this can be said that people have right to select their
own opinion, so that in the present world, there are lots of competition between so many firms so
that some times people are not able to take their own decision within the tourism sector. Along
with this consumer's demand and needs are much important for the tourism or each and every
sector within the market. So here, TUI required to adopt effective change in their industry for
fulfil consumer's demand and requirements in an appropriate manner.
TASK 3
P5 Justification of the higher range of package tour programmes in which they provide similar
product market.
Brochure is very much important for tour operator to reach at large no. of consumer base
which is a informative paper document that are folded in many folds in template, pamphlet or in
leaflet. It used by every kind of tour operators to reach at large no. of consumer base by

identifying their needs and wants in proper way. In context of TUI they operated both traditional
way and online mode so that they can approach each and every possible outcomes.
Traditional brochure:
Traditional brochure is an kind of informative document in which various images related
to the subject or content consisted and it looks beautiful and gives professional look. It is not just
only a brochure but a important attribute to reach at large no. of consumer base by identifying
their needs and wants in proper way (Naji-Azimi and et.al ., 2012). It is very much informative
by giving knowledge about every business and their potential benefits that associated with it.
Online Brochures:
Online brochure is one of important factor that are very much potential for an
organisation as well as individual to give their services and distinctive features regarding
products to draw attention of large no. of consumer base. There are some features that
differentiate it from traditional kind of brochure so that are very much relevant in today's world
to remain always competitive in marketplace. There are some facilities that are only received by
online brochure that it is easy to download and modify, relatively cheap in cost in comparison to
the traditional brochure with it gives high quality that proved beneficial for organisation to reach
at large no. of consumer base.
In that context organisation have to build distinctive product brochure but for luxury products
and services which are differ from the students. For luxury they have to give excellent services
that helps to differ from other kind of services but on other hand for students they have to
majorly focus on giving adventurous tour packages and information that helps to raise their level
of amusement and attractive pictures that helps to differ from other tour package providers so
that TUI can gain large market share by create distinctive image in the marketplace.
By taking both kind of brochures from the luxury holidays and high street travel shops to review
the distinctive feature that differ from one to another in better way. By observing that it has bene
evaluated that traditional brochure is relatively costly in comparison to the online brochure and
in luxury holiday brochure their prices are on high but they offer same services from the high
street travel shops (Heizer, Render and Munson, 2017). Luxury holidays brochure are more
attractive and more informative too to gain higher level of information and to connect large no.
of consumer base. On other hand in high street travel shops brochure that is less attractive and
their services are similar with the luxury brand.

TASK 4
P6 Various examples of tactical and strategic decision making in the tour operations by offering
specific tour examples.
The marketing manager of TUI have analysed tactical decision in formulating strategies
that are useful for enhancing growth of business at global market. The leaders have adopted
various approaches which include tactical response, tactical pricing, tactical marketing and
tactical planning in systematic manner for operating business activities. In decision making
process these approaches plays an important role in for effective growth of TUI. These
approaches are mentioned below:
Tactical Response: The tactical response is described as quick action which are taken in
specific situations that will have positive effect in market (Potgieter, de Jager and van Heerden,
2013). In context with TUI, manager should give emphasis on customer feedbacks for improving
sales margins when compared with competitor. Henceforth will result in improving customer
relationship.
Tactical pricing:
For an organisation after taking tactical responses organisation have to take tactical
pricing decisions in response to external and internal environment as per the competitors.
Changes in pricing is one of most important tactical decision after observing economy and its
downturns in proper way (Redjem and Marcon, 2016..). In context of TUI they consider each
and every factor in better way to get right kind of values and responses from them.
In strategic decisions includes some crucial decisions that helps an organisation to remain always
competitive in marketplace to take appropriate decisions:
Distribution channel:
For a tour operators majorly two kinds of distribution channels should be used that are
direct selling of products and services in which direct communication exist in various operators.
The another kind of tour operator is indirect channel in which lots of intermediaries exist to give
services to end users. In context of TUI they used both kind of direct and indirect channel of
distribution to give best services to the ultimate consumer base.
Product choice:
Product is which delivered to ultimate consumer, in context of tourism industry tour
packages are the product for the organisation as well as consumers that should be sold to

consumers to give best experience. In context of TUI they have wide range of destination
products and services for consumers that always delighted to get luxurious and adventurous tour
packages.
Image positioning and branding:
Image positioning or brand positioning that is very important factor that helps to
differentiate the products and services from other companies to get accurate results in an
organisation (Ronen, Pliskin and Pass, 2012.). In context of TUI which builds a distinctive
image in front of market to get reliable knowledge and information in proper way.
Surcharge policy:
Surcharge pricing is one of most important pricing strategy in which prices should be
marked high at time of seasons. It helps in raising their revenue to get higher no. of potential
candidates to get higher productivity in an organisation. In context of TUI they also policy of
surcharge that helps in enhance revenue ratio.
Cheap value:
This is also known as budget pricing by lowering down their pricing for enter into new
industry by enlarge business opportunities in positive way (Song, 2012.). In context of TUI they
by when expand into new market firstly fix pricing very low so that they can get market share
and then gradually increase it to get effective results in proper way.
So all are the important factors to take important strategical and tactical decisions to
reach at desirable outcomes in positive way. So for an organisation these decisions are very
much important to reap out important results to draw attention of large no. of consumer base.