Tour Operator Management: Industry Trends, Holiday Development Stages

This report provides an overview of the tour operator industry, focusing on the phases involved in creating holidays and brochures. It examines the impact of recent trends and developments on tour operators, including inbound, outbound, domestic, and specialist operators. The report discusses vertical and horizontal integration strategies, the roles of trade bodies like ABTA, CAA, FTO, and AITO, and emerging trends such as customization and responsible tourism. Furthermore, it details the stages involved in developing holiday packages, including scheduling, market research, cost estimation, negotiation, analysis, and workforce handling. The report also explores different contracting methods, such as ad-hoc contracts and agreements based on stay duration, highlighting their suitability for various holiday components and tour operator types. This document is available on Desklib, a platform offering study tools and solved assignments for students.

TOUR OPERATOR
MANAGEMENT

INTRODUCTION
The tourism industry contributes a lot to the GDP of the various nations and this industry is also
responsible for generating the revenue in the United Kingdom. The different types of the
packages are being provided to the consumers. This report helps in giving the overview of the
tour operator industry enlisting the different types of the phases considered in the creation of
the holidays as well as in the brochures. Along with this, the various, as well as the tactical
decisions, are made by these tour operators so that they can be compared in the various
situations when encountered.
1

2

TASK 1
1.1 EFFECT OF RECENT AND CURRENT TRENDS AND DEVELOPMENT ON TOUR
OPERATOR INDUSTRY
A tour operator is a person or the company
responsible for creating the holidays as well
as the vacations for the travellers with the
help of providing the reservations as well as
the facilities of the accommodation
provided to the customers by the tour
operators (Mariani, et al. 2014). The tour
operator is responsible for combining the
travelling as well as the various components
needed in it so that customer can enjoy and
have a memorable experience. This also
includes the airport facilities, the hotel
facilities, as well as the other services
provided by the tour operators (Kapiki,
2012). There are various categories of the
tour operators namely inbound, outbound,
Domestic, Ground, and the direct Sell
Operator.
Figure 1 Tour Operators
Source: Admin, 2010.
The direct sell operators are those
operators providing numerous offers to the
consumers by selling the package of the
holiday to the public. These are also called
the mediators as firstly they purchase the
holiday package from the organization itself
and then they sold off the holiday package
are done to the consumers. These
operators help in providing the low cost for
the packages (Frey and George, 2010). This
has been made available in the market. The
inbound tour operators are those operators
which provide tourism to the foreign
clients. The whole facilities are provided
from source to destination. The facilities of
accommodation, guides related to the
3

travel, food associated with the travelling,
the forms of entertainment are being
provided (Elkington, 2013). The
collaboration is also done with the tour
operators internationally so that the holiday
package can be built as well as sold. The
brand image of the country is created with
the help of making the available resources
to maximize and attain the profit. The
example of an inbound tour operator in the
UK is GTI Travel Group. The outbound tour
operators are those operators which
provide holiday package of the native
country. The travelling included in this
operator is combined with the facilities
provided by the inbound tour operators so
that high foreign exchange can be earned.
The example of popular outbound tour
operator of UK is First Choice as well as the
My Travel. The Domestic Tour operators
help in operating within the area
domestically so that the travellers can see
the inside of the domestic country
(Maloletko, et al. 2014). The domestic
tourism is not popular since the travellers
would like to visit the international tours
which in turn generate the high returns as
well as the margins. The integrity is
maintained at the domestic level. The
example of domestic tour operator of UK is
Leisure Breaks. The specialist tour operators
are those operators who choose certain
type in designing the package. The
numerous varieties were included in such
packages (Duman and Tosun, 2010).
Another name of the specialist tour
operators is the tailor-made operators as
the preference is given by the tourists. Their
preference consists of the food as well as
the transport facilities, and the location
preferred by them. These operators possess
the high knowledge of the information of
the various destinations of the tourists
(Wearing, et al. 2010). The package is
designed according to the budget given by
the tourists.
The tour operators in the United Kingdom
give their attention generally to the tours
organized internationally so that high
profits, as well as the margins, can be
attained. The country popularity is also
spreading thereby providing the foreign
exchange associated with it. The TUI AG is
the tour operator Of the UK that helps in
providing the international tours thereby
generating the revenue of 23.8 billion Euros
and is currently operating in the 15
countries of Europe. The 81 tour operators
4

are included in it (Mitchell, 2010). The
Thomas Cook AG is the popular tour
operator of UK which operates in the areas
of Germany, Hungary, Egypt, Ireland,
Austria, Poland, etc. the 30 tour operators
are included in this group. The revenue
generated by the Thomas Cook is about 8
billion euros and is originally operated in
Germany. The First Choice tour operators of
UK consists of about 28 tour operators and
the area of operation includes France,
Belgium, Switzerland, Canada, Italy, etc. the
39 tour operators are included in the My
Travel PLC thereby generating the revenue
of 8.2 billion Euros.
Vertical Integration helps in collaborating
with the various associates in the business
performed at the various levels (Burns, et
al. 2014). When the investment is done by
the tour operators in the companies of
transport as well as the hotels then this is
termed to as the backward vertical
integration and if the investment is done by
the tour operators in the various agencies
of the travelling then it is termed to as the
forward vertical integration. The focus of
the TUI Group is generally on the Vertical
Integration.
Figure 2 Vertical Integration
Source: Admin, 2013.
Horizontal Integration helps in doing the
merging process of the various agencies of
travelling so that the competition can be
reduced to some extent. In the year of
1995, the Thomas cook tour operator has
joined hands with the Sunworld so that the
standards of the company can be increased
(Joskow, 2012). This helps in generating the
higher market share thereby gaining the
competitive advantage.
5

Figure 3 Horizontal Integration
Source: Holden, 2010.
The roles possessed by the various bodies
associated with the trade are described
below:
ABTA helps in giving the expertise as well as
the advice needed by the tour operators in
designing the holidays in an effective way.
The issues encountered in this process of
designing are also solved so that the
businesses operations do not create the
impact. It is considered as one of the largest
association of the travel of the United
Kingdom.
UK CAA which is abbreviated as UK Civil
Aviation Authority helps in defining as well
as framing the policies which help in
regulating the industry of the aviation. It is
regarded as the public organization of the
United Kingdom.
FTO which is abbreviated as the Federation
of the tour operators with respect to the
organization so that the activities of the
tourism can be coordinated in the various
countries across the world. The merging of
the FTO with the ABTA is done in the year of
2008.
AITO which is abbreviated as the
association of the independent tour
operators helps in operating the 122 tour
operators in Britain. The assistance is being
provided by them to the independent as
well as those tour operators who design
special packages according to the budget of
the consumers.
The various trends in the holidays are
described below:
Customisation helps in bringing the
modifications needed in the various
packages of the tours as per the preference
is given by the tourists. The standard
packages were provided in the earlier time
with the help of government interference
as well as the service providers of the
6

tourism (Frey and George, 2010). With the
introduction of the specialised tour
packages, it becomes quite easier for the
customer to use and prefer according to
their budget.
Responsible tourism helps in eradicating the
negative impact created by the tourism so
that the benefits can be easily provided
with respect to the tourism. In addition to
this, the well- being is also improved
(Spenceley, 2012). The conservation of the
environment, the concept of sustainability,
as well as the awareness about the cultures,
is being given.
Figure 4 Responsible Tourism
Source: Administrator, 2014
7

TASK 2
INTRODUCTION
This report gives a brief about the description of the stages which are essential for developing
the holidays. The various components of the holidays along with the tour operators are defined
so that various methods can be built for contracting.
BODY
2.1 STAGES AND TIMESCALE INVOLVED IN DEVELOPING HOLIDAYS
The holidays can be developed with the help of the various stages along with an estimation of
the factor referred to as the timescale. The timescale is applied to the development stages of
the holiday packages. The holiday packages are developed so that the support of the customer
can be increased and also the behaviour of the customer can be estimated by understanding
their perception in order to achieve the customer satisfaction. These stages are explained
below:
Scheduling and Planning
This stage comprises of the requirements analysis so that the holiday packages can be
developed (Humphreys, ND). The planning is done first and then scheduling is done in order to
save the excess time consumed in the process.
Market Research
The market research helps in understanding the older and the newer trends occurring in the
market. The people security, as well as the protection, is considered as the prime importance
along with providing the additional services of the accommodation and the sightseeing places
(Surana and Anadon, 2015).
Cost Estimation
The estimation of the cost is done on the basis of the services as well as the facilities provided
to the consumers. These services focus on the quality and comprising the cost-effective services
8

(Westcott, et al. 2010). The holiday package is developed by keeping the view of the cost which
can be affordable for the people.
Negotiation
The tour operators apply negotiation process so that the cost associated with the high tour
packages can be reduced or lowered. This is carried out with the help of analysis done in the
market as the large market is possessed by the tour operators industry.
Analysis and Evaluation
With the help of analysis as well as the evaluation, the weaker areas can be analysed so that
they can be improved further (Burgess and Ivanič, 2010). The evaluation is done with the help
of taking the reviews as well as the feedback from the tourists as well as from the people.
Workforce Handling
The workforce of the organization must be such that the employees must possess the qualities
as well as the potentials so that they can deal with the customers easily thereby providing them
with the everlasting experiences. They should also have the knowledge about the market as
well as the needs of the customer.
TIMESCALE FIRST
MONTH
SECOND
MONTH
THIRD
MONTH
FOURTH
MONTH
FIFTH
MONTH
SIXTH
MONTH
Scheduling
and
Planning
Market
Research
Cost
Estimation
Negotiation
Analysis
9

and
Evaluation
Workforce
Handling
2.2 SUITABILITY OF DIFFERENT METHODS OF CONTRACTING FOR DIFFERENT
COMPONENTS OF HOLIDAY AND DIFFERENT TYPES OF TOUR OPERATORS
The contract process consists of the two participants involved in the process on the legal basis.
The legal services and the legal products are given to the tourists on the basis of this agreement
(Ashworth and Goodall, 2012). This agreement further includes the various sites of destination
within the country along with the facilities as well as the privileges offered by the tour
operators so that the tourist’s tour can be made easier.
The different contracts on which the tour operators rely are described below:
Ad-Hoc Contract
The developments of the holiday are initiated by using the ad-hoc networks by making use of
the available resources. These contracts are based on the stay duration of the tourists as the
different tourists possess or want the different duration of their staying with respect to
someplace. Such packages come at the different prices according to the services offered by the
packages (Horner and Swarbrooke, 2016). Also, the tourists choose the holiday packages
according to their budget. The company of Trailfinders gives the assistance to the tourists with
the help of emails.
Fixed Contract
The fixed contract is of the fixed period and our operators give this contract in order to increase
the productivity. These contracts are designed after analysing the demands raised by the
tourists so that their holiday package can be designed accordingly. In addition to this, the
booking facilities are provided thereby determining the overall cost of the holiday package.
10

Sales Contract
This contract is based on the providing the high rates of the holiday packages so that maximum
profit can be attained. The high class and the luxurious facilities are provided by such contracts.
It also involves the prime focus concerning about the security as well as protection of the
tourists (Pearce, 2013).
The versatile contract is being decided by the tour operators for their tourists as per the needs
of the tourists. The various varieties of the packages are designed so that the tourists can select
of them.
DIFFERENT TYPES OF TOUR OPERATORS
Ground Operator
The ground operator is the handling agencies which undertake the particular region as well as
the area so that supervision can be done. This supervision is done with respect to the accounts
which need to be handled in order to successfully implement the services (Dodds and Kuehnel,
2010). The facilities of accommodation, as well as the travelling, are being provided by the tour
operators.
Domestic Tour Operators
The services offered by the tour operators are native to the country that is at the domestic
level. This helps in giving the diversification which is needed by the services for the domestic
people. Agents are associated with the tour operators which help in giving the promotion to the
services. Further, it helps in building the national integration.
Inbound Operators
The international tourists are being handled with the help of the inbound operators. The
insurance services, the entertainment services, as well as the sightseeing of the popular
destination sites are being provided to them. The country image is restored with the help of this
thereby increasing the country economy (Prideaux and Coghlan, 2010).
11