Report on Travel and Tourism Sector: Historical Analysis and Impacts

This report provides a comprehensive overview of the travel and tourism sector, commencing with its historical development, tracing back to ancient times and detailing key periods such as before 1945, 1945-1979, and 1980 to the present day. It explores the structure of the industry, including the Leiper's Model and its components: departing travelers, traveler generating regions, transit route regions, tourist destination regions, and returning travelers, along with the six sectors of the industry, including attractions, transport, accommodation, tour operators, travel agents, and tourism development. The report further analyzes the functions of governments, government-sponsored bodies, and international agencies within the sector and assesses the implications of political change on the travel and tourism sector, using examples from various countries. It also examines factors affecting tourism demand and supply, including how supply has changed at TUI Group to meet demand, and evaluates the positive and negative economic, environmental, and social impacts of tourism, particularly concerning TUI Group businesses, along with strategies to mitigate negative impacts and maximize positive ones.

Travel and Tourism
Sector

Table of Contents
.....................................................................................................................................................1
Task 1...........................................................................................................................................................3
1.1 Key historical development in travel and tourism sector supported by travel and tourism chart of
major development:...............................................................................................................................3
Introduction:................................................................................................................................................3
Task 2...........................................................................................................................................................5
2.1 & 2.2.................................................................................................................................................5
2.3 Implication of political change in travel and tourism sector in different countries:.........................5
LO 3. Understand the effects of supply and demand on the travel and tourism sector..............................7
TASK 3..........................................................................................................................................................7
3.1- Explain factors affecting tourism demand.......................................................................................7
3.2- Explain how supply has changed at TUI Group to meet the effects of demand..............................8
LO 4. Understand the impacts of tourism....................................................................................................9
TASK 4..........................................................................................................................................................9
4.1 Evaluate the main positive and negative economic, environmental, and social impacts of tourism
regarding TUI Group businesses.............................................................................................................9
4.2 Explain strategies that can be used to minimize the negative impacts while maximizing the
positive impacts TUI Group businesses................................................................................................11

Task 1
1.1 Key historical development in travel and tourism sector supported by travel and
tourism chart of major development:
Introduction:
Tourism is one of the most creative and exciting industry because it provide thrill and goodness
for all kind of people working in the industry. Examples can be considered as the people or the
country in which people would like to travel gain some financial benefits due to the investment
of people from different parts of the world and it also provide fun and good time for the people
who are going on the tour. According to the details gained from the World travel and tourism
council is the area in which 10% of the global turnover is created. It is the industry in which
many of the people get jobs worldwide. There is a wording (Towner, 1995) that the “beginning
of the tourism is from wealth of the nation in which the lands are prestigious and privileged by
the people who visits to the seaside resorts and spas, activities of the business people and the
grand tours designed with the help of tourism agencies.”
History of Tourism:
The tourism industry is approximately 2000 years old. It began with the rich roman citizens
when they decided to spend their summers away from the city and started taking trips to the

country side and the coast. Further, tourism rose from the growing interest of people in
pilgrimage. Leisure tourism took hold to trading with the growing industrialization in Europe. In
1960s, with the growing disposable income of people attracting them to travel aroud different
parts of the country. Recreational and educational travel already existed in classical Rome.
Discussing about the history of the travel and tourism industry, there are three different time
bands under which the history is divided: -
Before 1945
1945 to 1979
1980 to current day
The discussion of different periods is given below: -Before 1945: - Many of the people and
community used to travel from one place to another in the ancient times in the search better
livelihood. revolution of industries in different countries then richer classes of the community
use to travel alone for the enjoyment of leisure and travel while their workers work in their
companies. During the period, the tourism industry was quite inconsistent because the operation
of hotels, transport operators travel agents, tour operators and all other works which are part the
travel industry were differently handled. During that time hotels were the mainly in the business
which wells beds for nights for the tourists, airlines and railways were there which sells seats to
travel from one place to another. On the other hand, travels use to sell travel and holidays,
however they tended to work very independently from each other. During the period of world
wars, much of the international level travelling was for the wealthy, privileged and elite groups
of the society.
1945 to 1979:- After the period of 1945, there was a main development in the travel and tourism
industry. In different part of the world, to increase the GDP growth of the country and making it
strong financially contributed in building different attractive places and they made efforts to
bring their own countries known places to the people living in other parts of the world. Mainly in
UK, the tour operators started changing the character of the industry with the help of different
integrated activities. If we consider the example of hotels which include the range of services
other than the accommodation they use to provide to the visitors. From 1950, combination of
factors gave rise to the increase of tourism, such as, availabilty of free time, increase in paid
holidays, improvement in tour packages, growth in air transport.
1980 to Present:- By 1980s, several airlines started offering travel services to most of the tourist
destinations. Tour operating companies were opened in order to help the tourists in planning
holidays, medical services, booking hotels, hiring cars etc. Air travel improved rapidly. Also,
non scheduled traffic that is charter services took a boom as well. At present, tourism has come a
long way. It plays an important role in global development as it has become biggest popular

industry in the world now a days. In most of the countries, investor make huge investment in the
tourism industry because of its potential of boosting economic growth. It seems to be a good
opportunity to protect and maintain the culture and heritage of a country.
The Structure of Travel & Tourism Industry
According to Leiper's Model, there are 5 key elements of a tourism system:
 Departing travellers
 Traveller generating regions
 transit route region
 Tourist destination region
 Returning traveller
The arrival of the tourist in the host country requires visa and traportation facility from their own
country. The tourists should be aware of the places that he/ she going to visit in that country. Trip
operators and various tourists website develop itinerary for this purpose. A tourist require road
map and other transportation facilities in order to roam around the places easily. The offers and
facilities should be provided to the tourists in order to maintain goodwill of the destinantion.
The structure of travel and tourism industry consists of six components of sectors:
 Attractions: Attraction can be natural or man made. Naural attractions are already
present and man made attractions are made in order to attract the tourists to the
destinantion. Alton tower is a famous theme based park is made for tourists attractins.
However, Blackpool Beach is a natural tourist attraction.
 Transport: Connectivity plays an important role for tourists. A place well connected
through rail network, air network and other public transport required to visit the city,
gets the tourist attraction.
 Accomodation: Well maintained hotels, Bed and Breakfast according to the tourists, is
required to be there. Travel inns, campsites, caravans and self catering villas are
contributing to the industry these days.
 Tour operators: Tour operators produce an appropriate holiday package according to the
time and holidays of the tourist. These days, holidays brochures already prepared by the
operators are launched by the tour operating companies during summer and winter
vacations. Providing guides for the tourits is other major concern of tour operators.
 Travel agent: Usually caters to the special holiday packages. Contracting to the party and
providing suitable package to them with all the amanities is the motive of a travel agent.
 Tourism and development: Tourists board offer information concerning the region
involved to the prospective visitor. The client can approach to tourist information centre

to obtain literature about the destinations available and anything else concerning the
area.
Diagram: A timeline chart of major development
Task 2
2.1 Analysing funcions of government, government sponsored bodies and international agencies
in travel and tourism

2.2 Implication of political change on travel and tourism sector

2.3 Implication of political change in travel and tourism sector in different countries:
Political change or political relations between countries plays significant role in indentifying the
image of destinations in tourist-generating regions. Political change also influence the travel and
tourism policy of government is respective country which lead the tourism sector in positive or
sometime in a negative way. The media like travel magazines, newspapers, social media has
important role in creating substantial influence on images of destinations. Political change has
the power to increase or decrease country’s attractiveness for tourism and it depends on what the
change is. If particular country facing safety concern before the change and if the change comes
along with increased stability then the country has the opportunity to recover natural tourism
state (Apostolopoulos and Ioannides, 1999). Conversely, due to political change if country
perceived unstable environment then it affect tourism sector, such as currently happening in
Egypt, tourism will plummet. There are similar examples facing where tourism sector facing
hurdles due to political change or instability. Another example is Thailand, due to the recent
protests in the country; it has reportedly lost a great deal of tourist money. Most often, because of
airport take over.
If country is facing issue of political stability then it can face public reluctance to travel to the
particular country. India is one of those countries which travel and tourism sector is experiencing

tremendous increase in tourist due to current political change in 2014. The increasing tours of
Prime Minister Narendra Modi to different countries, increasing popularity of the great leader
and also he is highlighting about the Indian culture, nature and places in his speeches, all things
spreading curiosity about India and most people around the world are willing to visit India.
China and United Kingdom are jointly experiencing boost in their tourism sector due to favoring
government policies. United Kingdom is inviting more foreign tourist through visa policies and
their policies are more favoring for Chinese tourist. The percentage of Chinese visiting to the UK
in near years has increase by 70% in this decade (Goeldner and Ritchie, 2009). It is due to the
favoring policies of the UK government towards the Chinese tourist. In 2016, the UK
government announced 2 years validity period for new visas for tourist from China. The another
great opportunity coming for Chinese tourist from the UK is of announcement about new 10 year
multiple entry visit visa at no extra expense. The new government announced all these new
policies by considering the economic benefit it gained from increasing number of Chinese
visitors. The UK economy earns £500 million a year from Chinese visitors. The prospects for
tourism sector definetly have great influence of political change. Radical changes in a countries
politics and effect of it on country condition can cause fear in visitors about their safety and
hence, they may avoid visiting that country. Thailand has plenty of popular beach resorts and
people love to visit them but recent political unrest, the extended to the occupation of the airport
in country’s capital has lead negative image of country (Yuvejwattana, 2011). This political
unstableness also leads negative impacts on the tourism industry. Political change in the tourists'
home country can also have an impact on the tourism industry.
LO 3. Understand the effects of supply and demand on the travel and tourism
sector
TASK 3
3.1- Explain factors affecting tourism demand
Tourism has been the best source to find change in routine. Today when people are bugged with
work and their daily routine they find it best to go on a vacation. There is huge demand of tourism
and travel. There are many companies who are offering deals with comfortable pricing for places
domestic as well as international. Travel and tourism has become a part of one’s life. Now a day
many families opt for tourism minimum once in a year which might extend to 3 times as well. They
become a part of a tourism company and avail their offers to go on a vacation. It has become very
convenient to go on a vacation; the transportation has also become easier. The tourism companies
offer facilities which include the transportation, stay as well as visiting the tourist spots as well.
These are some of the factors which affect the tourism demands (Holloway, 2004). the major factor
which affects the tourism is the season. many places are preferable as well as non-preferable during
seasons. The 12 months of a year are divided with place which are favorable and non-favorable

during seasons. Example places like Bali, Thailand, Nepal, turkey, Bhutan, Maldives, Mauritius,
Malaysia, Dubai, Hong Kong are not favorable during the month of July. The behavioral trends are
also changing. The technology and its effect on transport, communication and information have
made it easy for people to go on vacation. There is also a huge change in the attitude of the
consumer. The realization of going on a vacation or on a holiday depends upon the economic
condition of the consumer. The economic conditions of consumers today are getting better. The
differentiations that the tour operators make between various destinations are not overloaded with too
many information. Instead the consumer can decide upon the destination with less involvement of
people (Holloway, 2009). The other
factors that has influenced the demand of
tourism is urge of meeting friends and
relatives that day away from a family.
Also, the hotels have reduced the price of
their rooms, the airlines have reduced the
cost of ticketing etc. the Visa formalities
have also become easier. The factors
such as accessibility, accommodation,
amenities, ancillary services have also
improved. Historic and cultural factors
have also contributed to increase the demand of travel and tourism. People now a day want to be
more aware about the rich cultural heritage in various other countries and cities.
3.2- Explain how supply has changed at TUI Group to meet the effects of demand
TUI has changed to a wide extend. The destination list has increased and have reached to many
places that were not very easy to travel. TUI is now focusing on methods and procedures that help in
improving the environment and communities. They are in a verge if focusing on techniques that
reduces the negative impact on the environment. The TUI group have also realized that they want to
make their holidays beneficial to the local people and help to protect their environment (Hill and
Jones, 2010). They now ensure that they maintain the quality, visibility, and desirability of their
products and services for
their customers. They are working closely with local community bodies, national communities,
government, non-government, and trade associations to make the destinations have a sustainable
management. They are focusing on the destinations where they send their customers in huge
numbers and show them the difference they have made today. They have collaborated with the
PricewaterhouseCoopers(PwC) and are using their methodology to make the destinations different
than before. TUI have also increased their services with insurance services, VISA services and Forex
services. TUI’s vision is to make the travel experience special with a firm commitment to
sustainability. Their main moto is to maintain the standard and level of their product and services
what they have committed to their customers. TUI commits the best class experience in any

destination you choose to visit. They have their flights,
hotels, cars and guides who are available with the
customers whenever they need them. they make the
customers feel that they are having the best experience.
They ensure that their customers are comfortable even in
a foreign city or country which they choose to visit. Till
now they have given a 5.8 million of greener and fairer
holidays to the customers. They are also focusing on
reducing the carbon emissions in the environment. They
ensure that they reduce carbon emissions here, there or on the air. By using the word “Here”, they
mean their premises, their retail outlets, their broachers etc. and they have seen a significant changes
and savings in these areas. By the word “There” they mean the destinations, the hoteling, and have
found there they can even save the water wastage. “In the air” means they are reducing the carbon
emission in their airlines and have become the leading airlines in Europe for reducing carbon
emissions in the air (Kotler, Bowen and Maken, 2009). Today they are emitting 1 million tons of
carbon less as compared to the emission ration 3 years ago,.
LO 4. Understand the impacts of tourism
TASK 4
4.1 Evaluate the main positive and negative
economic, environmental, and social impacts of tourism regarding TUI Group
businesses
Thailand
Tourism has become the pillar industry in Thailand. Tourism brings huge foreign exchange to Thailand
which is used for the development of other industries in Thailand. People in Thailand are strongly
confident about the tourism industry. Thailand tourism industry have also impacted the country in several
ways. They have caused lots of damages to the property due to blasts. The antigovernment
demonstrations have also lead to Bangkok’s international airport to shut down for several weeks.
Thailand being a popular tourist spot has many economic, environmental, and social effects. These effects
have their own positive and negative aspects.
Economic
Positive
Tourism being the major industry on Thailand brings a huge amount of foreign exchange in the
country. The report shows that this exchange amount is higher than that of four other industries in
Thailand (Medlik, 2003). Hence, tourism has become the foundation of Thailand.

Negative
Other industries do not have much scope of growth. High-tech industries such as engineering,
physics, chemistry etc should be more focused on which will help growth of the country in future
(Middleton and Clarke, 2001).
Environmental
Positive
Tourism have help people realize how beautiful Thailand is. The beaches, the gardens, historic
monuments, and natural landscapes have a great demand in the world (Neumayer, 2004). They
have the most beautiful islands, mysterious temples, marvelous culture have attracted people from
all around the world.
Negative
Blasts have destroyed the property of Thailand contributing to environmental hazards. Thailand has also
suffered from the worst floods and has deeply impacted the manufacturing and agricultural industry in
Thailand.
Social
Positive
Tourism has solved lots of social problems in Thailand and has been proved to be good for the
social development. Tourism not only means sightseeing to historic places and natural landscapes
but tourists also need restaurants to eat, vehicles to travels, hotels to stay, stores to shop, which has
improved the living of common people in Thailand (O'Sullivan and Hall, 1996).
Negative
Thailand tourism have a negative effect on education. Tourism workers do not need education
which has minimized the education level in Thailand. Only 70% of students opt for further
education which has a long term negative impact on the country (Pitts, 1996).
Egypt
Economic
Positive
Tourism in Egypt contributes around 11.4% of its GDP. Egyptian government has reopened attractions
viz. the tomb of King Seti and Queen Nefertari.
Negative
The Economy of Egypt has slowed down. There are many businesses which are set up but they do not
have customers. There has been a price hike of many basic goods and services.

There has been a series of airline disasters which has decreased the economic power of Egypt and reduced
the tourist visits. It has shattered the tourism industry in Egypt. The customers in Egypt has dropped from
under 6% to 3%.
Environmental
Positive
Egypt has been declared the best place for temples and tombs. It has a vast tract of deserts and is
famous for Nile River (Poirier, 1997). It is the best place for combination of culture, adventure and
relaxation.
Negative
Since the customers in Egypt has reduced. The maintenance of the property is not kept up to the mark.
There is a huge difference in what Egypt was earlier and what it is now.
Social
Positive
Egyptian government has reopened many tourist’s spots which were closed earlier. This has given
a positive rise to the local people who lose their business when these sites were closed (Poirier,
2000).
Negative
There is a ban on direct flights from UK toSharm el-Sheikh which has reduced the number of visitors
because it has not been proved to be very convenient for the customers. Also, Egyptian government do
not care about the people whose job depend on guides.
4.2 Explain strategies that can be used to minimize the negative impacts while
maximizing the positive impacts TUI Group
businesses
The best strategy that TUI can use is the generic strategy that is
defined by porter. This strategy will help TUI to understand how
to place the positive and negative impacts of the business. Some
of the main strategies are defined as below:
Tourists have to prefer local hotels and restaurants so that we can
preserve our environment by avoiding the expensive buildings which
are responsible for damaging the global environment which can
effect our enivornment at lesser extent.
Foreign tourists should also be treated as local tourists so that both
tourism get equal benefits of resources.

1. Guiding the tourists by explaining about their effect on the tourist destination and telling how
they can help in putting all these things at lower rate.
2. Confirming that tourists are not doing any unofficial things which can make the place
unattractive.
Making strict rules for tourist which they can take from the area and confirming that there is no risks
associated with it.
The Scope on the Y axis will place the narrow and broad aspects and then focus on the cost
leadership and cost focus. By using the source of competitive advantage TUI can focus on which
aspects to focus and which aspect to eliminate. By using this strategy TUI will focus on those
aspects which they want to highlight in front of their customers and ignore the aspects which are not
necessary to be mentioned. Cost Leadership block will place those aspects which brings money to
the country and helps in improving the country’s economy (Thompson, 2005). Differentiation block
will place those aspects which helps in differentiating the country which have unique features from
other countries. Cost focus are the aspects which require cost for improvement. The aspects in this
block should be eliminated because it will hit the economy of the country.Differentiation focus are
the aspects which can be improved and moved to differentiating factors if the government of that
country focuses on these aspects.
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