Travel and Tourism Business Plan: Revenue, HR, and Legal Aspects
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Desklib provides past papers and solved assignments for students. This project analyzes revenue management, HR, and legal aspects of the travel and tourism industry.

THE TRAVEL AND TOURISM
BUSINESS
1
BUSINESS
1
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Table of Contents
Task 1...............................................................................................................................................4
P1. Discuss the rationale and principles of revenue management for the travel and tourism
industry.........................................................................................................................................4
P2. Investigate how a specific sector of the travel and tourism industry applies revenue
management tools to generate and maximize profit....................................................................5
M1. Analyse the impact of differentiated pricing strategies on revenue management in a
specific sector of the travel and tourism industry........................................................................6
D1. Critically analyse the principles of revenue management and its application in a specific
sector of the travel and tourism industry......................................................................................7
Task 2...............................................................................................................................................8
P3 Review the different stages of the HR life cycle applied to the Business Development
Manager and their importance for retaining and developing talent.............................................8
P4 Develop a performance management plan for a Business Development Manager applying
techniques to resolve both negative behaviour and overcome issues of staff retention.............10
M2 Evaluate the importance of the HR life cycle in relation to strategic talent management and
overcoming issues of staff retention..........................................................................................19
D2 Make valid judgments and recommendations on how HR processes and documents can be
improved for effective talent planning throughout the HR life cycle........................................20
Task 3.............................................................................................................................................21
P5 Explore specific legislation that organizations in the travel and tourism industry have to
adhere to.....................................................................................................................................21
2
Task 1...............................................................................................................................................4
P1. Discuss the rationale and principles of revenue management for the travel and tourism
industry.........................................................................................................................................4
P2. Investigate how a specific sector of the travel and tourism industry applies revenue
management tools to generate and maximize profit....................................................................5
M1. Analyse the impact of differentiated pricing strategies on revenue management in a
specific sector of the travel and tourism industry........................................................................6
D1. Critically analyse the principles of revenue management and its application in a specific
sector of the travel and tourism industry......................................................................................7
Task 2...............................................................................................................................................8
P3 Review the different stages of the HR life cycle applied to the Business Development
Manager and their importance for retaining and developing talent.............................................8
P4 Develop a performance management plan for a Business Development Manager applying
techniques to resolve both negative behaviour and overcome issues of staff retention.............10
M2 Evaluate the importance of the HR life cycle in relation to strategic talent management and
overcoming issues of staff retention..........................................................................................19
D2 Make valid judgments and recommendations on how HR processes and documents can be
improved for effective talent planning throughout the HR life cycle........................................20
Task 3.............................................................................................................................................21
P5 Explore specific legislation that organizations in the travel and tourism industry have to
adhere to.....................................................................................................................................21
2

P6 Using specific examples, illustrate how company, employment and contract law has a
potential impact on business decision-making in the travel and tourism industry....................23
M3 Using specific examples, examine the potential implications of regulations, legislation and
standards on decision-making in the travel and tourism industry..............................................24
D3 Critically reflect on the potential impacts of regulations, legislation and ethical principles
on decision-making in the travel and tourism industry..............................................................25
Task 4.............................................................................................................................................26
P7 Explore the different types of financial statements and reporting mechanisms for
organisations within the travel and tourism industry.................................................................26
P 8 Explain the importance and value of budgets for controlling business performance and
identifying variances..................................................................................................................28
M4 Interpret financial statements and reports for organisations within the travel and tourism
industry.......................................................................................................................................31
D4 Evaluate business performance based on financial statements reports for organisations
within the travel and tourism industry.......................................................................................32
References......................................................................................................................................33
3
potential impact on business decision-making in the travel and tourism industry....................23
M3 Using specific examples, examine the potential implications of regulations, legislation and
standards on decision-making in the travel and tourism industry..............................................24
D3 Critically reflect on the potential impacts of regulations, legislation and ethical principles
on decision-making in the travel and tourism industry..............................................................25
Task 4.............................................................................................................................................26
P7 Explore the different types of financial statements and reporting mechanisms for
organisations within the travel and tourism industry.................................................................26
P 8 Explain the importance and value of budgets for controlling business performance and
identifying variances..................................................................................................................28
M4 Interpret financial statements and reports for organisations within the travel and tourism
industry.......................................................................................................................................31
D4 Evaluate business performance based on financial statements reports for organisations
within the travel and tourism industry.......................................................................................32
References......................................................................................................................................33
3
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Task 1
P1. Discuss the rationale and principles of revenue management for the travel and tourism
industry.
Revenue management is the management of revenue generation from the potential customers of
the business (Denizci and Mohammed, 2015). It involves analysis of consumer behavior, market
behavior, trends and forecasting of future demand by the management in order to provide
optimized product availability and price to maximize the revenue of the organization.
Principles of revenue management;
Market analysis: To manage revenue in the travel and tourism industry first one
should identify the potential customers in the industry. Creating a customer base
is necessary.
Demand and supply forecasting: Aggregate demand should be forecast by the
analysis of previous year revenues and the trends in the market and also the
supply of the services should be estimated in order to fulfill demand from every
customer.
Pricing Strategy: Study of the market should be done to determine the price of the
services accordingly, which covers cost price and is in accordance with market
standard pricing.
Revenue controls: A proper control and management for all the receipts and
receivables to ensure sound financial management of the industry is necessary.
Performance measurement: Revenue should be matched with targets and analysis
is required to evaluate the extent of success of management strategies.
Highland Tours will have business transactions like hiring/ renting of vehicles, bookings of
hotels, booking of travel tickets. It is advised for revenue management including evaluation of
the performance to ensure future growth and sustainability. It can use cost/revenue analysis for
operating profits and maintain standard costing for performance evaluations.
4
P1. Discuss the rationale and principles of revenue management for the travel and tourism
industry.
Revenue management is the management of revenue generation from the potential customers of
the business (Denizci and Mohammed, 2015). It involves analysis of consumer behavior, market
behavior, trends and forecasting of future demand by the management in order to provide
optimized product availability and price to maximize the revenue of the organization.
Principles of revenue management;
Market analysis: To manage revenue in the travel and tourism industry first one
should identify the potential customers in the industry. Creating a customer base
is necessary.
Demand and supply forecasting: Aggregate demand should be forecast by the
analysis of previous year revenues and the trends in the market and also the
supply of the services should be estimated in order to fulfill demand from every
customer.
Pricing Strategy: Study of the market should be done to determine the price of the
services accordingly, which covers cost price and is in accordance with market
standard pricing.
Revenue controls: A proper control and management for all the receipts and
receivables to ensure sound financial management of the industry is necessary.
Performance measurement: Revenue should be matched with targets and analysis
is required to evaluate the extent of success of management strategies.
Highland Tours will have business transactions like hiring/ renting of vehicles, bookings of
hotels, booking of travel tickets. It is advised for revenue management including evaluation of
the performance to ensure future growth and sustainability. It can use cost/revenue analysis for
operating profits and maintain standard costing for performance evaluations.
4
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P2. Investigate how a specific sector of the travel and tourism industry applies revenue
management tools to generate and maximize profit.
Highland Tours is a travel and tourism industry, it should apply revenue management tools to
generate maximum profits from its business (Swanson and Edgell, 2013). It can use the
following steps for revenue management;
Highland Tours should analysis the number of customers in the industry and market their
business to get recognized by the customers which will cause an increase in their
revenue.
It should make an estimate of the demand according to the seasonal demand in the
industry and vulnerability of factors affecting demand. Highland should analyze its
previous years’ revenue and the trends of that revenue generation and should give more
attention to the services which bring comparatively greater revenue and other services
should be accordingly promoted to bring in revenue.
An estimation of supply should be made on the basis of demand and the prices its
services should be charged according to the other competitive firms in the market. This is
to provide the availability of the required services to its customers on time
Also, it should evaluate its strategies and methods of revenue management to ensure that
the methods and strategies followed are proper and working efficiently and effectively.
All the operating profit, net profit, and cash flows should be taken into consideration. A
cost-benefit analysis will help to forecast the profit values for the firm. Apart from this
budgeting and standard costing techniques will help the management to understand the
performance well.
5
management tools to generate and maximize profit.
Highland Tours is a travel and tourism industry, it should apply revenue management tools to
generate maximum profits from its business (Swanson and Edgell, 2013). It can use the
following steps for revenue management;
Highland Tours should analysis the number of customers in the industry and market their
business to get recognized by the customers which will cause an increase in their
revenue.
It should make an estimate of the demand according to the seasonal demand in the
industry and vulnerability of factors affecting demand. Highland should analyze its
previous years’ revenue and the trends of that revenue generation and should give more
attention to the services which bring comparatively greater revenue and other services
should be accordingly promoted to bring in revenue.
An estimation of supply should be made on the basis of demand and the prices its
services should be charged according to the other competitive firms in the market. This is
to provide the availability of the required services to its customers on time
Also, it should evaluate its strategies and methods of revenue management to ensure that
the methods and strategies followed are proper and working efficiently and effectively.
All the operating profit, net profit, and cash flows should be taken into consideration. A
cost-benefit analysis will help to forecast the profit values for the firm. Apart from this
budgeting and standard costing techniques will help the management to understand the
performance well.
5

M1. Analyse the impact of differentiated pricing strategies on revenue management in a
specific sector of the travel and tourism industry.
Pricing strategies mean the method or technique used to price the product or services of an
organization (Sahut and Hikkerova, 2014). There are various types of pricing strategies which
have their own characteristics. Some of these strategies are discussed below with their impact on
Highland tours services:
Cost-based pricing: In this pricing strategy price of the services is determined according
to the involved cost in proving that service. It is obtained by adding the desired/required
profit percentage to the cost of the service. The services charged to the customer on this
basis will provide a fixed profit percentage to the firm. But the demerit is that the
customers who may have provided revenue for a little lower price are lost in case it is not
negotiable price and in case it is negotiable maximum price discrimination is seen in this
method.
Value-based pricing: It is customer perception based pricing strategy. In this, the price of
the service is firstly assessed from the customers need and value perception and then a
target price is set to deliver customer the required services in the perceived value by
adjusting the cost of the services. This strategy will bring in a number of customers to the
Highland tours services but this strategy has comparatively lower of the profits on per
person basis. However greater profits can be achieved by increasing numbers of the
customer in the business. In the competitive market, this strategy will help to attract
customers.
Market-based pricing: Prices in this strategy are determined on the basis of market
conditions. It includes trends, general market price levels, prices of the rivalry firms,
demand for the services in the market, and price sensitivity.
6
specific sector of the travel and tourism industry.
Pricing strategies mean the method or technique used to price the product or services of an
organization (Sahut and Hikkerova, 2014). There are various types of pricing strategies which
have their own characteristics. Some of these strategies are discussed below with their impact on
Highland tours services:
Cost-based pricing: In this pricing strategy price of the services is determined according
to the involved cost in proving that service. It is obtained by adding the desired/required
profit percentage to the cost of the service. The services charged to the customer on this
basis will provide a fixed profit percentage to the firm. But the demerit is that the
customers who may have provided revenue for a little lower price are lost in case it is not
negotiable price and in case it is negotiable maximum price discrimination is seen in this
method.
Value-based pricing: It is customer perception based pricing strategy. In this, the price of
the service is firstly assessed from the customers need and value perception and then a
target price is set to deliver customer the required services in the perceived value by
adjusting the cost of the services. This strategy will bring in a number of customers to the
Highland tours services but this strategy has comparatively lower of the profits on per
person basis. However greater profits can be achieved by increasing numbers of the
customer in the business. In the competitive market, this strategy will help to attract
customers.
Market-based pricing: Prices in this strategy are determined on the basis of market
conditions. It includes trends, general market price levels, prices of the rivalry firms,
demand for the services in the market, and price sensitivity.
6
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D1. Critically analyse the principles of revenue management and its application in a
specific sector of the travel and tourism industry.
Highland Tours works in the travel and tourism sector. It is a service based company which
provides all travel related services like rooms/ buses/ flight bookings. It should use the model of
revenue management in order to increase its profits (Azzopardi and Nash, 2013). In revenue
management, it is advised to follow the principles of revenue management which include
forecasting of demand and accordingly maintaining a supply of the same. When an organization
in the service industry is dealt with the operating costing play an important role. It helps in
calculating per services charges by allocating the costs related to the services. Some of these are
explained in accordance with highland tour services.
Revenue per available room (REVPAR): Revenue per available room is the price charged
by the Highland Tours from its customer for a single room per day. The prices of the
room may vary depending on the size and facilities provided by the hotel.
Occupancy: Occupancy is the term that is used to define the occupied rooms of the hotel
in comparison to the total rooms that are available in the hotel for stays by the customer.
Occupancy is generally shown in terms of percentage.
Revenue per passenger kilometer (RPK): Revenue per passenger kilometer is the amount
charged by the vehicle service provider from its passenger for traveling every kilometer.
Revenue per kilometer is calculated by dividing total revenue from the vehicle from the
total kilometers traveled. And the revenue per passenger kilometer is calculated by
dividing Revenue per kilometer with the number of passengers in the vehicle.
Load factor: Load factor is defined as a comparison between the actual amount of some
quantity and maximum possible or allowed quantity. In case of a passenger transportation
service, it compares the seats occupied by the passengers with the total number of seats
available to be occupied by the passengers.
7
specific sector of the travel and tourism industry.
Highland Tours works in the travel and tourism sector. It is a service based company which
provides all travel related services like rooms/ buses/ flight bookings. It should use the model of
revenue management in order to increase its profits (Azzopardi and Nash, 2013). In revenue
management, it is advised to follow the principles of revenue management which include
forecasting of demand and accordingly maintaining a supply of the same. When an organization
in the service industry is dealt with the operating costing play an important role. It helps in
calculating per services charges by allocating the costs related to the services. Some of these are
explained in accordance with highland tour services.
Revenue per available room (REVPAR): Revenue per available room is the price charged
by the Highland Tours from its customer for a single room per day. The prices of the
room may vary depending on the size and facilities provided by the hotel.
Occupancy: Occupancy is the term that is used to define the occupied rooms of the hotel
in comparison to the total rooms that are available in the hotel for stays by the customer.
Occupancy is generally shown in terms of percentage.
Revenue per passenger kilometer (RPK): Revenue per passenger kilometer is the amount
charged by the vehicle service provider from its passenger for traveling every kilometer.
Revenue per kilometer is calculated by dividing total revenue from the vehicle from the
total kilometers traveled. And the revenue per passenger kilometer is calculated by
dividing Revenue per kilometer with the number of passengers in the vehicle.
Load factor: Load factor is defined as a comparison between the actual amount of some
quantity and maximum possible or allowed quantity. In case of a passenger transportation
service, it compares the seats occupied by the passengers with the total number of seats
available to be occupied by the passengers.
7
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Task 2
P3 Review the different stages of the HR life cycle applied to the Business Development
Manager and their importance for retaining and developing talent.
There are five different stages of the HR life cycle in the organization Highland tours which are
as follows:
Hiring new candidates- The first phase of the HR life cycle is to appoint new candidates
for the association; this will help the association in recuperating the development and
production (Solnet, et. al., 2015). This move includes a complete strategy of recruiting
new candidates, finding out how many vacancies are available and hired talented
candidates by scheduling interviews, this will be valuable for the organization by
recruiting talented candidates
Train new employees- The second phase is educating new employees about the corporate
policies and the role of each individual in the association and their responsibilities
towards the organizations. The responsibility of HR is to communicate with new workers
and inform them about their duties and also introduce them to other members of the staff
Inspire them throughout their job- New workers may not be much encouraged towards
their profession as they are fresh to the association so the responsibility of HR will be
motivating those employees by appreciating their work, their efforts and pleasing them
for their performance so that they will remain encouraged towards their work
Examine and evaluate their performance- In this phase, HR have to examine the
performance of new workers so that they will conclude whether the new workers are
performing well or not and also they can accomplish different performance reviews so
that it will help the workers in achieving their aims.
Celebrating the success- In this step, HR can appreciate employee’s performance by
pleasing them for their efforts which will enhance the confidence and make them more
encourage towards their work
The importance of Highland tours HR for retaining and developing talent is that they can be able
to recruit talented employees and also by retaining employees they will save plenty of costs
8
P3 Review the different stages of the HR life cycle applied to the Business Development
Manager and their importance for retaining and developing talent.
There are five different stages of the HR life cycle in the organization Highland tours which are
as follows:
Hiring new candidates- The first phase of the HR life cycle is to appoint new candidates
for the association; this will help the association in recuperating the development and
production (Solnet, et. al., 2015). This move includes a complete strategy of recruiting
new candidates, finding out how many vacancies are available and hired talented
candidates by scheduling interviews, this will be valuable for the organization by
recruiting talented candidates
Train new employees- The second phase is educating new employees about the corporate
policies and the role of each individual in the association and their responsibilities
towards the organizations. The responsibility of HR is to communicate with new workers
and inform them about their duties and also introduce them to other members of the staff
Inspire them throughout their job- New workers may not be much encouraged towards
their profession as they are fresh to the association so the responsibility of HR will be
motivating those employees by appreciating their work, their efforts and pleasing them
for their performance so that they will remain encouraged towards their work
Examine and evaluate their performance- In this phase, HR have to examine the
performance of new workers so that they will conclude whether the new workers are
performing well or not and also they can accomplish different performance reviews so
that it will help the workers in achieving their aims.
Celebrating the success- In this step, HR can appreciate employee’s performance by
pleasing them for their efforts which will enhance the confidence and make them more
encourage towards their work
The importance of Highland tours HR for retaining and developing talent is that they can be able
to recruit talented employees and also by retaining employees they will save plenty of costs
8

which can be waste in training of new employees. By retention of previous employees, the
association can manage to save time and it will be beneficial for the employees as well as they
are known to their duties.
9
association can manage to save time and it will be beneficial for the employees as well as they
are known to their duties.
9
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P4 Develop a performance management plan for a Business Development Manager
applying techniques to resolve both negative behaviour and overcome issues of staff
retention.
Target
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
future
review
dates
Date to
achieve
expecte
d
standar
d
Motivatio
n
On 15-
Jan-2019,
they have
conducte
d a talent
developm
ent
In a talent
developme
nt program,
it is
expected
from the
employees
To meet the
standard of
performance
, they have
decided to
organize a
talent
They
agree to
support
employee
s by
giving
motivatio
20-
Jan-
2019
They
have
reviewe
d that,
there is
an
improve
They
have
examine
d that
after
three
months
10
applying techniques to resolve both negative behaviour and overcome issues of staff
retention.
Target
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
future
review
dates
Date to
achieve
expecte
d
standar
d
Motivatio
n
On 15-
Jan-2019,
they have
conducte
d a talent
developm
ent
In a talent
developme
nt program,
it is
expected
from the
employees
To meet the
standard of
performance
, they have
decided to
organize a
talent
They
agree to
support
employee
s by
giving
motivatio
20-
Jan-
2019
They
have
reviewe
d that,
there is
an
improve
They
have
examine
d that
after
three
months
10
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Target
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
future
review
dates
Date to
achieve
expecte
d
standar
d
program
in which
they have
found
that many
employee
s are not
that
motivated
towards
their
that they
will
showcase
their skills
and new
ideas for
the
betterment
of the
organizatio
n
development
program on
a monthly
basis.
n to them
through
different
program
mes
ment in
employe
e
because
of a
talent
develop
ment
program
and in
the
that is
on 15-
May-
2019,
the
employe
e will
able to
achieve
the
standard
11
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
future
review
dates
Date to
achieve
expecte
d
standar
d
program
in which
they have
found
that many
employee
s are not
that
motivated
towards
their
that they
will
showcase
their skills
and new
ideas for
the
betterment
of the
organizatio
n
development
program on
a monthly
basis.
n to them
through
different
program
mes
ment in
employe
e
because
of a
talent
develop
ment
program
and in
the
that is
on 15-
May-
2019,
the
employe
e will
able to
achieve
the
standard
11

Target
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
future
review
dates
Date to
achieve
expecte
d
standar
d
work future,
with the
help of
these
sessions
, they
will
able to
motivat
e entire
employe
of their
work.
12
area
Detail
specific
area
where
performa
nce
standard
s have
not been
met
Performa
nce
concern
Detail
specific
dates
and
exampl
es of
where
the
standar
ds have
not
been
met
Expected
standard of
performan
ce
Detail what
is expected
of the
employee in
terms of
their
performanc
e i.e. what
does ‘good’
look like
Agreed
improveme
nt actions
Detail what
actions need
to be taken
to meet the
expected
standard of
performance
Support
Detail
what has
been
agreed in
terms of
support
required
to achieve
the
expected
standard
of
performa
nce
Revi
ew
Date
Review
notes
Detail
improve
ment
made
and any
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Date to
achieve
expecte
d
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with the
help of
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motivat
e entire
employe
of their
work.
12
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