Travel and Tourism Business Toolkit: Thomas Cook and Business Strategy

This report provides a comprehensive overview of the travel and tourism business, focusing on key aspects such as revenue management, human resource management, and relevant legislation. It delves into the principles of revenue management, including market segmentation and forecasting, and examines the tools used to maximize profit within the industry, such as room sales mix projection and discount fixation. The report also explores the HR life cycle, including recruitment, job descriptions, and motivation strategies, and develops a performance management plan for a travel and tourism company. Furthermore, it discusses the legislation that companies must comply with, such as the Package Travel Regulations and the Consumer Protection Act, and analyzes the impact of employment and contract law on the business. The report uses Thomas Cook as a case study to illustrate these concepts, providing practical insights into how these elements contribute to the success of a travel and tourism business.

Travel and Tourism
Business Toolkit

INTRODUCTION
Travel and tourism sector has great contribution in the expansion of hospitality industry.
This business enterprise is a vast group company with one common goal i.e. to provide necessary
or desirable good and services to travellers (Abdul-Rahman and Nor, 2017). However, travel
and tourism is classified in several segments such as Lodging operation, transportation services,
hotels and restaurants etc. whose main objective is to satisfy the customer needs by providing
effective services. In this industry there are several department which like sales, finance,
marketing etc. who work towards the accomplishment of organisational goal in an effective and
efficient manner. However, each departments are interlinked with each other which enable the
company to attain high productivity and profitability. In context to Thomas Cook, one of the
famous travel and tourism company in the world which is commenced in the year of 1841. Its
headquartered in London, UK and it provides different segments of products like cruise lines,
hotels and restaurant, package holidays etc. This research covers key value of revenue
management in travel and tourism industry, ways to manage budget, statistical and financial
records. Finally, HR life cycle and Human Resource Strategy, Legislation and ethics in Travel
and tourism industry.
TASK 1
P1 Rationale and principle of revenue management for Travel and Tourism Industry
Travel and tourism is considered as complex industry which is made up of several
industries, but in that their main common goal is to provide impressive or effective product
/services to customers or travellers. Some of the components of this industry are travel agents,
transport, lodging and catering etc. which directly influence the business operation of company.
Along with this, this industry has direct impact on social and cultural, economic, environmental
factors which effect company's productivity and profitability (Anderson and et. al., 2018).
Moreover, it is highly crucial concept among hospitality industry, as it enable hotels possessor to
evaluate demand and optimize accessibility and pricing to accomplish the best achievable
financial outcome. Furthermore, within travel and tourism industry their main focus on
marketing right product to client, at the correct moment, for affordable price, through impressive
distribution channel, with the foremost cost ratio. As a concept of revenue management, it enable
the company to foresee consumer need to initiate change pricing. However, revenue

management plays a vital role in Thomas Cook as it provide the potentiality to make most out of
perishable product of products like hotels rooms, transportation etc. and allowing them to
increase amount of money in order to enhance business. Some of the key principles of revenue
management which Thomas applies for their expansion of business operation are as follows:
 Market Segmentation: This principle mainly concentrated on measure ability, action
ability, accessibility, substantiation. However, in tourism, market segmentation is very
essential (Bititci, Cocca and Ates, 2016). The strategy of market segmentation is to
alleviate cost effective marketing through preparation, publicity and transfer of planned
commodity which satisfy the wants of target groups. By this, Thomas Cook are enable to
split existing and possible industry on the ground of their characteristics and concentrate
marketing efforts like pricing, supply and promotion efforts to target markets.
 Forecasting: In tourism industry, demand forecasting plays a vital role as it enable them
to predict the most probable level of demand that is likely to occur in the light of
circumstances. By this, Thomas Cooks able to determine the supply needed by
customers and help them to take effective decisions in order to minimise the risk
regarding future.
However, the above mentioned principles are integral elements for Tomas Cook in order to
enhance their business operation and can attain high profitability.
P2 Revenue management tools to generate and maximise profit
Travel and tourism industry is on of the fastest growing among the market which not only
improving the business operation but at the same time it helps economy to expand and enhance
in an effective manner (Board and Skrzypacz, 2016). It encompasses of various sectors and each
of them has unique responsibilities and roles which contribute towards the attainment of business
objective. Revenue management tool is the application of data system and pricing scheme to
assign right capacity to potential customers at correct place at given time. However, revenue
management tool plays a vital role in Thomas Cook's different sectors i.e. accommodation, food
and beverages, transportation etc. As it enable them to determine pricing in order to anticipate
the future demand level so that satisfaction level get enhanced in an effective manner. Along
with this, revenue management is the process of analyse and factorization in user action to attain
maximal amount of profit from a perishable products. Some of the revenue management tool
which Thomas Cook different sectors applies for their business growth are given below:

 Room Sales Mix Projection: This tool helps company to generate revenue effectively by
selling rooms to the right customers at right time in order to attain high productivity.
However, Thomas Cook applies this tool as it enable them to predict or forecast of the
room sales as well as it helps them in minimising or controlling the room supply in order
to implement effective decisions to gain competitive advantage (Buhalis and Foerste,
2015).
 Discount Fixation: This tool is related with the gaining the attention of customer towards
company in order to attain high profitability. However, Thomas Cook provides
impressive and productive discounts regarding room rates or price based on the demand
of rooms. Along with this, they allow discount on room for a specific period of time
which serves two purposes such as protecting or preventing the rooms at higher rate and
encourage upselling. Furthermore, it is a technique which enable Thomas Cook to trade
up to a better version of what's being purchased. However, it enable the company to
generate additional income in order to generate high profit.
 Control of Reservation Period: This tool enables the Thomas Cook to maintain their
revenue generation as their reservation departments refuses the request of reservation
made by a guest for one night and accepts other reservations of multiple nights which
leads to attain higher level of revenue.
TASK 2
P3 Stages of HR life Cycle in travel and tourism industry
Human Resource Management also contains unique life cycle which plays a crucial role
in the enrichment of business operation (Bunghez, 2016). The HR life cycle is basically the
sequence of stages which employees go through during the accomplishment of organisational
goal. This cycle explains the phase of an worker's time in a specific organisation and the shifting
roles the Human Resource functions play in each stages. However, HR life cycle is an
important concept in the growth of travel and tourism industry as their main goal is to serve
customer effectively and efficiently in order to increase satisfaction level which adds value to
company's image. The issue of human capital is very important to long term development of
travel and tourism sector in Thomas Cook. They provide enormous employment to individuals of
all ages and skill level (Di Tella, 2017). And it depend on quality, available human resource to

develop and deliver competitive tourism product that meets consumer's changing needs.
However, each stages of HR life cycle contains their own challenges, opportunities and benefits.
In Thomas Cook HR life cycle work for the job profile i.e. manager. As, they has various duties
and commitment for which they require effective support from organization to develop their skill
and retain them to enrich business operations. Some of the stages of HR life cycle are as
follows:
 Recruitment: In order to grow business it starts with hiring the right candidate. In
Thomas Cook, hiring decision plays a vital role in turnover, productivity and growth.
However, to get success in this stage its HR adopt effective action such as create
strategic staffing plan as it involves to understand vacant positions, analyse
compensation and benefits etc. in order to attract more candidates towards company.
 Job description: This stage beings from the moment an employee start work in new
position. However, in order to increase satisfaction level Thomas Cook communicate
about its culture to them, providing effective training and develop their potentiality
which improves their morale and enrich company's productivity (Gianni and
Gotzamani, 2015).
 Motivation: This stage is an integral element in reduce retention rate of employees as
it concern with encouraging employees towards attainment of company's goal.
Therefore, Thomas Cook's HR effectively motivate its hired manager, by keeping
them engaged in decision making process, providing fair rewards and recognising
their effort. BY this, company can attain profit at higher level and add value to its
employees.
P4 Develop performance management plan for Thomas Cook
Performance management plan is one of the important and flexible tool which enable the
company to improve performance as it is also known as performance action plan. In Thomas
Cook, employees has several issues for which they identify new ways to resolve their conflicts
and build a healthy working condition. Performance Management Plan for Thomas Cook are as
follows:
 Plan: In Thomas Cook, they develops a set of rules and regulations in order to provide
effective service to their customer. By this, employees get a clear scenario of their work
and help them to attain organisational goal.

 Implement: As the HR of Thomas Cook, they should be very attentive in applying the set
plan into their business function and assign suitable employees in each role. So that they
put their full effort towards the accomplishment of per determined goal (Heo, 2016)
 Evaluate: After implementing the plan, Thomas Cook HR evaluate the performance of
employees and take corrective course of action. As they compare the work with setted
task, which enable them to implement effective decision.
 Feedback: Once performance get evaluated, there is a occurrence of this stage. In this
Thomas Cook, provide the freedom to customer to give their feedback regarding
company's performance. By this, company build positive attitude among employees and
enrich brand image which decreases labour turnover (Kask, Kull and Orru, 2016).
Every company faces several issues between superior and subordinate which has direct
influence on their working culture. Therefore, organisation are obliged to manage their employee
and give effective working culture to gain high productivity and profitability.
TASK 3
P5 Legislation that Thomas Cook has to comply and adhere
The UK government always recognised the importance of travel and tourism to the
economy and they introduce new policies and laws which are as follows:
 Package Travel, Package Holidays and Package Tours Regulation 1992: In this act, it
states that every tourism company provide package travel and holidays to customers
which generate high revenue to them (Khan and et. al., 2017). However, this regulation
ensures that there will be no improper conduct by Tour operator in delivering service
which was displayed to customer. Therefore, Thomas Cook applies this act in their
business which enable them, to provide high satisfaction level to customer.
 Disability Discrimination Act, 1995: This act main aim is to eradicate discrimination
which faces several people with disabilities. This governance requires that company
should encourage equality of possibility for multitude with inability. Therefore, Thomas
Cook implies this act which help them to treat every customers equally and it leads them
to enrich their brand image as well as improves the morale of company (Mason, 2015).
 Consumer Protection Act, 1987: This act prohibits the company from misleading
customer regarding price indications as it involves price of accommodation, service

facilities, products. However, Thomas Cook adopt this act in order to create positive
attitude among customer by being transparent in providing information which enhance
their profitability.
P6 How company, employment and contract law has potential impact on business
Every company is directed and controlled by effective legislation and regulation which
help them to accomplish organisational effectively and efficiently. Each legislation has its own
pros and cons which influence the working culture of company (Mohsin and Lengler, 2015).
Some of the examples of different companies who faced problems because of violation of law
are as follows:
 Yahoo, a famous web service provider who got caught in scanning customer emails and
handing the data over to NSA. For this they are fined for £ 2.5 million pound.
 Vizio, a leading company which develops consumer electronics was fined for 2 million
pound for violating the Video Privacy Protection Act. As they tracking user ID and they
share candidates information over company to meet their target.
 One of the big retail firm who deals in healthcare i.e. CVS Pharmacy was found out in
breaking Patient Privacy Law. As pharmacist yelled patients personal information
across the counter for which they fined for 1.5 million pounds.
Every company requires legislation and regulation which direct them and help them to be
more ethical and disciplined for attain high productivity. However, some cases are unpredictable
which influence their business operation and decision making. As well as it create a healthy
relationship with customer which enlarge its brand image and improves the morale of customer
in effective way.
TASK4
P7 Different types of financial statements and reporting mechanism for Thomas Cook.
Profit & Loss - Thomas Cook (India) Ltd.Rs (in Crores)
Mar'18Mar'17Mar'16Mar'15Dec'13
12Mon
ths
12Mon
ths
12Mon
ths
15Mon
ths
12Mon
ths
INCOME:

Sales Turnover 1903.2
2
1714.2
4
1724.2
5 500.89 378.10
Excise Duty .00 .00 .00 .00 .00
NET SALES 1903.2
2
1714.2
4
1724.2
5 500.89 378.10
Other Income 0 0 0 0 0
TOTAL INCOME 1937.5
7
1738.8
1
1753.9
0 513.58 383.60
EXPENDITURE:
Manufacturing
Expenses
1439.8
0
1279.7
4
1326.8
8 .00 .00
Material Consumed .00 .00 .00 .00 .00
Personal Expenses 194.05 175.86 179.68 215.66 147.90
Selling Expenses 44.28 43.48 .00 .00 .00
Administrative
Expenses 190.69 173.68 178.36 186.36 119.47
Expenses
Capitalised .00 .00 .00 .00 .00
Provisions Made .00 .00 .00 .00 .00
TOTAL
EXPENDITURE
1868.8
2
1672.7
5
1684.9
2 402.03 267.37
Operating Profit 34.40 41.48 39.32 98.86 110.73
EBITDA 68.75 66.05 68.97 111.55 116.23
Depreciation 18.36 17.62 17.36 14.78 11.19
Other Write-offs .00 .00 .00 .00 .00
EBIT 50.38 48.43 51.62 96.77 105.05
Interest 46.33 53.86 44.29 48.15 34.75
EBT 4.05 -5.43 7.33 48.62 70.29
Taxes 6.99 2.93 1.95 15.41 24.17
Profit and Loss for
the Year -2.93 -8.36 5.39 33.21 46.12

Non Recurring
Items 533.86 -1.38 -.13 .00 .00
Other Non Cash
Adjustments .00 .00 .00 .00 .00
Other Adjustments .50 1.38 .13 .00 .00
REPORTED PAT 531.43 -8.36 5.39 33.21 46.12
KEY ITEMS
Preference Dividend.00 .00 .00 .00 .00
Equity Dividend 10.96 10.95 12.11 10.78 7.71
Equity Dividend
(%) 29.59 29.84 33.08 39.53 31.12
Shares in Issue
(Lakhs)
3702.1
0
3667.6
0
3667.0
0
2727.3
1
2476.8
1
EPS - Annualised 14.35 -.23 .15 .97 1.86
Profit and Loss (P&L) statement is an important tool in financial statement as it summarizes
revenues, costs and expenses obtain during a specific period of time and it is also known as
income statement (Thomas Cook (India) Ltd., 2019).
BalanceSheet - Thomas Cook (India) Ltd.
Rs (in Crores)
Particulars Mar'18 Mar'17 Mar'16 Mar'15 Dec'13
Liabilities 12
Months
12
Months
12
Months
15
Months
12
Months
Share Capital 37.49 165.37 165.73 31.93 25.36
Reserves & Surplus 1652.9
6
1123.0
5
1131.4
1
1113.1
8 585.43
Net Worth 1690.4
4
1288.4
2
1297.1
4
1145.1
1 610.79
Secured Loan 142.58 182.94 3.16 1.28 1.24

Unsecured Loan -62.44 7.58 182.55 150.30 112.81
TOTAL LIABILITIES1770.5
8
1478.9
4
1482.8
5
1296.6
9 724.84
Assets
Gross Block 218.68 201.20 194.93 106.90 105.21
(-) Acc. Depreciation 33.87 23.05 11.80 43.72 42.11
Net Block 184.81 178.14 183.13 63.18 63.10
Capital Work in
Progress .89 5.77 2.97 1.17 4.13
Investments 1227.9
7
1227.6
7
1223.9
5
1158.3
1 593.29
Inventories .00 .00 .00 .00 .00
Sundry Debtors 367.41 219.16 189.31 216.10 176.16
Cash and Bank 688.63 446.58 506.68 164.45 92.79
Loans and Advances 481.80 198.15 204.23 233.33 158.53
Total Current Assets 1537.8
4 863.88 900.22 613.88 427.48
Current Liabilities 1179.9
4 795.75 817.11 516.54 342.60
Provisions 1.00 .78 10.31 23.32 20.57
Total Current
Liabilities
1180.9
4 796.53 827.42 539.85 363.17
NET CURRENT
ASSETS 356.90 67.36 72.80 74.03 64.31
Misc. Expenses .00 .00 .00 .00 .00
TOTAL
ASSETS(A+B+C+D+
E)
1770.5
8
1478.9
4
1482.8
5
1296.6
9 724.84

Balance Sheet provides the financial statement of an company based on that they can implement
corrective course of action in order to gain competitive advantage (Sierra, Pellicer and Yepes,
2015)
Thomas Cook key ratios are debt Equity ratio is 0.05%, current ratio is 1.30% and return
on assets is 30.01%./
P8 Importance and value of budget for controlling business performance and identifying
variances
Budget is the method of deciding the particular estimation for the activities which can be
take place while travelling. Thomas Cook helps in setting estimation of amounts for each activity
which is very important for the individual in order to control the inflow and outflow of cash.
Therefore, budget plays a very crucial role because before planning for any place, the individual
over looks their budget of money which they are capable of spending on a particular trip. It helps
in controlling the finances of the businesses (Tam and Gray, 2016). Therefore, following are the
importance of the budget for controlling business performances and identifying variances :
 It enable the company to evaluate or predict the future as it is the most important
characteristic of a budgetary planning and control system. Along with this, it allow
management to look forward, helps in developing effective plans for accomplish targets
of each department, to foresee and give the organisation aim and direction.
 It formalizes the skilfulness of action between business function while positioning
activities to the competitive world with the help of the organization strategic plan.
 It furnishes the instrument of decision making obligation and intensify management’s
obligation. Due to powerful plan, every department or unit works for the attainment of
business objectives and goals (Vellas, 2016).
 In addition, the budget maximises execution measurements which assures a common base
for communication that how manager met the objective and renders a conversation
point concerning why real outcome cut from the original budget.
 It promotes all areas within the business organization to become more cost-effective,
which rolls up to a higher efficiency organization across the globe. (Wang, Xiang and
Fesenmaier, 2016).
 This further helps in controlling money with effective and estimated revenues, plans
expenditure and restricts spending which is not a part of a plan.

 It further gives an insurance that the money is invested in those parts only which supports
the strategic objectives of the business.
 A well communicated budget plan helps everyone to understand the priorities of the
businesses. And this process also develops an opportunity to include staff and results in
sharing the vision of the organisation (Xiang, Magnini and Fesenmaier, 2015).
 It is also important because it involves team spirit and promotes the people to work
together to review and compare the budgets with the actuals and this provides
information regarding the strength and weakness of the businesses.
CONCLUSION
From the above report it has been concluded that travel and tourism has several aspects
which have positive and negative influence on business function. Every company has set of rules
and standards which helps them to monitor their financial performance by preparing journal
entry, trial balance etc. Performance management plan allows the firm to make effective
decisions to resolve conflicts of employees. However, HR policy and legislation enable the
company to guide their business function for achieving high productivity and profitability.

REFERNCES
Books and journals