Exploring Entrepreneurial Ventures in the Travel and Tourism Sector

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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
Table of Contents
Introduction......................................................................................................................................3
Task 1 (LO1)....................................................................................................................................3
1.1 Entrepreneurial Traits and Skills required to a successful Travel and Tourism Entrepreneur
.....................................................................................................................................................3
1.2 Self-assessment of Entrepreneurial Traits and Skills, and identification of Strengths and
Weaknesses..................................................................................................................................5
Task 2 (LO2)....................................................................................................................................9
2.1 Development of an Entrepreneurial Enterprise.....................................................................9
2.2 Factors leading to the success of this Enterprise.................................................................10
Task 3 (LO3)..................................................................................................................................12
3.1. Evaluation of the sources of finance and support available to enterprise in the travel and
tourism sector.............................................................................................................................12
3.2 Developing and justifying the potential for success of a concept from an enterprise in
travel and tourism industry........................................................................................................13
3.3. Persuasive business start-up plan........................................................................................14
Conclusion.....................................................................................................................................15
References......................................................................................................................................16
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Introduction
In the modern business environment, the importance of entrepreneurship is becoming
increasingly important, since an entrepreneurial venture embodies a new and innovative idea and
creates new possibilities for the business market. This study will highlight on the various aspects
of entrepreneurship, along with its characteristic skills and a self-assessment analysis. Moreover,
aspects of Virgin Atlantic as an entrepreneurial venture, and design of a proposed entrepreneurial
plan will also be discussed.
Task 1 (LO1)
1.1 Entrepreneurial Traits and Skills required to a successful Travel and Tourism
Entrepreneur
As the travel and tourism sector is related to service sector, an entrepreneur working in the travel
and tourism sector is characterised as a creator of a new business style for the travel and tourism
service, which enhances customer satisfaction and helps the business organisation of the
entrepreneur to gain an increased sales figure (Kirzner, 2015). The most prominent skills and
traits for an entrepreneur working in the travel and tourism industry can be analysed as follows:
 Passion: Dees (2017) opined that all entrepreneurs in travel and tourism business are
immensely passionate about their business, as being able to deliver better travel and
tourism services to their customers is more valuable to the entrepreneurs than the profit
gained from their business.
 Innovation: This is basically the most prominent skill of an entrepreneur. In case of
entrepreneurs working in the travel and tourism sector, they develop new and innovative
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styles of delivering the travel and tourism business, such as creating new and unique tour
programs at affordable prices.
 Self-confidence and Communication Skills: The confidence level of the entrepreneurs
in travel tourism industries is very high. In fact, Kuratko (2016) opined that they are so
confident about their innovated tourism business plans and strategies that they do not
falter even when their business meets failure, and adhere to that strategy until it sees
success. Moreover, they a have excellent interpersonal communication skills, which let
them convince their clients more easily, enhancing their business efficiency.
 Open-mindedness: The entrepreneurs in the travel and tourism industry are extremely
open-minded, which helps them to understand the positive and negative aspects of any
new idea, and come up with great innovative tour programs or strategies to raise
customer satisfaction (Burns, 2016).
 Competitive Nature and Risk Handling: An entrepreneur is always competitive in
nature, so that he or she always aims to be the best in the market, and raise the brand
reputation of his or her organisation. For entrepreneurs in the travel and tourism industry,
they always aim to provide the most comfortable and comprehensive tour services at
affordable prices, and become the best in the tourism industry. Moreover, entrepreneurs
have to be able to be able to take business risks.
 Discipline and Work Ethics: Storey (2016) opined that an entrepreneur usually always
has a good sense of work ethics, and he or she always maintain it in his or her activities.
In case of entrepreneurs working in the travel and tourism industry, they are usually the
ones who show professional discipline and work hard, and inspire other employees to
give their maximum efforts as well, which drastically increase the business success.
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
Thus, it can be seen that travel and tourism entrepreneurs show a great level of motivation and
passion to create innovative tourism packages and various travel-related services at affordable
price range, which allow them to attract a lot more clients than ordinary tourism organisations
(Etzkowitz and Zhou, 2017). Moreover, travel and tourism entrepreneurs show a much higher
level of commitment and take responsibility for any faults, which enhances their reputation
among clients.
1.2 Self-assessment of Entrepreneurial Traits and Skills, and identification of Strengths
and Weaknesses
Entrepreneurial Trait or
Skill
Numerical Rating
(In a Scale of 1 to 10)
Explanation with Evidence
Passion 9 I am extremely passionate
about working in the travel
and tourism industry. I
always study about the
success stories about famous
tourism and travel
entrepreneurs such as Richard
Branson, and inspire myself
from them.
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
Innovation 7 I regularly study about the
various business strategies in
the travel and tourism sector,
and gain innovative ideas
from them. I believe this will
help me to meet client
expectation more effectively.
Self-confidence 9 I have a good level of
confidence in myself, and I
believe that I will be able to
design travel and tour
packages that will be able to
satisfy clients.
Communication Skills 5 While assessing my skills, I
have found out that my
interpersonal communication
skills are lacking. For
instance, when I asked for
feedback from my peers and
teacher, they stated that I am
impatient, and thus lack
listening skills. Moreover, my
non-verbal communication
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
skills also need some
polishing.
Open-mindedness 8 As I study about various
travel and tourism business
strategies, I have grown to be
quite open-minded. I also
observe the existing tourism
business operations closely,
and accept any good idea
from them.
Competitive Nature and
Risk Handling
9 I have assessed myself to be
quite competitive in nature, as
the increased competition of
business environment only
increases my spirit towards
aiming to be a successful
entrepreneur in the market.
Discipline and Work Ethics 9 I always maintain a good
level of discipline. For
instance, I always form a
schedule for my daily
activities, and strictly follow
it. Hence, I believe that I will
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
be able to follow discipline as
an entrepreneur in tourism
business. Moreover, I always
prefer to maintain ethics in
my activities, which indicates
that I will maintain ethical
standards in my professional
career.
Financial Skills 5 As for my financial
management skills, it is
lacking in many areas. For
instance, I am not very
proficient in optimising the
business budgets, and
therefore I have to learn the
financial and accounting
techniques in order to
enhance my entrepreneurship
skills.
Table 1: Skill Audit for Self-Assessment as Entrepreneur
(Source: Learner)
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
The above self-evaluation clearly indicates that my strong points are my passion, innovative
capabilities, self-confidence, competitive nature, open-mindedness, discipline and work ethics, as
I have scored an average of approximately 8.3 out of 10 in these skills of mine. On the other
hand, it can be clearly seen that my weaknesses are my communication skills and financial skills,
as I have scored an average of 5 in these two skills. Therefore, my chance of success as an
entrepreneur in the travel and tourism industry is drastically increased due to my passion for
tourism, my competitive mentality, and most of all my innovative nature. However, my lack of
communication skills, particularly my listening skills and body language will have to be
improved to prevent potential miscommunication with clients, and my financial skills will also
need to be enhanced for increasing business profitability.
Task 2 (LO2)
2.1 Development of an Entrepreneurial Enterprise
In the modern business market, many entrepreneurial enterprises have grown to be quite
successful by innovating and implementing unique business models that has managed to leave
quite significant impacts on the travel and tourism industry (Goss and Sadler‐Smith, 2018).
Among them, one of the most successful entrepreneurial enterprises is Virgin Atlantic, founded
by Richard Branson in 1984 as a subsidiary of Virgin Group of Companies. The rise of Virgin
Atlantic clearly shows that there are several prominent stages for a successful entrepreneurial
enterprise, and the positive and negative aspects of these stages are analysed as follows:
 The first stage is all about the personal passion and motivation of the entrepreneur to start
his or her own business, or to decide to change the business strategy of an existing
organisation that he or she works in as an intrapreneur. Gonzalez and Winkler (2018)
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ENTREPRENEURSHIP IN TRAVEL AND TOURISM INDUSTRY
argued that in this phase, the entrepreneur assesses the feasibility of an entrepreneurial
idea that he or she is considering implementing in business, and identifies potential
market opportunities. Richard Branson carefully examined all opportunities in the travel
and tourism market before starting his Virgin Atlantic, which is why it experienced a
huge success of 1 million ticket sales within 1984-87.
 The second stage is vital, as it involves entrepreneurial decisions regarding the financing,
share market analysis and business structure (Brookes and Altinay, 2015). Richard
Branson showed excellent judgments while choosing the airlines business for his Virgin
Atlantic as there was a huge demand for new international airlines services in Europe and
America in the decades of 80's and 90's.
 The third stage involves designing products and services to be offered, and Virgin
Atlantic showed excellent judgment in designing the price of their air tickets, which
allowed even medium-class and low-class earner to buy air tickets during seasonal
discounts.
 Engel, Kaandorp and Elfring (2015) opined that he fourth and last stage comprises of
devising a comprehensive marketing strategy, which involves establish communication
with their potential clients, establishing business facilities and, most importantly,
devising a reasonable and achievable organisational goal. In case of Virgin Atlantic,
Richard Branson managed to devise effective marketing strategies, which helped Virgin
Atlantic to establish a large size of loyal customer segment within a short time.
2.2 Factors leading to the success of this Enterprise
As it has been seen, the establishment of a successful entrepreneurial enterprise goes through
many steps, which allows an entrepreneur to gradually start his or her business by evaluating the
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market ad his or her own capacity. It has been the same case with Virgin Atlantic, as it is one the
entrepreneurial venture in the travel and tourism industry. However, Muegge and Reid (2018)
argued that it has been seen that even though most of the entrepreneurial ventures are established
through the above mentioned stages, not all of the entrepreneurial ventures become successful. In
case of Richard Branson's Virgin Atlantic, there were certain factors that were responsible for its
massive success in the travel and tourism industry. These reasons can be analysed as follows:
 Efficient Promotional Strategy: One of the main reasons for the immense success of
Virgin Atlantic has been its promotional strategy. For grabbing the customer segment
having relatively lower level of income, Virgin Atlantic has managed to introduce
promotional and seasonal discounts for their air tickets, and they also introduced various
promotional offers featuring tour packages and other conveniences (Baxter, 2019).
 Efficient Marketing Strategies: In order to attract customers, Virgin Atlantic took an
efficient marketing strategy, and aimed to draw in customers from all segments. They
divided their airplanes into different sections such as economy class, premium class and
business class for clients with different level of income and purchasing power. Naturally,
the facilities that are provided to these classes are different, and Virgin Atlantic took
specific marketing and advertising tactics for each of these sections (Giannantonio and
Hurley-Hanson, 2016).
 New Venture Strategies: One of the greatest entrepreneurial moves by Richard Branson
was to utilise the multidirectional connectivity of Virgin Atlantic in order to have tie-ups
with various other travel agencies and hotels in order to gain an even larger customer
segment. For instance, Virgin Atlantic had managed to provide complete tour packages at
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a discounted rate by joining hands with their business partners and joint venture partners,
who are mostly the large international hotel chains (Vintean, 2017).
 Strategies for enhancing service qualities while minimising wastes: In order to
maximise their profit, Virgin Atlantic adopted the approach of lean management while
not compromising with the quality of their services. For instance, in order to reduce the
wastage of food and catering services, Virgin Atlantic conducted internal researches to
estimate the approximate amount of food ordered and food wasted, and used optimisation
techniques to determine the most balanced food catering policies in their airbuses.
Moreover, Hurley-Hanson and Giannantonio (2015) opined that they also enhanced the
service efficiency in their airbuses by revising their recruitment and training strategies,
which allowed them to increase the expertise of their employees, and deliver their
customers with better services.
Thus, it can be seen that the primary reasons behind the success of Virgin Atlantics are their
efficient business strategies, and their emphasis on the marketing strategies and joint ventures.
Unlike many organisations who tend to avoid the joint venture strategies due to the fear of loss,
Richard Branson took that risk as an entrepreneur, and proceeded to have tie-ups with various
large hotels in order to provide discounted tour packages to their customers (Baxter, 2019).
Moreover, the idea of mnimising wastages helped greatly in the long run, as it meant less
operational cost. All these factors combined led to the success of Virgin Atlantic as an
entrepreneurial venture.
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