Travel & Tourism Sector Report

This report provides a comprehensive analysis of the travel and tourism sector in the United Kingdom. It examines key historical developments, the sector's structure, the roles of national and international agencies in promoting tourism, and the influence of economic and political changes. The report also delves into factors affecting tourism demand and supply in London, specifically highlighting the economic, environmental, and social impacts of tourism. Strategies for mitigating negative impacts and maximizing positive ones are discussed, covering economic disparities, environmental concerns like noise pollution, and social conflicts. The conclusion emphasizes the sector's significant growth potential and the importance of government and international agencies in its development.

Travel and Tourism
Sector
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Key historical developments in the travel and tourism sector in the United Kingdom.........3
1.2 Structure of the travel and tourism sector..............................................................................4
TASK 2............................................................................................................................................5
2.1 The function of national government, government sponsored bodies and international
agencies in promoting travel and tourism....................................................................................5
2.2 How local and national economic policy influences the success to the travel and tourism
sector in UK.................................................................................................................................6
2.3 Implications of political change on the travel and tourism sector in the different countries.6
TASK 3............................................................................................................................................7
3.1 Factors affecting tourism demand in London .......................................................................7
3.2 Change in supply to meet the demand of tourism related products and services in London 9
TASK 4..........................................................................................................................................10
4.1 The main economic, environmental and social impact of tourism......................................10
4.2 Strategies used to reduce the negative impact of tourism and maximize positive impact ..11
Conclusion.....................................................................................................................................12
REFERENCES..............................................................................................................................14
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INTRODUCTION
Travel and tourism is the largest service provider industry which is growing at
fastest pace. This industry is known for providing maximum contribution to gross
revenue and foreign exchange earning (Bernado, 2015). Further, the contribution of
travel and tourism sector to the global economy is around 10%. in addition to this, it also
generates more than 277 millions job opportunities for individuals. Thereafter, the World
Travel-tourism council has predicted in 2016 there can be increase in contribution to
GDP by tourism with more than 3%. This states that travel and tourism sector have
ample amount of opportunities. Further, London is regarded as world's leading travel
terminus and gaining the attention of millions of international people around the globe.
In this report, the significance of travel and tourism sector to the economic development
of nation will be explained. Thereafter, the factors impacting the demand and supply of
services will be highlighted. Further, historical development in tourism sector will be
highlighted.
TASK 1
1.1 Key historical developments in the travel and tourism sector in the United Kingdom
In the contemporary scenario, the travel and tourism sector within UK is gaining
significant development that directly support in driving the economy of UK region.
Tourist nowadays prefer to visit the destination that are attractive and that render
different services that meet the requirement and need of the customers (Airey and
Chong, 2010).
The history of travel and tourism sector in UK has been divided into different
stages that is prehistory, transport, inter-war period and tourism take-off. In the past
years people are not aware about the travel but sooner the mindset and perception of
the individual get changed and it also developed within the certain time period
(Theobald, 2005). In the era, around 1660 to 1840 the customers or individual started
travelling to the other countries. In that scenario, the main aim of travelling is to visits
the holy places and destination for the religious purpose in-spite of travelling for having
the leisure and luxurious stay.
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However, after sometime the people prefer to travel in the other region or country
for the short span of time so that they may get knowledge or information regarding the
other individual with different culture background (Scott and Lemieux, 2010).
Thereafter, in the 18th and 19th century the tourism sector take-off with the increasing
pace that has observe the hike or growth within the UK travel sector. At this time period
many tour operators like Cox and Kings, Thompson, Thomas Cook etc. started their
operation and activities so that they may provide quality services to the tourist and
visitors. Although, in the present scenario the UK travel and tourism industry has been
developed at the fast rate (Ghimire, 2013).
1.2 Structure of the travel and tourism sector
Travel and tourism is consider as major sector in the contemporary scenario that
positively contribute in growing this industry as well as the economy of the destination
where visitors prefer to visits. This sector generally comprises of different services that
keeps attracting their customers and travellers towards the terminus. In this present
context, United Kingdom is consider as the biggest destination that is mainly preferred
by the travellers. In year 2014, UK was ranked at 8th position among the biggest tourist
destination that is favoured or best-loved by the travellers or visitors around the globe
(Hall, 2011).
The structure of travel and tourism industry primarily focuses on the attractions,
transportation, tour operators, accommodation etc. that constitute the overall structure
of UK travel sector. The key component within this structure of travel and tourism
industry includes attraction points (Scott and Lemieux, 2010). The main purpose of
traveller is to visit the attraction points and key places in UK. The attractive destination
in UK increases the number of visitors that includes London, Edinburgh, Liverpool,
Manchester etc. that contribute within overall economy as well as also develop the
travel and tourism sector.
Another element that constitute the travel and tourism industry of United
Kingdom include organizations that mainly focuses on providing accommodation
services to the visitors. There are different luxurious as well as budgeted hospitality
organization that focuses on providing low cost accommodation service to the travellers
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(Newsome, Moore and Dowling, 2014). In UK there are different organization that
renders leisure and luxurious accommodation services to their customers and visitors
that includes Marriott international, Hilton, IHG groups etc. all these are the leading firm
that provide luxurious accommodation services to the travellers.
TASK 2
2.1 The function of national government, government sponsored bodies and
international agencies in promoting travel and tourism
In the present scenario, there are various governmental agencies, funded
organization as well as different international organizations that renders services in
promoting this sector within the UK region (Padin, 2016). The UK government enforce
and design different laws and regulation that would support the organization within
travel and tourism sector so that should render proper services to their visitors and
travellers. The main aim of the UK government within this industry is to heighten the
inflow of foreign revenue through attracting large number of travellers, promoting them.
The functioning of different national government as well as international agencies of
travel and tourism are-
 SEDA (South of England Regional Development Agency)- SEDA is the
governmental body or an organization whose main function is to promote the
responsible as well as sustainable travel within England (Burkhard and et. al.,
2012). The governmental organization was mainly set up to meet the economic
challenges as well as opportunities existing in the market.
 Regional tourist board- Another organization is regional tourist board that is
consider as governmental funded organization whose main function is to promote
and attract large number of travellers and visitors to visit this country or region. In
addition to this, regional tourist board also supports the tourist in providing advice
about the different places. (Weaver, 2011).
 United Nation World Tourism organization- UNWTO is a specialized agency
of United Nation that is responsible for promoting tourism as an effective
instrument. This organisation supports the economy in the future as it will result
in driving the economic growth of the region (González, 2011). Another function
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of UNWTO is that it promote the development of tourism sector as an essential
factor and encouraging travel around the world.
2.2 How local and national economic policy influences the success to the travel and
tourism sector in UK
In United Kingdom, the local as well as national economic policy plays a vital
role in attaining success from the travel and tourism sector. In the recession year that is
2009 UK has resulted in decreasing their GDP annual rates that ultimately effect in
lowering or reducing the number of visitors in UK. Although with the help of changing
local and national policy within the UK government can control the tourism rate (Cuccia.,
2011).
For instance; with the help of exchange rate policy the exchange rate of UK is
stronger as compare to the other foreign currency. Thus, with the help of effective
exchange rate policy foreign or international travellers can easily visit UK destination
and spend their money in the different services (Bentley and Page, 2008). However, the
economic policy within UK are highly influenced and get affected by the different
international institution that will affect their cash inflows and outflows. However, with the
lower rate for exchanging the currency, UK government will result in generating huge
revenue and net income with increasing number of tourist and visitors in the region. As,
customers prefer to spend less income on the variety of other services that are within
the travel industry. In addition to this, with the higher rate of currency exchange will
result in reducing the number of visitors as the exchange rates are too high and
travellers do not prefer to visit this place.
2.3 Implications of political change on the travel and tourism sector in the different
countries
The political changes within the country highly impact the travel and tourism
sector as no traveller will prefer to visits such places where political parties are not in
the stable condition. However, the unstable political environment within the tourist
destination swill not able to provide the safe and security services for the visitors and
tourist of the different countries. However, it can be said that attractiveness of the
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destination get increases or decreases with the sudden or quick change in the political
factor (Burkhard and et. al., 2012).
For instance; China is consider as one of the most emerging country in the Asian
market that has stable political environment. As the china has stable political
environment thus, they mainly focus on developing and processing the travel sector with
enabling setting up the new hospitality organization or creating a man-made place of
attraction that will support the country in driving tourism (Newsome, Moore and Dowling,
2014). On the other hand, sometime travel agencies also get affected by the change in
the political parties. For example, with the war and terrorist attack in Iran has decreased
their number of tourist and visitors. The political change have also result in affecting this
sector as such war places or place with the no role of political or government are being
preferred by the visitors or travellers.
Other than this, UK is also consider as one of the leading tourist destination
under which change in the political perspective in the UK it will positively impact the
travel and tourism sector. For instance; at the time of election manifesto the economic
value of their monetary system get decreased as an outcome of economic breakdown
(González, 2011). Therefore, in such situation it results in increasing the number of
tourist and visitors in the UK because of the services within the economy get cheaper
due to decrease in the value of their currency.
TASK 3
3.1 Factors affecting tourism demand in London
London has been identified as leading travel destination. The city has attracted
more than 15 million tourist every year. Further, in 2014 there was rise in tourist
percentage by 20%. In addition to this, the tourist spending is recorded at £13.56 billion
(World travel and Tourism. 2015). Still, there are large number of factors that can impact
the demand of tourism in London. To maintain the lucrativeness of this sector it is
important for government to consider these factors. The explanation of which is as
follows:
 Income of individuals: The earning of individuals can affect the demand of
tourism. For example, decrease in household income of individuals of country
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can reduce the tourism demand. It will also relate to multiplier affect that states
with the increase in income, individual is likely to spend more on travel (Hjalager,
2010).
 Economic policy: The economic polices relates to the impact of economic
variable like, GDP, GNP, interest rate, unemployment rate etc that can affect the
demand of tourism. For instance, interest rate of UK is lying at 0.5 % which is
very less as compared to other countries. Therefore, the UK citizen can increase
their expenditure on domestic travel.
 Lack of infrastructure: The lack of availability of good infrastructure like, hotels,
restaurants, airports, railway stations, sea connectivity etc can impact the
demand of London tourism (Weaver, 2011). In addition to this, lack of structure
can cause inconvenience among customers.
 Currency fluctuations: The fluctuations in currency rate can impact the demand
of tourism. Further, if the tourist are the citizens of the same country having
strong currencies than it is likely to impact the spending of customers on tourism
(Novelli, Schmitz and Spencer, 2006). Therefore, it will adversely affect the
number of individuals visiting London and spending there money on different
products and services.
 Increasing noise pollution: With the alarming rise in noise pollution from air
flights, transportation etc. can cause a negative effect on the tourist of London
and therefore reduce the tourism demand (Theobald, 2005).
 Lack of service provider: Due to increase in employee dissatisfaction in travel
and tourism sector the employee turnover is increasing in travel and tourism
sector. The main reason of this is long working hours including night shift
compulsory work on public holidays or weekends etc. poor wages, exploitation of
workers (Scott and Lemieux, 2010).
3.2 Change in supply to meet the demand of tourism related products and services in
London
To assure maximum profitability the supplier of services in travel and tourism
sector can adopt significant measures to meet the increasing demand by ensuring
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proper supply of services (Bentley and Page, 2008). Since, travel companies comprises
of large number of suppliers that can impact the demand of tourism services in London.
To ensure success, it is important for suppliers to make significant changes in its
supply patterns to meet the changing demand effectively. In this respect, following
factors can be considered.
 Increase in demand of leisure tourism: Presently, there have been increase in
demand of holiday making by leisure travelers. Therefore, the travel companies
have started including attractive services in its tour package like, Spa, sauna and
steam bath, visit to theme park, pubs, gymnasium, pool, luxurious resorts or
villas (Theobald, 2005). Further, travel organization are closely knitting up with
leading hotels, resorts, theme parks etc to fulfill the leisure needs of customers.
 Enhanced technology: The customers like to buys those services only that can
be purchased easily with minimal efforts. Therefore, travel organization are
introducing high tech and high touch technology in marketing their services and
meeting the demand of customers. In summation to this, mobile applications are
designed so that customer can book the services through cellphones or tablets.
Further, virtual reality concept can be used which will enable travel-tourism
organization in creating artificial environment of London using software, 3D
modeling etc. (Hjalager, 2010).
 Eco tourism: With the growing concern of individual towards environment, the
concept of environment friendly travel has been launched by tourism
organization. Therefore, service providers like, British Airways, Virgin Atlantic etc.
are taking measures to improve the fuel efficiency so that Co2 emissions can be
reduced (González, 2011). Likewise, hospitality organization, hotels, restaurant
take proper measures to maintain health and hygiene of their customers.
 Development of infrastructure: To meet the increasing needs of customers in
London, more infrastructure can be developed. In this respect, air connectivity of
city with other countries should be increased by launching new flights etc.
Thereafter, public and private amenities like, hotels, restrooms etc. can be built
that will help tourist in peak seasons (Thrane and Farstad, 2011).
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TASK 4
4.1 The main economic, environmental and social impact of tourism
Variety Positive Negative
Economic impact Economic development of
nation
The tourist spending in
London in 2014 was more
than
£13.15 billion. Therefore,
this earning of nation
leading to economic
development of London
(Novelli, Schmitz and
Spencer, 2006).
Increase in employment
The tourism sector is
providing 1 out of 11 jobs
for the international
economy. Therefore,
improvement in tourism will
increase job opportunities
for population of London
(World travel and Tourism,
2015).
Economic disparities:
Touristry may cause
economic disparities in the
nation because holiday
making will be more in
famous destinations than
other areas (Burkhard and
et. al., 2012). Therefore,
development in traveler
terminus will be more in
London neglecting the other
areas and leading to
economic disparities (Scott
and Lemieux, 2010).
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Environment impact Conservation of historical
places
To encourage tourism in
London, government will
focus on conserving
heritage and historical
places in London (El-
Gohary, 2012).
Increased noise pollution
The noise pollution in
London is increasing due
flights take off and landing,
local transportation etc.
Overcrowding
increase in visitors are
leading to heavy problem of
traffic congestion and
causing inconvenience to
local public.
Social impact Overall improvement of
local citizens
Due to increase in tourism
sector in London every
year, local individuals are
learning foreign languages,
taking higher education so
that they can employ for the
vacant positions in tourism
sector. Therefore, it is
resulting into improvement
of local citizens (Navickas
and Malakauskaite, 2015).
Conflicts
Many a times, tourist does
not respect the culture,
customs and beliefs causing
problems to local citizens.
This may further lead to
conflicts between localized
communities and travelers.
4.2 Strategies used to reduce the negative impact of tourism and maximize positive
impact
To encourage tourism in London and assure economic development of nation, it
is important for country to reduce the negative impact by maximizing the positive
impacts. Therefore, strategies that have been used in this respect are as follows:
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 Economic impact: To reduce the issue of economic disparities in London
significant for local authorities to focus on marketing of unpopular destinations.
Therefore, new marketing strategies were devised like, advertisement in travel
magazines, newspapers etc. In addition to this, infrastructure development in
unpopular destination will help in increasing tourism to such areas (Wu and et.
al., 2016). In summation to this, more job opportunities should be provided to
local citizens for reducing unemployment level. The local individuals can be
educated and trained so that they can take jobs in tourism sector.
 Environment impact: To minimize the negative impact of tourism various
measures have been taken. For instance, airline companies were asked to use
smooth aircraft approaches. Thereafter, for promoting local tourist cycles, Eco
friendly travel options. Thereafter, to resolve the problem of overcrowding, traffic
rules have been improved and traffic inversion systems can be used (Padin,
2016).
 Social impact: To minimize the cases of conflict between local individuals and
tourist, different steps have been taken by the local government. For instance,
cultural shows were organized in London that aimed at educating tourist about
culture, customs and beliefs of country (Cuccia, 2011). Thereafter, local citizens
have been given education about tourism as the source of earning for the
country. therefore, friendly relationship should be maintained with them.
CONCLUSION
Summing up the entire report, it has been identified that travel and tourism sector
is growing at fast pace. It has ample amount of growth opportunities. Thereafter,
government, government bodies and international agencies plays an important role in
the progress and development of travel and tourism sector. The regional tourism board
and United nation world tourism organization are some regulatory bodies that promote
tourism to generate fruitful results for economy. However, there are various factors like,
income of customers, multiplier effect, noise pollution etc. that can impact tourism
demand in London.
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