Skills for Travel and Tourism Start-ups: A Business Plan

Desklib provides past papers and solved assignments for students. This report explores skills and financial planning for travel and tourism startups.

Skills for Travel and Tourism Start-ups
1

Table of Contents
Introduction....................................................................................................................................3
Task 1............................................................................................................................................4
Task 2............................................................................................................................................8
Task 3............................................................................................................................................9
Conclusion...................................................................................................................................15
Reference List..............................................................................................................................16
2

Introduction
In order to develop a travel and tourism enterprise, it is essential for entrepreneurs to possess
certain skills that would benefit them in establishing a travel and tourism organisation in the
competitive market economy. The following report will provide appropriate information regarding
the type of skills that exist within successful entrepreneurs of the travel and tourism industry.
Subsequently, a brief business plan will be developed to understand the basic financial
resources necessary for launching a travel and tourism business successfully. The study would
also provide extensive self-evaluation that would allow the learner to understand the existing
skills within themselves.
3

Task 1
A) Discuss the entrepreneurial traits and skills required to be a successful travel and
tourism entrepreneur
In order to succeed in the travel and tourism industry and become a successful travel and
tourism entrepreneur, several skills and traits need to be evident within the individual. The
existence and predominance of these skills and traits would prove beneficial for the individual to
achieve a successful business in the travel and tourism industry in a competitive market
economy (Kuratko, 2016).
The following entrepreneurial skills are essential for an entrepreneur in developing a
successful business organisation in the travel and tourism sector:
 Self-management: The ability of an entrepreneur to manage personal activities and
decided entrepreneurial activities simultaneously is essential to develop an appropriate
business organisation.
 Communication skills and interpersonal skills: These skills are required for an
individual to succeed in the travel and tourism industry as it allows potential
entrepreneurs to perform better communication with other individuals of different levels
and express their opinions efficiently.
 Time management skills and leadership skills: It is essential for entrepreneurs to
perform appropriate leadership and time management for the relevant tasks within the
organisation. The ability of an entrepreneur to lead their employees in appropriate time
scale through difficult tasks will ensure their success in the business development
process.
 Travel and tourism skills: It is essential for an entrepreneur of the travel and tourism
industry to possess the relevant skills for the travel and tourism industry. This will enable
the entrepreneur to provide appropriate guidance to the customers and the employees
(Burns, 2016).
 Planning, organisation, analytical and research skills: These skills enable the
entrepreneurs to develop an appropriate business plan for their organisation in the travel
and tourism organisation. These skills are beneficial for the entrepreneur to design
business objectives according to the available resources appropriately.
4

The following entrepreneurial traits are evident in a successful entrepreneur operating in the
travel and tourism industry of a competitive market economy:
 Creative, innovative and inventive in disposition: These traits allow entrepreneurs to
develop a business organisation in the travel and tourism industry that is unique and
creative in disposition and procedure.
 Entrepreneurial and risk-taking abilities: These traits enable an entrepreneur to
perform better within the organisation and in the travel and tourism sector of the country.
The risk-taking abilities of an entrepreneur enhance the business st5ratgey of the
organisation through developing new plans and business strategies (Parker, 2018).
 Self-sacrificing nature: This trait of entrepreneurs within organisations in the travel and
tourism sector allows them to develop innovative strategies that prove successful in the
competitive market economy.
The entrepreneurial skills in accordance with the entrepreneurial traits within an individual allow
the person to develop their business conducting abilities (Barringer, 2015). The success of the
entrepreneurial business venture is possible through the development of individual traits and
skills by applying the functional elements within their entrepreneurial business venture.
B) Using an appropriate format, produce a self-appraisal (self-assessment) of
entrepreneurial traits (characteristics) and skills that you may possess and identify the
strengths and weaknesses for development benchmark to be a successful
Self-assessment of Entrepreneurial Skills and traits in Travel and Tourism
Entrepreneurial Skills Ratings Remark (justify your score)
Self-management - -
Planning and Organization 8% I tend to plan my activities in
advance and do not like
making changes at the last
moment
Communication and
Interpersonal skills
8% I join in debates and
discussions with my peers
and like to interact with many
5

people
Numeracy skills
7% Since school days, I loved to
solve mathematical quizzes
and puzzles
Managing Time Effectively
9% I know the skill of prioritising
work and maintain a diary to
manage time effectively
Leadership and People skills
7% I am good at managing small
teams and directing them to
achieve a task
Research and Analytical
skills
9% I like to go through various
websites and journals and
summarise the data
Travel and Tourism skills
8% I have gained enough
knowledge about the travel
industry through there is
scope for improvement
Entrepreneurial Traits Remark (justify your score)
Entrepreneurial
7% I like to experiment a lot take
risks which is the essential
quality of an entrepreneur
Risk-taking and self-
sacrificing
- -
Goal oriented and
achievement drove
- -
Creative/Inventive and
Innovative
9% I like to experiment with a lot
of new ideas and like to come
up with innovative solutions
9% I tend to be quite confident
and direct while taking
6

Ambitious and Confident important life decisions
Tenacious and Perseverant
10% I do not give up easily unless
the task is completed
Motivated and hardworking
10% I tend to work hard over my
projects and set equal priority
to everything involved in the
project
Curious and Discovering 10% I like to keep discovering
options and look for change
and development in a
positive direction
Charismatic 10% After giving a presentation
and seminars, my fellow
mates suggested that I have
the capacity to persuade a
large number of people
Table 1: Self-assessment
(Source: Created by the learner)
7

Task 2
A) Select a successful travel & tourism entrepreneur and analyse his or her business
development strategy and the entrepreneurial process by evaluating the factors that
could have led to the success of entrepreneur’s business organisation
In this study, the chosen travel and tourism entrepreneur is Grace Lee, who is the founder of
WishPoints. WishPoints is an app that allows the service users to record their travel desires or
wishes and the app allows its users to share the wishes with family members and friends
(Wishpoints.co, 2019). Her business development strategy has been designed in such a way
that it meets the needs of the travellers. Discounts are often given to attract and retain
travellers. This idea popped up in her mind from her own travel experiences. She used to work
in the healthcare industry, and a part of her job involved travelling. During her free time, she
used to be worried about coordinating with friends and then she identified that this issue could
be met because she has a background in data aggregation. While working on her healthcare
job, she once attended the start-up weekend competition 2012 and got a direction to implement
her idea. In spite of being busy, she kept on working consistently on her start-up idea and this
lead to the development of WishPoints. In the year 2016, she persuaded WishPoints on a full-
time basis, and finally, the app generated more than 3 million users.
Therefore, it can be stated that by being consistent in her efforts, she was able to turn her start-
up idea into a successful business venture. Since then, Lee has been working on generating
maximum profits from the business. Her business idea is focussed on making use of user data
in order to collect travel discounts. She has been successful in this venture because she used to
focus on one goal at a time and never attempted to do everything at once. She also stated that
dealing with new obstacles is the only way forward. By doing little each day, she has been able
to gain momentum.
By applying the Ansoff matrix to the business strategy Grace Lee implemented in her
organisation WishPoints, it can be observed that the company utilises a market penetration
strategy by providing discounts to the consumers who wish to travel to different locations. The
business strategy implemented by the organisation in the market economy by creating
appropriate budgets and production methods serves as a unique selling point for the company.
In addition to the Ansoff matrix, considering Porter’s generic strategies for WishPoints provide
8

information that the company succeeds in the business economy through the effective strategy
of cost leadership in the travel and tourism sector.
Task 3
A) Evaluate and discuss the sources of finance and support available to you for the
proposed project
A travel and tourism company named Golden Tours will be set up in Glasgow, UK and as an
entrepreneur; various sources of funding can be used since financing is the essential
component for any company. At times, it can be difficult to access funds or cash for running
their own business. However, various sources have been evaluated in the context of their own
project-
Crowd-funding – A crowd-funding campaign can be launched with financial support from family
members or peers. It can be an effective platform for receiving cash. In return, various rewards
can be given as the option of valuable merchandising (Kuppuswamy and Bayus, 2018).
Discover England Fund - In England, the government has announced a three-year £40million
Discover England fund for the tourism industry as the industry creates jobs and economic
growth in the country. For year 3 (2018/2019), the government will provide a fund of £22.0
million (Gov Grants Hub UK, 2019). By making use of the fund, the proposed project can be
established, and future challenges like financial risks in handling the business can be met as
well.
B) Develop a business plan with a market assessment, business analysis and cash-flow
analysis and justify the potential for success of the proposed Travel and Tourism
business
Market Assessment
For starting a travel and tourism company, it is essential to conduct a thorough analysis of the
external and internal environment. Hence, SWOT and PESTLE frameworks have been used to
assess the existing market.
9

Internal Analysis: SWOT
Strengths
 Making use of social media to spread
the brand name
 Glasgow city can attract a large
number of tourists due to the presence
of ancient cathedrals, museums and
has historic importance. This can be
profitable for Golden Tours as it will
attract tourists (Mooney and Danson,
2018)
Weaknesses
 The business might fail if management
operations are weak
 Poor customer service
 High debt burden
Opportunities
 Scope for expanding the market online
 Can develop new agencies
 By knowing the interests of the
customers, services can be modified
(example- attractive discounts for
Holiday Packages)
Threats
 Competition from existing travel
companies like Caledonian Travel and
Trailfinders Glasgow
 Government regulations in the UK
Table 2: SWOT analysis for Golden Tours
(Source: Created by the learner)
External analysis: PESTLE
Political factors In the UK, political instability can affect the travel business as
there could be a decline of tourist inflow in Glasgow.
Economic factors After the recession of 2008, the economic condition in the country
has been disturbed. In this scenario, the establishment of a travel
company can be quite risky.
Socio-cultural factors Customers tend to have high expectations from the tourism
industry because it is a leisure-centric industry. They want timely
and effective services, and therefore, Golden Tours might attempt
to meet these needs by providing.
Technological factors The people in the UK are tech-savvy and can avail online booking
10

services easily. Hence, Golden Travels can implement this
strategy in their own operations to attract more customers.
Legal factors Golden Travels need to operate in Glasgow by following the
guidelines of the Association of British Travel Agents (ABTA). It
also needs to have Air Travel Organisers Licensing (ATOL) for
selling airline tickets.
Environmental factors In tourist destinations, environmental impact is felt widely
because tourists tend to consume resources rapidly (Westphal,
2017). Hence, Golden Travels has to follow the EIB’s
environmental policies to reduce pollution levels.
Table 3: PESTLE analysis for Golden Travels
(Source: Created by the learner)
Business Analysis
Marketing Segmentation, Positioning and Targeting
For tapping into a market, it would be crucial for Golden Travels to segment its new market
based on the profile of the customers (Tanner and Raymond, 2015).
Customer Profile – Young travel enthusiasts and families
Expectations of customers- The young generation thrives on better connectivity (Wi-Fi
facilities) and expect adventurous activities to be incorporated in travel packages
(Schlegelmilch, 2016)
Targeting strategy – The travel destination would be promoted by advertising the brand name
in social media platforms.
Marketing Mix
Factors Description
Product Golden Travels will provide attractive holiday packages to travel
enthusiasts
Place Tourist destinations in Glasgow, UK
Price The price of holiday packages will be reasonable, and occasionally
discounts will be given
11

Promotion Social media platforms will be used for advertising the brand name
Process The ERP software would be utilised, and by making use of 3rd party
bookings, external bookings will be integrated.
People The target customers will include young travellers in the UK
Physical
evidence
The company will be established in Hill head district, Glasgow
Table 4: Marketing Mix
(Source: Created by the learner)
Cash Flow Analysis
Particulars Amount (£)
Cash flow from operating activities
Cash received from customers 15000
Cash paid to suppliers -1200
Other operating expenses paid -1100
Net cash from operating activities 12700
Cash from investing activities
Purchase of equipment -3500
Sale of old equipment 900
Net cash from investing activities -2600
Cash from financial activities
Payment of long term debt -5000
Interest paid -800
Proceeds from capital contributed to the capital 1300
Drawings -1500
Net cash from financial activities -6000
The net increase in cash 21300
Cash at the beginning of the year 1600
Cash at the end of the year 22900
Table 5: Cash Flow
(Source: Created by the learner)
C) Present a persuasive business plan for the Travel and Tourism start-up project
12