Economic Analysis of Travel and Tourism Sector in UK, Scotland

This report provides an analysis of the travel and tourism sector, focusing on the UK and Scotland. It examines historical developments, the structure of the sector, and the roles of local, regional, and national government bodies in promoting tourism. The report also explores the influence of economic policies and political changes on the sector, using Scotland as a case study. Furthermore, it discusses factors affecting tourism demand in Edinburgh, how supply has adapted to meet demand, and the economic, environmental, and social impacts of tourism on Edinburgh. Strategies to minimize negative impacts and maximize positive ones are also evaluated, offering a comprehensive overview of the travel and tourism landscape in the region.

TRAVEL AND TOURISM SECTOR

Table of Contents
INTRODUCTION................................................................................................................................2
TASK 1..............................................................................................................................................3
1.1 EXPLAIN THE KEY HISTORICAL DEVELOPMENTS IN THE TRAVEL AND TOURISM SECTOR IN
GENERAL WITH A FOCUS ON THE UK..........................................................................................3
1.2 EXPLAIN THE STRUCTURE OF THE TRAVEL AND TOURISM SECTOR IN GENRAL AND UK IN
PARTICULAR.................................................................................................................................5
TASK 2..............................................................................................................................................7
2.1 ANALYZE THE FUNCTIONS OF THE LOCAL, REGIONAL, AND NATIONAL GOVERNMENT
SPONSORED BODIES AND INTERNATIONAL AGENCIES IN PROMOTING TRAVEL AND TOURISM
WITH RESPECT TO UK AND SCOTLAND.......................................................................................7
2.2 EXPLAIN HOW LOCAL AND NATIONAL ECONOMIC POLICY INFLUENCES THE SUCCESS OF
THE TRAVEL AND TOURISM SECTOR WITH RESPECT TO THE CASE STUDY OF SCOTLAND.........9
2.3 DISCUSS THE IMPLICATIONS OF POLITICAL CHANGE ON THE TRAVEL AND TOURISM
SECTOR IN DIFFERENT COUNTRIES............................................................................................11
TASK 3............................................................................................................................................12
3.1 EXPLAIN THE FACTORS AFFECTING TOURISM DEMAND IN EDINBURGH............................12
3.2 EXPLAIN HOW SUPPLY HAS CHANGED TO MEET THE EFFECTS OF DEMAND FOR TOURISM
RELATED PRODUCTS AND SERVICES IN EDINBURGH................................................................14
TASK 4............................................................................................................................................16
4.1 EVALUATE THE MAIN POSITIVE AND NEGATIVE ECONOMIC, ENVIRONMENTAL AND
SOCIAL IMPACTS OF TOURISM ON EDINBURGH.......................................................................16
4.2 EXPLAIN STRATEGIES THAT CAN BE USED TO MINIMIZE THE NEGATIVE IMPACTS WHILE
MAXIMIZING THE POSITIVE IMPACTS ON EDINBURGH.............................................................18
CONCLUSION.................................................................................................................................19
1

REFERENCES...................................................................................................................................20
2

INTRODUCTION
There have been a lot of changes that took place in the sector of travel and tourism in the last
few years in the world. These changes in the sector were due to several different factors and
had positive as well as negative impacts on the organizations belonging to the travel and
tourism sector. The following assignment discusses about the historical developments and the
changes that have been occurred in the travel and tourism sector of the UK as well as the
Scotland. There are several different tour operators that work within a nation to provide
different tour packages and offers to the local as well as international tourists.
From the given case scenario for this report, it can be analyzed that the rate of travel and
tourism within the nation like Scotland has been enhanced drastically in the last couple of
years. The people from different parts of the world have visited Scotland to visit the tourist
destinations of the country. The tour operator like Visit Scotland offers an assortment of
different tour offers and packages to the local as well as international visitors so that they can
enjoy the beauty of various tourist destinations of the country. There are several different
factors that have positive as well as negative impacts on the travel and tourism sector of the UK
and Scotland; these different factors are also discussed effectively in this following report.
3

TASK 1
1.1 EXPLAIN THE KEY HISTORICAL DEVELOPMENTS IN THE TRAVEL AND
TOURISM SECTOR IN GENERAL WITH A FOCUS ON THE UK
The sector of travel and tourism has been changed drastically in the last few years due to the
several historical developments. The changes in the travel and tourism sector of the United
Kingdom have enhanced positively the economic conditions as well as the GDP of the nation.
An assortment of historical developments has taken place within the sector of travel and
tourism since the previous few eras (Amaro, et al. 2015). The key historical developments in the
sector of travel and tourism of the UK have been classified into several different sections.
These sections of the historical developments are as follows:
POST INDUSTRIAL SITUATION
There have been several significant steps and activities that are involved in the post-industrial
situation of the United Kingdom. These diverse activities and steps enhance the
interconnectivity between the different areas as well as the economic transactions of the
nation (Anna, 2016). UK has always been the nation with a lot of traffic for the trade and
purchase purposes and thus the post-industrial situation of the UK was well established.
POST WAR DEVELOPMENTS
UK is considered as the center of significance, finance, and culture. Thus, the prosperity and the
reputation of the city entail the country. UK has experienced the period of several wars and the
government of nation has released almost all the terrorists of the nation so that they can return
to their respective home countries like China, Hongkong, etc. After the completion of wars, the
nation and the travel and tourism sector has to face several economic crises.
CURRENT DEVELOPMENTS
4

With the changing time periods and eras, there have been a lot of changes in the travel and
tourism and tourism sector. The modes of transportation have been immensely changed and
developed with time. The different modifications in the modes of transportation that took place
include; carts, buses, trains, airplanes, jets, ships, etc. (Barkauskas, et al. 2015).
Thus, these are some of the key historical developments that took place in the travel and
tourism sector with respect to the United Kingdom.
5

1.2 EXPLAIN THE STRUCTURE OF THE TRAVEL AND TOURISM SECTOR IN
GENRAL AND UK IN PARTICULAR
The sector of travel and tourism is very vast and the development rate of this sector in the
United Kingdom has been increasing very rapidly and continuously. There is an assortment of
different components of the structure of travel and tourism sector. These different components
include; tour operators, transportation, accommodation, travel agents, catering, information
and guiding, tourist attractions, etc. (Briassoulis, et al. 2013). These different components are
responsible for the development and growth of the public as well as private sectors of the
travel and tourism in the nations like UK and Scotland.
Figure: 1. Components of Tourism Industry
[Source: http://www.technofunc.com/index.php/domain-knowledge/travel-and-tourism-
domain/item/components-of-tourism-industry]
The different aspects that are allied to these components of travel and tourism structure are as
follows:
6

TOUR OPERATORS
There are several tour operators present in the market such as; Visit Scotland, Visit Britain, TUI
Group, Thomas Cook, etc. that provides an assortment of different tour packages to the local as
well as international visitors. The major role of tour operators is to maintain the continuous
development of travel and tourism sector of the nation (Chen, et al. 2016).
TRAVEL AGENCIES
The primary motive of this component is same that of the tour operators, i.e. to maintain and
enhance the development rate of travel and tourism in the country. There are several travel
agencies present in the UK that serves its targeted audience in the market with a variety of
different holidays and tour packages.
ACCOMMODATION
It is one of the most important components of the travel and tourism structure. The tourists
from different parts of the world visit several places and tourist destinations. Thus the tour
operators provide the facilities of accommodation to the tourists which consist of; catering,
housing, lodging, hotels, guesthouses, campsites, etc. (Choi, et al. 2010).
Thus, the above mentioned are some of the key components which depicts the structure of
travel and tourism sector of the United Kingdom.
7

TASK 2
2.1 ANALYZE THE FUNCTIONS OF THE LOCAL, REGIONAL, AND NATIONAL
GOVERNMENT SPONSORED BODIES AND INTERNATIONAL AGENCIES IN
PROMOTING TRAVEL AND TOURISM WITH RESPECT TO UK AND SCOTLAND
In order to promote the travel and tourism within the nations like UK and Scotland, the role of
local, national, and regional government bodies is very vital as well as significant. These
governmental bodies aid to develop sustainability within the nation. The sector of travel and
tourism contributes positively in the enhancement of nation’s GDP and therefore every
government of the globe is interested in promoting and supporting the travel and tourism of
the country. The functions of these different governments with respect to the promotion of
travel and tourism in the UK and Scotland are as follows:
LOCAL GOVERNMENTS
There are several different functions of the local governments that aid to support travel and
tourism sector of the nation effectively. These different functions include; leaning of tourist
sites, fulfillment of sites’ requirement, maintaining of tourists’ safety, etc. (Deery, et al. 2012).
REGIONAL GOVERNMENTS
The local government sends notes to the regional government to seek their approval for the
sanction of funds that can be received from the national government. The major role of the
regional government is to monitor the working of local government towards the development
of travel and tourism sector.
NATIONAL GOVERNMENTS
The primary function of the national government is to sanction the funds that are required by
the local government of the different areas so as to successfully maintain the sustainability of
the tourist destinations.
8

BRITISH TOURIST AUTHORITY
This type of governmental sponsored body develops an assortment of different policies to
encourage the rise of travel and tourism within the nations like UK and Scotland (Dincer, et al.
2015).
INTERNATIONAL AGENCIES
The role of international agencies is very vital for the promotion of travel and tourism in the
different nations of the world. The different international agencies which promote this sector in
Scotland and UK are as follows; International Civil Aviation Organization, World Travel Tourism
Council (WTTC), International Air Transport Association, etc.
Consequently, these are some of the key functions of the different types of governments and
governmental sponsored bodies for the promotion of travel and tourism in the nations like UK
and Scotland.
9

2.2 EXPLAIN HOW LOCAL AND NATIONAL ECONOMIC POLICY INFLUENCES THE
SUCCESS OF THE TRAVEL AND TOURISM SECTOR WITH RESPECT TO THE CASE
STUDY OF SCOTLAND
From the case scenario of the Scotland it can be analyzed that the rate of travel and tourism
has been enhanced within the nation since the last few years. This enhancement in the
increment of travel and tourism sector has influenced the economic conditions of the Scotland
in both positive as well as in negative ways. The marketing department of the tour operators
likes Visit Scotland utilizes several different tools such as PESTLE analysis to carry out market
research in order to analyze the economic factors that could influence the success of travel and
tourism sector within the Scotland. The local as well as national economic policies influence
success of the nation’s travel and tourism sector in several ways. These influences with respect
to the case scenario of Scotland are as follows:
DIRECT INFLUENCE
The local as well as national economic policies directly influences the sector of travel and
tourism in Scotland by changing the financial rates, conversion of exchanging currency rates,
etc. For example; by decreasing the rate of Pound, the government of Scotland attracts visitors
from different parts of the world (Hagen, et al. 2016).
INDIRECT INFLUENCE
There are several factors that lead to the imposing of indirect influence on the success of travel
and tourism sector of the Scotland. The indirect influences include; reduction in the popularity
of sites, decrement in the reservation of sites, increment in the maintenance cost, etc.
ECONOMIC POLICY
From the case scenario of Scotland it can be noted that the inflow of currency is low within the
travel and tourism sector of the nation and thus the foreign reservations are decreasing
continuously within the Scotland.
10

Thus, in these ways the local and national economic policy influences the success of the travel
and tourism sector of Scotland.
11