LO 1: Task 1
A. Examine the recent trends and developments in the tour operations industry with a brief analysis of the type of holidays taken, the emerging popular destination and the effects of current and recent trends and developments on the tour operators industry.
M 1: Using effective approach to study and research, explore the complex problems related to the recent trends and developments in the tour operating industry
LO2: Task 2
A. Assess the stages and timescales in developing holiday packages and prepare an itinerary for a combined heritage, wildlife and beach holiday and develop a package in stages.
Department of Travel, Tourism and Hospitality Management
B. Evaluate the suitability of different methods of contracting the various components of the holiday for different types of tour operators when developing holidays.
C. Carryout the cost of the components of the package and calculate the selling price of your holidays
M2 Synthesize and process complex information and data related to the stages involved in creating holidays using different combinations of attractions and timescales
D1 Evaluate an alternative itinerary for the proposed package based on the timescale and cost, and justify the appropriateness of the selected package.
LO 3: Task 3
A. Design and plan a brochure and evaluate the process and planning decisions for the proposed brochure, as well as assess the suitability of alternative methods (nontraditional) of communication and promotion for different types of tour operator.
B. Analyse and Evaluate the non-traditional methods of distribution that can be used to sell holiday packages for different types of tour operator (P3.3)
M 3: Appropriate structure and approach is used to design holiday brochure
D 2: Substantial activities are planned, managed and organised in designing and developing the brochure for class presentation
For this task, you need to consider yourself being promoted as a senior manager with a role of making strategic decisions.
Trends and Developments Affecting Tourist Industry
Tour operator industry is considered as an integrated towards the travel and tourism sector. This unit 14 explores the trends and development that affect the tourism industry and the destination that has been selected. Contemporary issues in the industry and their impact have been discussed. Price determination and selling method have been analysed in the report with the objective of strategic decision making. The study also includes the details related to the different types of methods that are used for making the brochures and the facilities that offer the customization by entering into the retail market which can bring the rise in the distribution channel. In addition to this, the various types of analysis have been done which helps in understanding the effectiveness of the industry in the market. The different strategies which are discussed which can be used to enhance the demand of the products and services.
The case scenario is based on the tour operator who is working for the large UK based company as a Package tour development manager. The current experience is related to the account manager for the 3 different holiday destination which is different from the previous work that was to manage the PR and promotion for tours. The case reflects that there is need to develop a package for the new type of clients who are concerned in excursions holiday at ancient heritage sites and wildlife parks with the few days of beach outings in a hot destination. Bali is the place that is selected as the destination which includes numerous sunny beaches and the heritage with wildlife attractions in Asia.1.1 The effects of current and recent trends and developments on the tour operators industry
There is a rise in the tours leads to the rise in the industry that contributes in executing the holidays. Along with this, there are numerous emergent trends and development that directly impact the industry (MacIntyre, 2017). Similarly, there are some trends which create the direct impact on destination Bali and these trends are
Rise in disposable income: - This has been witnessed that the rise in the GDP leads to the rise in the income of the people. The year 2017, the Bali provincial and regional government find a rise in the income of people by 13% with the rise in inflation rate by 2.7%. In addition, there is a rise in the income by 9.5%with the inflation of 4% which is possible because people have started investing their amount in visiting the place (Retalk Asia, 2017). This will bring the rise in the disposable income of the people which will be utilized by them to visit the place.
Planning and Execution for Holidays
Updated technology: - Tourism industry is totally depended on the technology like the use of technology makes the rise in tourism of people. The technology contributes to improve the quality and standards of the Bali which will lead to the rise in the number of tourists (Bowie, Buttle, Brookes and Mariussen, 2016). In addition to this, up gradation in the technology affects the tour industry as they need to adopt the same to remain in the market.
Marketing techniques: - The marketing is one of the effective sources which make the customer aware about the destination that they should visit. The tour operator industry gets affected with the market because the marketing of destinations will make the switch the needs and preference of customers (Evans, 2015). Accordingly, the tour operators need to bring the changes in destination preferences. Thus, the rise in the preference of visitors towards Bali is possible because of the effective marketing techniques.
Customized products: - The tour operators are offering customized products to the customers which are the only way through which they can win the trust. Thus, this is found that a wide range of products and service can lead to the success of the industry (Bowie, Buttle, Brookes and Mariussen, 2016). The visitors and tourist like to visit the tour operators so that they can visit the places in Bali where they want to go accordingly to their preference.
Competition: - The rise in the competition is one of the factors which affect the tour operators. Increase in the competition leads to the rise in employment and equilibrium of demand and supply. This will make the customers choose for the most suitable option which helps them to deal with the competition. This is considered as the emerging problem which affects the tour industry.
Planning with the timescales is considered as the initial process of every activity which leads to the overall framework of activities that support for the suitable decisions that contribute in evaluating the viable options (Axelrod, 2015). This section includes the discussion related to the different stages that contribute in developing the plans for the holidays.2.1 Assessment of the stages and timescales involved in developing holidays
Selection of destination: - In the current era, there is a different destination which are still present where most of the tourist likes to visit. The research related to the travel destination can be done according to the willingness of the customers to visit the place. This has been found that tourists are majorly visiting places like Paris, New York, Rome, Sydney, Bali, China, Thailand, Singapore and many others. It is essential to select the place out of which Bali has been selected for which the research has been done with the use of PESTEL analysis and this research gets complete in the two or three months.
Types of Contracts in Tour Operator Industry
Development of the tour itinerary: - Once the destination gets selected that it the time which includes the summarizing the tour programs which include destinations, travel routes, accommodation, transportations and the place which are required to be visited in Bali. The tour operator takes the responsibility in which they finalize the places where they will take to the visitors. This systematic flow will help them in conducting the operations effectively without any barriers (Leanza, Porto, Sapienza and Cascone, 2016).
Negotiation: - Once the tour operators decided the places and accommodation then they proceed with the negotiation with the vendor so that they can get the best price in Bali. The tour operator needs to offer the services to the entire group for which it is must control the process. The tour operators ask for the might discount from the vendors and it takes time to complete the stage as the operator need to consider the alternatives and selecting the vendor which offer the services and products at low prices.
Price determination: - The next stage after the negotiation there is price determination of the packages. There are different factors that directly affect the pricing of the packages include the cost of fuel, foreign exchange rates, taxes and many others. The tour operator needs to determine the prices of packages which they charge from the visitor including their profit for the Bali tour. Majorly, there are two types of methods that can be used for determining the prices of packages which include cost-oriented and market-oriented.
Marketing: - The tour operator needs to conduct the activity of marketing which helps them in increasing the awareness among the market for the customers. This will not only contribute in increasing the demand but also leads to profitability with goodwill. The marketing will help the tour operator in getting the groups of customers.
Execution: - Execution is considered as the last stage of the tour operator in which they will convert all their preparation and estimation into the reality. All the planning of the tour operators gets implemented with the problem planning which helps in monitoring and controlling the activities.
Selection of the destination (Bali)
Development of the tour itinerary
Time and days of the tour
2.2 The suitability of different methods of contracting for different components of the holiday and different types of tour operator
Incurrent era, the tour operators generally enterprise the packages by allowing for the various types of features and with the use of the two types of methods which include fixed contract and sale only contract. The UK tour operator makes use of the two methods that remain suitable for contracting the different components of the holiday. These methods help in contracting with the vendors and suppliers. These methods are: -
Case Scenario on Package Creation
Fixed contract: - In this kind of contracts the major focus is on the collective and quantitates approach with the motive of sales. The tour operators in the UK will bring the rise in their capacity by enhancing the volume of sales. Majorly, the tour operator makes use of this method for availing the benefit in offseason (Mason, 2015). This has been found that tour contractors get the benefit from the fixed contract in terms of the cost-effectiveness by receiving the huge amount of discount and benefits in terms of prices. Though, there might be the case in which the tour operator remains with no profit because they won’t be able to unable to utilize the benefits of the discount due to issues in tours.
Sales only contract: - In the sale the only contract of the tour operator the prices generally remains high then the fixed contracts. The sale contract generally takes place at the time of season considering the demand of the customers present in the market. The risk factor remains less in the sale only contract because the tour operator doesn't remain liable (Smith, 2014). This has been found that this type of contract remains beneficially for the UK tour operator when the customers’ demands for customization in their packages.
In the addition, comparing both the methods, this has been found that high risk offers the high profit to the tour operator which is possible with the fixed contract as it includes high risk comparing it with sales only contract (Page, 2014).2.3 Calculate the selling price of a holiday
In the case, the planning has been done for the three different destinations that are included in the package that can be customized by the wants of customers. These destinations include Bali, Singapore and Malaysia (Irwana Omar, Ghapar Othman & Mohamed, 2014). The budget for the trip is essential to be calculated for per person and per couple. The tour operators have the contacts in Bali and Malaysia which help them in negotiation and getting the effective price for the tour of 20 people with 3 couples. The hotels in the places are offering their services at affordable prices.
Calculation of accommodation: - The twin room with a special rate of 60 euros and supplement for BB is 10 euros for per person every night. Thus, the couples in the groups can avail the single room which means 3 rooms= 60*3= 120 euros. In addition, the remaining 14 people 5 rooms with 4 single beds that is equal to 60*5= 300+4*10= 340. For 6 nights, the amount will be 120*6= 720 euros and 340*6= 2040. In total it is equal to 2760 British pound.
Calculation of transportation cost: - The amount of transportation will be equal to 1200 British pound with a 25-seater luxury coach that includes the cost of drivers and fuel.
Charges of tour guide
Add- Profit margin @ 12%
Thus, this has been found that the total price on which UK Tour Company will sell their packages in 4715.2 British pounds.
In the travel industry, it is must for the company to make the customers aware of the products and services. The brochure is an effective document that contains the required information for the customers which helps them in taking the steps towards it.3.1 The planning decisions are taken for the design of a selected brochure
This technique grabs the attention of the customers as it is low-cost marketing way which extends the reach of customers. Brochures can be offered to the visitors by the UK tour operator with the help of online and offline mode (Huertas?Garcia, Laguna García and Consolación, 2014). Further, there is discussion related to the process and planning decisions for the proposed brochure.
Issue identification for developing brochure: - It is essential for the UK tour operator to design the issue before developing the brochure. This issue includes market segmentation, target market, the format of the brochure and the information to be discussed with the time that is involved in the execution of the brochure.
The format of the brochure: - The brochure includes the systematic flow of the information due to which it includes different sections and sub-sections in the brochure. This is the only way through which these brochures become attractive (Zulkifli, Alnagrat and Mat, 2016). The format is selected by the tour operator according to their target market. This mainly includes: -
- Name of the tour operator
- Mode of transportation
- Travel destination and itinerary of travel schedule
- Accommodation and meal facilities
- Price (with explanation related to distribution)
- Conditions and charges applicable
- Legal requirement
Budgeting and selecting target market: - Before issuing the brochure it is essential to determine the budget and target market. The market segmentation can be done by analysing the needs and demand of the different customers and accordingly selecting the most appropriate market for products and services. The budget includes the spending power of the customers for the services (Kaplan and Atkinson, 2015).
The timescale for completing this stage: - It is essential to design the brochure in the specific time period. In this stage, the planning process will convert into execution with the strategic method and decision making.3.2 The suitability of alternatives to a traditional brochure for different types of tour operators and recommend the most appropriate for your tour package
In the current era, this has been found that traditional printed method is not an effective method for the customers in attracting and retaining. Though, the new technology with the emerging digitalization has brought new ways which include: -
- E-brochure: - E-brochure is one of the effective ways to reach towards the customers and reduce the cost of preparing the brochures. The electronic brochure includes the different pictures and video that contributes in developing the interest of the visitors.
- Social media: - Social media is considered as one of the effective manners which are required to be accepted by the tour operator for generating the awareness among the large audience for the products and services in the market (Lee and Kotler, 2015). The UK tour operators can make use of Facebook, YouTube and many other channels for promotion.
- Websites: - Website includes the information related to the products and services which allow the customers to access each and every detail (West, Ford and Ibrahim, 2015).
This has been found that in today's world every industry expands and diversifies their distribution channel which helps them to meet the demand with supply. The traditional method of preparing the brochure is converting into the emerging methods which include the use of technology. These sources include e-brochure, website, social media and many others and these tools are effective to increase the profitability of the tourism industry. These tools offer different benefits to the tour operators which include effective management of cost and time. Accordingly, the tour operator can make use strategic directions while making the selection for tools of sales and distributions that affect the growth of Tour Company.4.1 Strategic decisions made by different types of tour operator
Strategic decisions by the company contribute in achieving the goals and objectives effectively. This shows that different tour operator's response to the trends discussed in task 1 with the help of strategic decision making. Below given are some of the strategic directions: -
- Demand forecasting: - The tour operator makes use of the strategic direction of demand forecasting in which they evaluate the demand for the future travel holiday products and services. This decision helps them in offering certainty in business and meeting the gap between customer perceived value and expectation.
- Segmentation, targeting and positioning- Customers are segmented by modification of the clients considering their features and demand. According to this, the customer who targeted the company needs to design the packages (Grant, 2016). These packages will help the company in deciding the position in the market.
- Risk management: - Risk can affect the working of the tour and travel industry due to which the operators manage the risk. The tour operator can involve in the risk due to fixed contracts due to which they need to keep the balance between the fixed contracts and sale of contact.
- Marketing: - Promotional strategies are an effective tool to make them aware of products and services. Different methods like e-Brochures, social media and website are effectively used for promoting the products as this will enhance customer attraction (Grant, 2016).
It is the fact that tactical decisions are crucial for the effective successively and implementation activities within a company. These decisions majorly emphasis on the short-term concerns and to fulfil the day to day requirements. The tour operator takes the tactical decisions at the time of negotiating and selecting the different service providers which are related to the arrangement of accommodation, transportation, food and services. In addition, the industry also makes the decision that can contribute in maintaining an effective relationship with the stakeholders by offering the financial resources in an industry (Nagle and Müller, 2017). These decisions involved frequent analysis related to the frequent segment and specific promotion, tactical pricing determination of packages with the maintenance of the daily transactions.
It has been found that there are numerous factors that influence tactical decisions. The major factors that influence the tactical decisions include: -
Information and communication technology: - The tactical decisions of the tour operator get affected by information and communication technology as ineffective communication it is the need for every activity. In case, if it has been found that there is a lack of effective communication techniques with its implementation in the course of decision making then it remains ineffective.
Regulatory framework: - While taking the tactical decision the tour operator need to look towards the laws and regulation which is required to be followed by them. In case, the tour operator is unable to meet these regulations and laws. In case the company is not able to meet the regulations then they will be liable for the relative prosecution.
In the end, it can be concluded that this paper reflects that deep study related to the tour operator industry. There are different various feature and factors that affect the working of the industry. It includes the recent trends and development in the travel industry that can affect the working. In addition, this report is based on analytical study of different aspects related to the various tour operators. The allocated task supports in evaluating the existence and role of a tour operator in organising the tour for different destinations in the market. In addition, there is discussion related to the various types of contracts with their effectiveness and worthiness in the various types of holiday packages. The costing of the packages is also discussed in respect to the destination that includes Bali, Singapore and Malaysia. In the end, it can be said that the industry contributes effectively in the GDP of countries. Though, there is the presence of certain types of risks that are required to be managed by the manager for the UK tour operator.
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