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Write the Introduction to Tourism Systems For the ROI Analysis.

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A small settlement comprising of about five thousand people situated on the tip of peninsula forms the identification of the Clipper Bay. The economy of the town has been depending on fishing and the other business supporting the industry.

Being the “Chief Planner” of the Clipper Bay, a plan is needed to explain and describe the way to revitalize its economy.

The report describes the approach to recognize the best way for the above objective. CBA or ROI analysis with comparative advantage is used here. The sustainable approach is explained, with description of instances of superstructure and other components of the stakeholder model. Lastly, the economic, socio-cultural and environmental benefits and drawbacks are analyzed.

The tourism and economic revitalization go hand-in-hand. It needs a good environment since the industry could not survive in an unclean and unsafe environment. Since, Clipper Bay provides clean and pleasant environment, they have e good time in attracting business. Tourism also needs friendly people with good service (Brouder, 2014). As the people of Clipper Bay have the ability to offer good service, this would attract the new comers and have a good time holding one their business, employees and local population. Moreover, the industry needs a safe community. The police departments with other significant government agencies like first aid and fire could add to the community’s desirability (Brouder & Eriksson, 2013).

The first responders like health, fire and police could undertake pro-active roles as significant ingredients in the economic development of Clipper Bay. The community must seek economic development also because of hotels, good restaurants and other things to do. People from outside the community and foreigners must think to move any industry or business in the community (Brouder & Ioannides, 2014). As they could be treated very well from the very first, there lies the scope of overall development contributing the community as well as the nation.

Currently the world tourism has been growing in fast pace. The tourists have been now showing the growing tendency to visit distant and amazing places. The government leaders have now been aware regarding the significance of tourism at Clipper Bay as a major economic development tool. This peacetime industry has been the major origin of tax revenue, source of employment and urban revitalization.

Clipper bay is a small town at the shore of the sea, abundant with marine life. The town is also famous for tasty and fresh sea foods that are cooked by the women inhabitants. The women are also skilled in the art of weaving. In every season of summer, Clipper Bay has been hosting a festival marking the commencement of fishing season. The festival got characterized by their cultural and religious rites linked with heritage and customs. This runs for a week with celebration and feast.

Regarding the landscape, the town has a marvelous position at the foot-hills with effective accessibility and view of the beautiful beach. The beach comprises of the limestone clusters unique in nature. There has been also a presence of forest on the edge of the town.

Natural attraction

A highway is built in the recent days at the inland, providing a scope of rise in accessibility.

The economic theory of comparative advantage is suitable here regarding the work gains from the trade for people, organizations or the nation. This might arise from the differences in their technological progress or factor endowments (Barattieri, 2014).

Empirically the comparative advantage has been revealed by the Balassa index where Xij has been representing the exports of sector i from the country j.

The theory postulates that Clipper Bay could attain the comparative advantage effectively due to its high productivity in manufacturing products. Moreover the community has been well-endowed relatively with the production factors used in producing goods most intensively. Applying this community could specialize in particular service export provided the cross-country differences in endowments or technologies referring to the labor and capital.

The outcomes of the evaluation would generate the queries regarding who gets profit from the tourism impact and who has been bearing the cost (Mariani et al., 2014). The local residents of Clipper Bay would be the major recipients of the costs and benefits linked to the development of tourism. They would also be the part of the experience of the tourists while encountering with the visitors.  

This analysis would help in finding the three different pieces of data in measuring the marketing ROI (Tasci et al., 2016). They are the traveler or visitor profiles at Clipper Bay, the impact on economy because of the spending done by visitors and the impact of advertising campaigns over the incremental visits.

The sustainable approach to tourism could be identified by following some steps. This involves what they want to do, the needs involved, known knowledge, specialty behind the region, issues and its assessment (Edgell Sr, 2016). The objectives or principles for guiding the action, opinions and ideas, its implementation and lastly the statement of directions are also needed to be considered here.

The most important factors in the stakeholder model are described by the following table:

Macro-economic factors in stakeholder model

Fiscal policy

Monetary policy

Supply factors


Demand factors


The tourism policy factors



Exchange rate

The supply side in the tourism and is represented by the tourist attractions (Pulido-Fernández, Andrades-Caldito & Sánchez-Rivero, 2015).

Prices or cost of the factors

Marketing tools and implementation

Communication facilities, accompanying facilities, facilities of food and beverage, accommodation facilities.

Planning, financing (Poudel, Nyaupane & Budruk, 2016).

This could be demonstrated by the following table:



§ The multiplier effect: The tourism would benefit the other areas of economy known as the multiplier effect. This refers to the rise in the ultimate income rising from the tourism. The multiplier’s size rely on the marginal decisions of the household known as the marginal propensity for consuming and for saving it is the marginal propensity to save. It is the simplest form denoting how many times the money spent by the visitor would circulate through the economy of the nation (Marin, 2015).

§ Rise in employment: It could provide employment in informal sectors. Apart from this, the level of employment in tourism also follows the seasonality. There has been “high season” when the level of employment with tourist spending and visitation comes at peak. Simultaneously there have been “low seasons” also. The ratio of overall jobs created to the direct jobs according to recent researches, have highlighted an interesting point. The total employment affecting any sector is widely similar around every region. However, for Clipper Bay this might go down to relatively more inflexibility of the labors to move around the borders. This indicates that Clipper Bay might need to source their labor locally. This has made the overall employment impact relative to their direct impacting widely same around regions (Capacci, Scorcu & Vici, 2015).

§ Foreign Direct Investment (FDI): This could provide the Clipper Bay with an equity stake like car rental business, tour operator, in the hotel chain. This also includes the development and construction of hotel and other facilities, property development and development of attractions or theme parks. There could also be setting up as a supplier to the foreign or domestic firms and contracts of management for the service providers at Clipper Bay.

§ The role of entrepreneurship: This enhances the present fiscal year, job opportunities, self-employment, and the opportunities that could satisfy to fit the workforce.

§ This tourism would play a crucial activity in balancing of the relationships among nations

§ This could deliver employment at Clipper Bay and reduce migration from the rural to urban areas and the related influences over the urban area.

§ This could provide the government with tax revenues considerably.

§ The development of tourism could act as the growth pole stimulating the economy of a larger area.

§ This provides scopes for the small businesses

§ Leakage: There have been economic leakages. While studying tourism in Clipper Bay, the leakage has been the method in which the revenue has been generated by tourism has been lost to the economy of other countries. Leakage might become so important that it could partially neutralize the profit generated by Clipper Bay’s tourism.

§ Balance of Payment (BOP): This is the accounting record that shows the financial and economic situation of the nation in comparison with other nations. The international tourism at Clipper Bay could get directly affected by the BOP as the entry of invisible export. The effective contribution of the tourism at Clipper Bay might get appeared on the account of BOP under the international service’s entry. For discussing the favorable impact of tourism on BOP, the quantity of the revenues of foreign exchange for the nation should exceed the expenditure amount on foreign currency.

§ The money has to be borrowed for the capital investment. This could raise the national debt.

§ The industry is labor intensive. Thus it delivers numerous jobs of low paid, menial and at seasonal positions. The positions in management have been often filled by the MEDC people (Capacci, Scorcu & Vici, 2015).

§ The location of Clipper Bay could turn into over dependent over tourism. This could lead to the issues as the number of tourists fall because of external shocks.

§ The tourism has never been the effective use for the local resources.

§ The deals that are all inclusive never encourage the tourists in spending money in the local communities.

§ The trade agreements made internationally like the GATS or “General Agreement on Trade in Service” has been permitting the global organizations in setting up in most of the nations. This occurs even if the host government supports the local investors. This could not be prevented.

The tourism could create various opportunities regarding economy. It could also bring employments needed much with money in Clipper Bay. Despite all these the money has been managed by the international companies under MEDC. This indicates that the entire benefit never often reach to the people who have been lining in the LEDC.

They are demonstrated below:




§ For boosting tourism at Clipper Bay huge money has to invest for preserving the local heritage, improving the infrastructure, giving better local facilities. This in turn give rise to better leisure facilities, education and organizing social events providing better lifestyle for the people of the Bay (Kim et al., 2015).

§ They could easily interact with the visitors mixing with the people with diverse backgrounds. Thus a cosmopolitan culture could develop at Clipper Bay.

§ Because of the demand of better services, varied opportunities of employment could be created. This would reduce the necessity of migrating to other areas for livelihood.

§ The infrastructure might be unable to cope up with the rush due to heavy traffic.

§ Poor sanitation could appear.

§ The intrusion of the outsiders might create unrest and disturb the local culture.

§ Criminal activities might rise for fetching easy money from the tourists (Hong, 2015).


§ For attracting more tourism, emphasis should be given over the overall beauty of the environment like regular planting of the trees

§ Landscaping could be done for enhancing the aesthetics (Pearce, 2013).

§ Huge investment could be done for improving the facilities in Clipper Bay like sitting areas, drinking water, proper sanitation and shades.

§ Any type of development needs minimum interface with the nature. The development originates at the cost of nature in overall (Packer, Ballantyne & Hughes, 2014). However, there might rise the harming of the flora and fauna. The local people at Clipper Bay might get displaced for the development at the coastal area.

§ With the rise of people at Clipper Bay, the natural resources could be needed to be depleted more and more.

§ There could be cropping up without appropriate measures for handling the water disposal issues. This might worsen the situation.

§ Because of more transport, footfall, noise with improper waste disposal and the rise in pollution in the area could disturb the ecological balance of Clipper Bay.


It could be concluded by saying that the tourism sector at Clipper Bay might pervade a wonderful economic contribution for the nation. The global trend in this sector has been no longer in the direction of sea and sand tourism, but more upon cultural heritage, natural beauty and ease of accessibility. This has been a great method for its people in spending their money for the town to attract various people. In doing so, Clipper Bay could attract millions of dollars throughout the world, just for the reason that the foreigners get the scope of experiencing life in their place. The promotion of tourism at the town as the growing sector could be residing in the perceived potential in accelerating the growth of earnings, employment, earnings of foreign exchange and attracting capital investment. The concept to develop tourism to new heights would entail the trying to raise the number of arrivals per year, for rise in revenues. It should also process the instilling of development values and better livelihood for the people. It has been essential for the industry to be one of the national priorities of the current government ensuring the viability of tourism in future. This has been especially with the non-cruise tourism. This type of tourists positively affects the economy for than that of the cruised ones. For the tourism at Clipper Bay, to develop as the whole, the effective training must be done in various areas like natural sciences, social science, humanities and many more. The report has provided with scopes of various analysis like CBA and ROI and theories like comparative advantage for effective research. The study also reminds of various drawbacks on the economic, socio-cultural and environmental effects of tourism at Clipper Bay besides its advantages. Thus the report would further enhance the tourism industry along with business opportunities, future development and experiences at Clipper Bay. 


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Brouder, P., & Eriksson, R. H. (2013). Tourism evolution: On the synergies of tourism studies and evolutionary economic geography. Annals of Tourism Research, 43, 370-389.

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Pulido-Fernández, J. I., Andrades-Caldito, L., & Sánchez-Rivero, M. (2015). Is sustainable tourism an obstacle to the economic performance of the tourism industry? Evidence from an international empirical study. Journal of Sustainable Tourism, 23(1), 47-64.

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