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Unit 19 Tour Operations Management Assignment

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INTRODUCTION

Tour operations industry has been identified as most significant sector that has an integrated approach towards travel and tourism. It involves management of various operations that includes development of holiday packages, monitoring current trends and strategic decisions that need to be taken by tour operators (Gibson, 2012). Present report is based on analysis of effects of current and recent trends and development on tour operations industry. As a product development manager at Trailfinders Ltd, which is travel company in the UK and Ireland, there are different stages involved in development of holiday’s packages are also discussed along with the suitability of different methods of contracting for various components of holidays. In addition to this, selling prices for tour package is determined in the report. Moreover, planning decisions are taken for selected brochure by different tour operators are also discussed. Suitability of alternatives to traditional brochure for various kinds of tour operations. Further, different methods used for selling of holiday packages are also evaluated. At last, strategic decision made by various kinds of tour operator are analysed along with the tactical decision that needs to be taken Trailfinders Ltd.

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TASK 1

1.1 Stages and timescales involved in development of holidays

Planning is has analysed very important aspect in tour operations industry. It is required for tourism service providers to plan activities in sequential basis for development of holiday’s packages which will attract the tourists.

There are various stages involved in development of holiday’s packages which needs to be followed by Trailfinders Ltd. These important steps are mentioned below

  • Market research: It mainly involves overall research of the tourism and environment of country to identify the trends as well as factors that direct affects decisions of holiday’s packages (Robinson and et.al., 2016). Moreover, research of market includes economic which provided clear understanding about culture of country and spending power of people in country. With appropriate market study Trailfinders will be able to take appropriate decision regarding prices, service and requirement of customers.
  • Planning and scheduling: This step of development involves planning and taking decision regarding locations, accommodation, travelling cost (Evans, Stonehouse and Campbell, 2012). Transportation services, amenities and attractive that needs to be visited etc. has been taken in to consideration. Trailfinders needs to make proper schedule of these activities.
  • Contracting: At this stage, a manager of Trailfinders tends to create a contract and sign a contract with its customers. All terms and conditions, activities and prices are mentioned in tourism contracts. It is legal formality and needs to be accomplished by organisation without mistake.
  • Costing: This stage involves analysis and measurement of cost that needs to be incurred by organization in a particular holiday’s package. Budget for every tour package has been made Trailfinders in their tour packages (Redjem and Marcon, 2016). With appropriate analysis of cost, organisation can set selling price of holidays packages and also able to influence its customers towards products and services.
  • Financial evaluation and pricing: This stage involves calculation of expenses and profit margins on holidays to analyse the fluctuation in prices of products and services. Through effective financial evaluation, Trailfinders will set effective selling prices for their holidays. This helps in identification of tax burden and other additional expenses.
  • Brochure: It is a document that involves all information related to different holidays which were offered by Trailfinders to their customers. Development of Brochure is essential for creating awareness about tour and prices among people (Medlik, 2016). Design should be effective so that it attracts customers and should also provide basic information of tourist destinations.
  • Advertisement: At this stage, company needs to select an appropriate method of advertisement that covers less cost and helps in providing information about holiday package to large population (Guo and He, 2012). For example: social media applications, direct mails, company websites, brochure, templates and digital advertisement are most effective channels of advertisement that needs to be applied by organisation for development of tour packages.
  • Operations and implementation: This step mainly includes steps like deposits, booking of tickets and development of checklist. This stage deals with practical applications of actions for planning of tour.
  • Post tour Management: This stage involves evaluation of performance after implementation of tour package. In this, Trailfinders will take feedback from individual associated with the tour in order to create change in next tour package (Jones and Robinson, 2012). Through this, managers will tend to identify problem faces by customers and they also find ways to resolve those issues.

1.2 Suitability of different methods of contracting for different components of holidays.

In law terms, contracts are analysed as agreements that needs to be signed by two parties when they agree on the terms and condition of contract. In terms of tourism industry, contract relationship exists between tour operators, tourists and service providers which is essential to resolve disputes. There are various kinds of contracts that needs to signed by associated parties to protect themselves from nay kinds of legal issue related to travel and tourism.

Fixed contracts: In these kinds of contract, organisation focus upon the collective as well as quantitative approach for selling tour packages (Kerzner and Kerzner, 2017). Tour operators increase their capacity through maximizing sales volume. This kinds contract is done to take benefits to season in which they have fewer demands. In this, Trailfinders will create fixed contract with the customers and service providers to increase cost effectiveness and getting more discount. Further, it is less effective because trailfinders also needs to pay amount in case of non utilization of services. For example: When the Trailfinders have booked 50 seats for their clients but only 45 seats were occupied then company also needs to pay the amount of extra seats.

Sale only contract: These are analysed as seasonal contracts which are made by considering the demands of holidays packages among customers (Witt, Brooke and Buckley, 2013). In sale only contracts, Trailfinders needs to pay the price for only those services which are used by their customers. It is essential at the time of over booking and company will get support in purchasing additional services. There is no scope of discounts in these kinds of contracts.

Ad-hoc contracts: This type of contracts also deals with overbooking and company is required to make extra booking of seats or accommodation (B. DiPietro, Cao and Partlow, 2013). These kinds of contracts are mainly signed by specialised tour operators.

Different types of tour operators

There are various kinds tour operators that exists in tour operations industry and responsible towards development of holiday packages.

Inbound: These are the organisation that provide travel and tourism service for people in home countries and these are considered as in bound tour operators. For example: organisation like Thomas cook and England tours are analysed as In bound tour operators.

Outbound: Travel companies having business operations in different nations developes tour packages for different people living in different nations. These tour operators generally have their business operations at international level (Grant, Wong and Trautrims, 2017). Trailfinders limit is also outbound travel company which has 29 branches in different countries.

Domestic: it mainly involves those tour operators which are responsible for formulation of tour packages for the clients of home countries (Naji-Azimi and et.al., 2012). They also have different branches in different city of home country. For example: Thomas cook and TUI group are two major domestic tour operators which has their various branches in UK.

Specialist: These organisations are specialised for creation for the development of some specific and unique kinds of holiday package. For instance : tour package which are developed by Trailfinders for their customers different parts of world. For example: HF holidays and Trail finders are specialist tour operators.

1.3 Selling price of holiday package.

Expense Type

Cost (in Pound)

Cost of Hotel

120

Cost of accommodation

2000

Cost of Luxury Coach

7,400

Cost of local tour guide

920

Total

10440

30 percent profit margin

3132

Working notes

1.15 Euro=1 Pound

90/1.5*1= 60

60 Euros= 1 Pound

Cost of room (2 adults sharing) 60* 1= 60 Euros

Number of rooms required 40/2 = 20

Cost of hotel =20 rooms for one night = 60*20= 120 pounds

Cost of 5 nights= 120*5 = 600 Pounds

BB for 1 = 10*1 = 10

Cost 40 people on 5 nights = 40*5* 10= 2000

Cost of 45-seater luxury coach is £7,400 including road, ferry and taxes

Cost of a local tour guide is €920

Total cost for package: 10440+3132= 13572

Cost for an individual: 13572 /40 =339

TASK 2

2.1 Planning decisions taken for design of selected brochure.

There are various important planning decision that needs to be taken by Trailfinders Ltd in planning and demonstration of effective business decisions. Brochure is analysed as documents that contains all the information about the tour packages which are developed by organisation. These activities are clearly classified in tour packages of operators. This is also analysed as method of techniques for the market that involves the low cost. Company will also distribute their brochures from both online and offline methods (Hoffman, Padberg and Rinaldi, 2013). Digitalization methods and improved technologies also provide support to organisation in increasing the reach of brochure.

Design: It is the most important decision that needs to taken by managers of Trailfinders to attract customers. Moreover, selection of appropriate design is important to attract clients. Large scale companies hire advertisement agencies for development of brochure. Organisation also needs to take decisions about things that needs to be included in brochure.

Cost: The major aspect that needs to be consider is the cost of operators. Decision related to budget of developing brochures needs to be taken by managers. Cost of development involve printing charges, designing charge, paper charge and distribute expenses etc.

Format: It implies to decision related to font, size, shape and colour that needs to be taken by organisation while planning for development of brochure (Sigala, 2014). Appropriate design and colour needs to be selected so that it may attract people and attractive picture of tourist destination must be used in brochure which clearly provide information about different locations.

Target Market Decision related to target market also needs top be taken by management while creation of Broshure. In this, trail finders have target local and medium class customers who desire to buy these tour packages.

2.2 Suitability of alternatives to traditional brochure for different types tour operators.

With the advancement of technology, there are various kinds of brochure have been used by organization to provide information and attracting customers. Many new methods of advertisements and communication have been used by introduced to replace the brochures. Some of them are mentioned above:

  • Press: It implies to print media such as Newspaper, magazines and templates which are mostly used by tour operators to promote their tour packages (Al-Odeh and Smallwood, 2012). It is traditional method of developing Brochure which is used by tour operators.
  • E Brochures: These are considered as electronic brochure which are available online and used by tour operators to make their communication more effective. It is effective as it involves less time and efforts for distribution. Utilization of internet is identified as common in present scenario and people are more attracted towards E brochures.
  • Social media: It is identified as inexpensive method used for promotion of tour packages which has replaced the traditional brochure technique (Wang, 2012). Through this brochure, Trail finders will be able to attract new and retain their old customers without any charges. They can also stay connected with large number of population and provide them information about new services.
  • Leaflets: Trailfinders also use this method which is a single page advertisement which is formulated at last minute to deliver the brief information of products and services to limited audience.
  • Business events: Various business events have been organised by large scale companies for their employees and stakeholder. Trailfinders can also promote their holiday packages in those events and also make sponsorship in these business events. Through this, company will be able attract to business class customers.
  • Outdoor media: It implies to advertisement which is given by tour operators on out door media such as buses, Walls and public notice boards etc. this method helps Trailfinders to create awareness about products and service among its target customers.
  • Mobile applications: Various applications have been developed by organisation to promote their business in market. Trailfinders can also develop their own business applications to attract customers from different countries.

However, the most suitable media for Trailfinder Ltd. It is analysed as E brochures because it is easily available online and it can be transferred to people through direct mails and companies websites etc. It contains less cost and efforts as compared to print media.

2.3 Suitability of different methods of distribution used to sell a holiday package.

Company operating in tourism industry needs to adopt effective ways for distribution of information and products. Distribution is identified as important ways of movemenet of products from seller to buyer which can be direct or indirect (Pohl, 2014). Moreover, direct distribution method allow the organisation to make direct contact with their customers while indirect method include mediators who are connected with company and sell their product in market. In this context, both direct and indirect method of distribution is use by Trail Finders Lt.d which are mentioned Above:

Direct channels: It implies to direct selling of product without any intervention of intermediaries. This is effective for trail finders and provide support in making influence on customers to purchase products and services (Gibson, 2012).

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Indirect channels: it involves intermediaries who have relationship with organisation and responsible for selling of their products and service to customers. It is costly method because organisation also needs to bear the cost intermediaries.

Methods of distribution used by different tour operators which are as follows:

  • Online travel agencies: These are types of service that may or may not be present. These agencies have their own websites and call centres through which they communicate with clients and sell holidays packages of Trail finders (Camilleri, 2014). They also direct booking facilities to customers and online payments methods. It tends to reduce efforts of customers and provide various choice which can be selected by customers.
  • Government Websites: In UK, government also provides an platform to travel and tourism companies for promotion and distribution of information through government websites (Medlik, S. ed., 2016). These websites are mainly for local tour operators who deals with native tourists.
  • Visitors information centres: At these centres, tour operators are allowed to put their leaflets and flyers. Tourist can approach these centres and find best tour packages for them.

TASK 3

3.1 Strategic decision made by different types of tour operator.

Tour operators industry are very much focused on development of tours packages through which they can attract more people towards their organisation. Continuous changing scenario of tour operators industry has also provided influence tour operators to make strategic decision through which they will be able to attract more customers and sustain their business operators in competitive business environment (Guo and He, 2012). In this context, there are various important strategic decision which are taken by different tour operators in country which are mentioned below:

  • STP analysis: In order to sell every tour packages, analysis of selected customers is important decision which is taken by tor operators along with the positioning of products and services which has been provided by them in such as way that it promotes tour operations of enterprise. Selection and targeting of potential will enable Trailfinders to sell their products effectively (Grant, Wong and Trautrims, 2017). Through this, company can directly adopt their effective methods for promotion of products and services in market. Along with this, positioning strategic is also important decision which implies selection of market in which the company tends to position their business. It depends upon the selection of prices and service. Trailfinders has adopted low prices for their services as compared to customers and tends to position their business at national level. They have also adopted this strategy because it helps them in expansion of customers base and business operations in different countries.
  • Seasonal strategy: It implies strategic decision which are formulated and implemented by tourism companies for regulations of their business operations in different seasons. Trail finders also develop tour packages for different seasons and prices are also charged as per demand of products and service. In Festive seasons, high pricing are charged by Trailfinders on booking of holiday packages. Various decision related to services and activities which are provided to customers will be taken by Trailfinders.
  • Competitive pricing: It is also analysed strategic which needs to be taken by company to increase their customers and promote business operations. Development of competitive pricing policies involves the selection of appropriate prices for products and service after analysing the prices which are charged by competitors in market for similar products and services. In this context, Trailfinders needs to analyse pricing policies and services which are offered by its competitors to identify method which needs to be applied for selection of appropriate holidays package.
  • Promote innovation: Decision related to continuous innovation of products and service are also needs to be taken by management which provide support in development of tour packages. Market research is most important tool which provide understanding to Trailfinders that needs to be made in products and service by organization attract consumers. Continuous innovation in products and services also provide support increas

3.2 Tactical decisions that could be taken by selected tour operator in different situation.

Tactical decision are helpful for the business unit in smooth functioning of the business unit. It allows the firm in managing operations well and avoiding errors. Correct decision are helpful for the business unit in order to raise profit and enhancing satisfaction level of consumers (Sotiriadis, 2015). There are many external factors that impact on the business unit to great extent. For example if government makes changes in the regulations then it would be difficult for the business unit to carry out the operations in smooth manner. In such condition it has to modify its practices so that it can run its firm legally. In such condition Trailfinders has to develop healthy relationship with employees.

This will support in making changes in operations. Trailfinders is the international operator, it provides travel facilities to travellers globally. But due to fluctuation in currency exchange rate entity has to face many difficulties (Redjem and Marcon, 2016). In such situation cited firm has to make tactical decision so that fluctuation do not affect revenues of the firm. Company has to conduct market research and have to clearly communicate information with consumers regarding the fluctuation in the currency rates. So that if price gets changed then they do not cancel their trip. Furthermore, if there is inflation then people will not plan for travelling to other nation. In such condition entity has to make tactical decision of implementing effective pricing strategy (Camilleri, 2014.). If Trailfinders provides facility to the consumers at fair prices then consumers will take interest and they will buy its services. Most of the people cancel their plan to travel because of high prices. But if entity adopt effective pricing strategy then it would beneficial for the organization in attracting more buyers and dealing with complicated situation well. By this way organization can success in the market and can sustain for longer duration.

CONCLUSION

In this report, it is been concluded that there are various important trends and development have been occurred which has provided both positive and negative impact on tour operations industry. Implementation of information and communication technology by tour operators in identified as important for success of Trailfinders Ltd. Tour operations industry has also achieved growth with increase in demand and supply of product or services. Analysis of strategic decision provides clear understanding that company needs to adopt competitive pricing policies to raise its customers. Planning of brochure involves decision related to design, format and cost needs to be taken by management for promotion of products and services.

REFERENCES

  • Al-Odeh, M. and Smallwood, J., 2012. Sustainable supply chain management: Literature review, trends, and framework. International Journal of Computational Engineering & Management. 15(1). pp.85-90.
  • DiPietro, R., Cao, Y. and Partlow, C., 2013. Green practices in upscale foodservice operations: customer perceptions and purchase intentions. International Journal of Contemporary Hospitality Management. 25(5). pp.779-796.
  • Camilleri, M., 2014. Advancing the sustainable tourism agenda through strategic CSR perspectives. Tourism Planning & Development. 11(1). pp.42-56.
    Gursoy, D., Saayman, M. and Sotiriadis, M. D., 2015. Collaboration in tourism businesses and destinations: A handbook. Emerald Group Publishing.
  • Evans, N., Stonehouse, G. and Campbell, D., 2012. Strategic management for travel and tourism. Taylor & Francis.
  • Gibson, P., 2012. Cruise operations management: Hospitality perspectives. Routledge.
  • Grant, D.B., Wong, C.Y. and Trautrims, A., 2017. Sustainable logistics and supply chain management: principles and practices for sustainable operations and management. Kogan Page Publishers.
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