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TRAVEL & TOURISM INDUSTRYSTRUCTURES

BTEC National

Travel & Tourism

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THE TRAVEL & TOURISM INDUSTRY

Travel and tourism is one of the worlds largestindustries.

It is also one of the most fragmented.

The two aspects of the industry can be viewed

separately, as many of the players are involved in

both

Lets look at each part of the industry on its own.

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TRAVEL INDUSTRY

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DISTRIBUTORS

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DISTRIBUTORS

The people, groups or firms that deliver the productsand services of travel to consumers.These include:

travel agents (business and leisure) travel operators selling direct to the consumer firms selling on the Internet call centres handling customer service

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REGULATORY BODIES

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REGULATORY BODIES

Organisations set up to oversee the industry,either:

Trade associations such as ABTA (Associationof British Travel Agents)

or

Statutory bodies such as the CAA (Civil

Aviation Authority)

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PUBLIC SECTOR ORGANISATIONS

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PUBLIC SECTOR ORGANISATIONS

Government departments with responsibilityfor the industry:

Department for Transport (DfT)

Department for Culture, Media & Sport(DCMS)

Foreign and Commonwealth Office (FCO)

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TRANSPORT

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TRANSPORT

Delivery of travel products

and services by:

Road

Air

Sea

Rail

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OTHER INDUSTRY PLAYERS

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OTHER INDUSTRY PLAYERS

Insurance firms and car hire companies:

Insurers provide cover for goods, services and people

Car hire providers meeting onward travel needs ofbusiness and leisure customers

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TOURISM INDUSTRY

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ACCOMMODATION, TOUR

OP

ERATORS & DISTRIBUTORS

Providing the nuts and bolts of the industry:

Hotels, villas, apartments, B&B, camping parks

Packages of travel tours to popular locations

Selling the travel product/service to individual and

business consumers

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TOUR OPERATORS

Four dominant firms

TUI (Thomson)

First Choice

MyTravel

Thomas Cook

All vertically integrated, operating at morethan one level in market

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TOUR DISTRIBUTORS

Usually includes business and leisure travel

agents:

Some large and well-known Some small and independent

Others in niche parts of market

Can you think of examples of each?

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TOURISM AGENCIES

Tourist boards and offices:

Promoting Britain to overseas customers (VisitBritain)

Promoting regions of the UK to overseas anddomestic customers (Visit Northumbria)

Providing information to customers (Tourist

Information Centres)

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PUBLIC SECTOR ORGANISATIONS

DCMS

Visit Britain

Regional Development Agencies

FCO

English Heritage

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OTHER INDUSTRY PLAYERS

The Tourism Alliance represents industry

views to the government

O

ther firms in industry, such as insurancecompanies and car hire firms

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FINANCIAL SYSTEMS IN TRAVEL

AND TOURISM

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As with any business, those organisations in thetravel and tourism industry need to manage their

finances in order to:

Receive payments

Make payments

Record financial activities

Keep systems secure

Handle currency conversions

Make tax returns

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EXCHANGE RATE MOVEMENTS

Tour operators and travel agencies have experienced the effects of

exchange rate movements in recent years in the following ways:

The fall in value of the US $ compared to UK

This has meant that a holiday or air ticket priced in US $ is less expensive

today than a year ago

If UK travellers want to visit the USA, they will have to use fewer UK s to

pay for a travel product or service thats priced in US $

The Activity associated with this lesson contains more for you to do on this

point

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POLITICAL CHANGES

Large-scale political changes also have an impact on travel

and tourism organisations financial systems:

Enlargement of the European Union in 2004 from 15 to 25members

Causes demand for travel to these new member states to rise

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POLITICAL CHANGES

Travel organisations may have targeted some of these new EU

destinations

For example, low-costs airlines have opened new routes to

cities in the new member states But changes to the tax systems in some of these new EU

states may have a negative impact on demand and supply of

travel products and services

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HR REQUIREMENTS FOR EMERGINGTRAVEL INDUSTRY

Specialized professionals in the fields of incoming, domestic and outgoingtourism.

Challenges on industry professionals: innovating traditional businessstructures, achieving higher quality standards and delivering solutions fordiversified product demands.

Crucial skills will be a strong and creative exposure to customer service, ahigh degree of destination knowledge, product innovation and organizationskills according to international standards. Travel professionals will have tobe able to realize and adjust to frequent new trends and changes more thananywhere else in the world.

The most critical professional profile in the tourism industry in the comingyears are related to business and sales development (direct, retail and

online).

As new niche markets are evolving (MICE, cruises, etc.), specialized travelprofessionals need to be qualified in time.

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SPECIFIC HR ISSUES IN TRAVELINDUSTRY 1 - RETENTION

Travel industry = Peoples business

Fierce competition for qualified travelprofessionals

Compensation, benefits & incentives

Perspectives for professional advancement andthe future of the company as a whole

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SPECIFIC HR ISSUES IN TRAVELINDUSTRY 2 - DEVELOPMENT

Commitment through monetary benefits as an essential prerequisite

Training (language, management & IT skills)

Improvements on destination knowledge:- familiarization trips within China and abroad- training in TUI DMCs overseas

Personal career planning

Partnerships with universities to affect the development of travel

professionals as early as possible

Team building

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TRAVEL & HOSPITALITY IS DEPENDENT ON THESE 4

FACTORS

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FLOW CHART OF BOOKINGS

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