UNIT 6: Sales and Administration Procedures

1.0 INTRODUCTION

Sales is a very important part of marketing the goods and services any organization
has to offer. This unit will look at the selling skills and administrative procedures.
First of all, it is imperative to know the difference between sales and marketing. Sales
focuses on the products or services for sale, while marketing focuses on the guests.
Although a sale is different from marketing, the two go hand in hand. In the
hospitality and tourism industry, the sales department is responsible for making sales
to guests that are the target market. Each organization organises its sales department in
a way it can suit it best and that is the reason some organizations have sales offices
throughout the nation and in other countries, in addition to the internal sales
department. The sales department uses advertisements like billboards, newspapers,
magazines and the electronic machines (i.e. radio and television).

Another way to reach customers or guests is through sales promotion such as

community projects like identification of selected parks and gardens. Corporate sales
programmes usually have ties with oil companies, credit cards, car rental companies
and travel agents. Brochures for selling group meetings and tour groups at special
rates are given to companies.

There cannot be a successful selling, without a sales programme and there cannot be a
sales programme without an assigned responsibility for supervising and conducting all
phases. In general, the sales plan should be directed at pulling up business in the low
spots. Sales tools, i.e. direct-mail, display advertising, personal selling and publicity
should be applied at the same time to achieve a definite goal. Sales men very familiar
with the product are expected as part of their duties to call on travel agents, corporate
offices and other potential clients.

2.0 OBJECTIVES

After the end of this unit you should be able to:

1) know the relationship of sales, advertisement and marketing and their importance,
to the hospitality and tourism industry.
2) describe the different approach tools for successful sales.
3) understand various means of advertisements and public relations that make a
hospitality and tourism organization sell.

1
3.0 MAIN CONTENT

3.1 Sales, Advertisements, Marketing and the Administration of the

Hospitality and Tourism Organization

In the promotion of marketing and sale of any product, the principles are the same but
the hospitality and tourism sector has some peculiarities. The hospitality and tourism
product is a combination of products and services, and no single individual or
entrepreneur can produce it because each department in the industry needs a high
degree of speciality (Seth and Bhat, 2005, Pp 194-195). The hospitality and tourism
product is a peculiar product that cannot be transported or taken to the customer;
hence the customer has to get to it in order to make use of it. This product can not be
stored for sale at a later time, for example a hotel room has to be in use everyday or it
becomes a total waste unlike somebody selling stationeries who can store up any
stationery not bought for sale the next day. Also, in the case of natural calamities,
economic instability or political and ethno-religious upheaval, it affects the hospitality
and tourism industry.

Therefore, there is the need for an aggressive marketing in order to sell its products. In
order for tourism organization to sell its products, a good sales department usually
employs:- fact finding or data gathering (market research), communication to inform
the public tourist promotion), ensuring sales (distribution channels) and, coordination,
control and evaluation (Monitoring, the total marketing plan). To motivate members
of the sales team some organizations reward the sales teams with a little percentage
and this makes sales professionals to guard the clients carefully. (J. Walther 1999, P.
417).

Making a sale and influencing the guest to become a repeat guest is vital in today’s
competitive market place. About 80 percent of hotels and some restaurants business
come from about 20 percent of the guests that patronize because of sales
representatives. Another moral booster used by administrators of the hospitality and
tourism industry to gain the loyalty and dedication of duty by employees, especially
the sales team, is compensation. Compensation is the total reward benefit given to
staff that have met a particular target. Compensations can amount to 25 percent of the
total payroll, making them the highest single cost factor in the hospitality and tourism
industry.

3.1.1 Recruitment of Human Resources

As we have already known the hospitality and travel industry is the largest in the
world, employing some 70 million people. Also, there is no other industry in the
world that has a front line guest contact between employees and guests, especially
entry-level employees. In this industry, employment ranges from entry level-employee
to specialized positions, supervisory positions and managerial/executive positions.

2
 Human resource is all about attracting, selecting, orienting training, developing, and
evaluating the performance of organizations resources (Morrison, 1999, p.14). The
complexity of human resources management and development in the hospitality and
travel industry is increased because many unskilled workers are employed for entry
level. Positions. There is enormous and increasing cultural diversity within the
industry. Figure 6.1 illustrates the human resources management and development
process of the hospitality and travel industry.

Figure 6.1: Human Resources Management and Development Process

Task Analysis Job Productivity

Advertising Recruitment
Description Standards

Performance
Selection Orientation Training
appraisal

Development

3
Recruitment and selection is the process of looking for the most qualified and suitable
employee for the available position. The process starts with the announcement of
vacancies, which can start within the organization. Applications are received from a
variety of sources like from internal promotions, employee referrals, applicant files
transfers within the company, advertising, colleges and universities and also
government – sponsored employment services.

Application forms and curriculum vitae are accepted and screened by the human
resources department. A lot of organizations prefer the applicants to come to the
property and personally fill out the application form. The human resources department
then reviews the application and curriculum vitae for accuracy and also to be sure
rthat the perspective employee is legally entitled to work in the country. It is previous
employees only give the beginning and ending dates due to legal reasons. Figure 6.2;
show the description of the recruitment and selection process

Figure 6.2: The recruitment and Selection Process

Application
Form Initial
Testing
Submitted Interview

Selection/
Interviews References
Offer

Physical
Acceptance
Examination

4
Applicants are invited to come for an interview. This interview is a general screening
interview to determine that the applicant is suitable for employment in a general way.
During employment, employment managers look for dress sense, mannerisms,
attentiveness, attitude and interests. Questions are also asked which encourage the
applicant to answer in details. Interviews with the department head will assess the
candidate’s ability to do the job, while selection is selecting the most suitable qualified
candidate for the available position. Part of the selection process might involve tests
like personality, aptitude, skill or psychological tests to ensure that candidates possess
the requisites interpersonal skills to do the job.

3.2 Sales Tools, Sales Programmes and Sales Promotions

Sales as we have noted in our introduction is focused on the product or service to sell,
therefore a good hotel administration splits its sales team according to the various
target markets e.g. association, corporate, catering etc. Sometimes the classification
might have to involve regions in the area e.g. north, south, west, east, etc. some of the
approaches employed by the sales team are to ask companies about their
accommodations and restaurant needs and also to know which hotels and restaurants
they use at present. The team should be able to get the names of the people
responsible for booking hotels and restaurants so that they can be invited to the hotel
for a personal tour and lunch during the tour which is a great advantage (Walker P.
417).

Some sales tools and programmes include personal selling. Under this tool we have
sales calls, internal sales training for guards and contact employees’ telephone. The
second tool is the Direct Mail. Under this tool we have questionnaires, brochures, post
cards, envelope staffers and calendars. Display advertising; this third tool has
properties like news papers, roadside billboards and signs at airports and other
strategic places. Publicity is another tool which includes radio and television
advertisement messages and special events. Also, internal advertising as a tool
includes room directories, menu clips on, personal sales messages, records
announcement on the P. A. system (public announcement system). Yet another tool is
programme sponsorship on Tv and radio e.g. sports programmes (Coffman and
Recknaget, 2000, P. 184).

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3.3 Administration and Organizational Structure in the Hospitality and
Tourism Industry

The hospitality and tourism industry as we have noted previously is the largest
industry and also largest employer in the world – employing about 70 million people.
There is hardly any other industry that has the type of contact between employees and
guests such as this industry. In the hospitality and tourism industry employment
ranges from entry – level positions to specialized positions e.g. supervisory positions
and managerial/executive positions. This is why the industry revolves around Human
Resources Management. This point has been stressed by Troy (2003, Pp. 208). Human
resources is all about attracting, selecting, orienting, training, developing and
evaluating the performance of an organization’s most important resources, i.e. the
human resource.

No one hotel restaurant or tourism organization is the same with the other. The
difference is the service and professionalism. That is why human resources
management is so significantly critical to the success of the organization, J. Malker
2005. (Seth and Baith, 2005, p. 13). This is the reason why the industry has to be
divided into sectors and departments. There is the primary services (room, food,
beverage), ancillary services (guest laundry, valet service and other guest telephone),
support service (marketing/sales, property operations, maintenance/energy, general
administration and accounting). Below is an organizational chart of a typical hotel
organizational.

4.0 CONCLUSION

In conclusion we see how the nature of the hospitality and tourism industry and how
the marketing and sales of the industry are quite different from those of other
industries. This is because of the nature of its services which as noted cannot be stored
like clothes or stationeries. For example, anytime a room is not in use, it is wasted.
There is urgent need to sell to prospective guests and tourists, that is why there is the
need to come up with an administrative section to cater for the needs of the sales. To
make these sales easier and more effective, some innovations have to be brought in
like sales tools, sales promotions and sales programmes.

5.0 SUMMARY

In summary we have learnt that the sales department is responsible for making sales to
guests that are the target market. Making a sale and influencing the guests to become
repeat guests is vital in today’s competitive market place. Since the profitability of a
hotel depends on the occupancy ratio in a hotel, innovative concepts have been
introduced to meet up with the growing competition. This also shows the reason why

51
there is a full organizational and administrative ladder to deal with each department
professionally in order to keep up the standard.

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6.0 Tutor-Marked Assignment

1. Discuss the essential principles of good advertising

2. Differentiate between marketing and sales, and their impact on the hospitality and
tourism industry.

7.0 References/Further Readings

Coffman, D. C. and Recknage, J. H. (2000) ed. Ithaca, New York: Cornell University
Press.
Seth, P. N. and Bhat, S. S. (2005). An introduction to Travel and Tourism. New Delhi:
Sterling Publishers Limited.
Walker, J. R. (1999); Introduction to Hospitality, upper saddle River, New Jersey:
Prentice Hall
Troy, T. N. (2003) “Hospitality Association Waging War in Minnesota”, Hotel and
Motel Management, 208, 15, September, 6, 2003.

53
TSM 348: HOSPITALITY AND TRAVEL MANAGEMENT

UNIT 7: Domestic and International Fares and Ticketing

1.0 INTRODUCTION

The travel industry is a very big industry and that makes its activities complex. In
order to ease these complexities, it came up with different sectors, agencies and
associations to assist the industry in carrying out some of the complicated duties. The
International Air Transport Association (IATA) is one of those agencies that assists
the travel organizations IATA with its headquarters in Montreal, Canada was
established in 1945 and most scheduled airlines are members of IATA. IATA governs
only international fares, while domestic fares are governed by the domestic airlines or
the government of the respective domestic entity or nation. The function of IATA is to
make the movement of people and goods through a network of routes as easy as
possible. IATA is also responsible for regulating and standardizing tickets and
stabilizing fares and rates.

The world schedule air transportation industry was grown from a mere a million
passengers in 1945 to about 1.5 billion passengers in 2001 and currently more than 3
percent increase and about 40 percent of manufactured goods in the world are
transported by air. All this is attributed to the fact that the average consumer of
scheduled airline products are paying 70 percent less than what he or she was paying
twenty years ago. The International Air Transport Association has made all this
possible by making airlines to be deregulated which has benefited most of them.

2.0 OBJECTIVES

At the end of this unit, you should be able to:

Discuss domestic and international flight fares and list and explain the roles of
domestic and international regulatory organizations.

Explain the use and importance of ticketing.

54
3.0 MAIN CONTENT

3.1 Domestic and International Flight Fares

Fares in the travel industry vary in different ways and for different reasons. Reasons
can range from the mode of transportation, or the distance between the origin and the
destination. Just like in most organizations there is usually a body responsible for
regulating and monitoring prices and fares as is the case with the travel industry.
Without these modalities in place for price regulation and monitoring there will likely
be exploitation by some travel organizations. In the case of the aviation industry, the
body responsible for this is the International Air Transport Association (IATA) (visit
www.iata.org).

Fares are also determined by the density of traffic demand in an area. An example is a
trip from Europe to America which will be cheaper than a trip from London to India.
This is because the density on London, India route is lower than that of London – New
York. The same is true of the domestic route. For example, one cannot compare the
density of Kano-Lagos route which is definitely higher than the density on Sokoto –
Lagos route. Other factors are the capacity available on certain routes, the level of
competition on the sector and cost of operations. (Fairlier, 2003, P.7).

Fares especially on international travels when paid will only become applicable when
the journey commences at the point of origin shown on the ticket. If a travel actually
commences at a different location or country, the fare must be re-assessed from such
location or country. Promotional fares are the way airlines offer cheaper fares to
attract more passengers. Most important among these fares are; the excursion fares,
which fares are for people spending a week or fourteen days in order to stop business
people from looking for cheaper ways to travel. The group fares is the second type of
fare, which are applicable to groups; it is applicable to a minimum of a group of ten to
forty people traveling together.

3.2 Ticketing

A ticket is obtained when a traveller pays the stipulated fare. When the fare is paid
through cash or credit card, automatically a ticket has been bought. The ticket is like a
receipt but more detailed and contains all the information needed by any check-in staff
of any airline. Normal ticket regulations apply to documents issued against credit
cards or cash. The validity of the ticket lies in the ticket and not by the date on the
credit card.

As innovations continue getting introduced into the industry, so also is a multipurpose

ticketing system. This ticketing system is known as the automated Ticket Boarding
Pass (ATB). So far the ATB has been introduced by a number of carriers and airlines.
This ticket is a combined document serving a passenger ticket and baggage check,

55
boarding pass and also a baggage identification tag. The automated ticket Boarding
Pass (ATB) also contains information like, the name of the origin and name of the
destination, issuing name/vacation and place of issue, carriers information (ticketing
system provider) and flight information (flight coupon and boarding pass). The ATB
also contains about thirty to thirty five more detailed pieces of information. For a
better understanding, a specimen of an Automated Ticket and Boarding Pass (ATB)
are shown below.

3.3 Domestic and International Regulatory Organizations

Tourism is to some extent an international ambassador, bringing goodwill and

intercultural understanding among people of the world. Because it deals with travels
across international boundaries the government inevitably is involved in tourism
decisions and also has to regulate the entrance and exit of foreign materials. For this
reason, organizations are formed that will check the hospitality and travel industry.

The organization that represents all national and official tourism interests among its
allied members, is the World Tourism Organization (WTO). It is the most widely
recognized organization in tourism. There is also the International Civil Aviation
Organization (ICAO), which comprises of more than eighty governments. This
international organization coordinates the development of all aspects of civil aviation
with regards to international standards and practices. International Air Transport
Association (IATA) regulates and standardizes tickets, way bills and baggage checks.
It coordinates handling and accounting to allow quick interline bookings and
connections. In addition, the IATA also maintains the stability of fares and rates.

There is also the International Civil Aviation Organization, Domestic Organizations

that regulate for the common interest and concerns of all components in a country or
region which have the same attribute and sometimes affiliated to the international
bodies.

4.0 CONCLUSION

The travel industry is very complex and has evolved at a tremendous pace that it needs
different bodies and organizations to operate efficiently. The travel industry deals with
people from all over the world especially with the invention of the airplane because

56
the safety of passengers and their interest is uppermost, some organizations were
formed at both international and domestic levels to check and surprise the travel
industry. One of such is the International Air Transport Association (IATA).

5.0 SUMMARY
Domestic and international fare and ticketing are some of the innovations brought
about by the evolution of the travel industry. The industry has grown so large that
modalities are put in place to protect the rights, lives and properties of the travelers
and also to save the travelers’ time. These modalities include formation of bodies and
organizations to check the activities of the airline operators.

6.0 Tutor-Marked Assignment

1. Explain the term ticketing
2. What are regulatory organizations and their role?

7.0 References/Further Readings

Fairlie, R. (2003) “Dividing the pies” Travel weekly November 8, 2003, P. 7.

International Air Transport Association, www.iata .org.

International Civil Aviation Organization, www.icao.org

57
TSM 348: HOSPITALITY AND TRAVEL MANAGEMENT

UNIT 8: Computer Reservation Systems

1.0 INTRODUCTION

Some decades ago it can be recalled that airlines check in staff operated at airports
with large sheets of papers, matching details of each passenger manually. This usually
took a long time and queues got even longer. But in modern times, it takes just a
minute to get clearance from a check-in-staff. Once the staff collects a passengers
ticket, all the passengers data needed will appear on a screen and a pass is issued by
the same computing machine instantly. This process also gives out information on seat
numbers and exit gates from where a commuter can board the plane. This brought
about the invention of the Computer Reserve Systems (CRSs) which is the most
important marketing tool of airlines. Computer reserve systems are systems for
information; they store current information about all travel providers. These systems
also perform tasks that are related to service distribution.

The computer reservation systems do have the details of all flights, and details of
millions of passengers are also stored in machines. Although some airlines had started
using computers in the 1950s, it was still hectic because each airline had its own
computer and therefore if one airline was making a reservation of a sector on a
different airline, the two computers could not communicate with each other and they
would send teletype messages. It was in the 1970s that travel agents and airline saw
the need for a computer reservation, that could show the flight availability of most of
the airlines and portable enough to be kept on a table where reservations could be
made and tickets printed.

2.0 OBJECTIVES

After the end of this unit you should:

discuss the importance of the computer reservation system in the hospitality
and tourism industry
explain the dimensions of communication for the hospitality and tourism
industry.
describe the specific reservations system

58
3.0 MAIN CONTENT

3.1 The Importance of the Computer Reservation System in the Hospitality

and Tourism Industry

The Computer Reservation System is fundamental in the growth and survival of the
hospitality and tourism industry. In fact any successful organization in this industry must
have to attribute its success to the Computer Reservation Systems. As we all know
tourists travel from their homes to destinations and in modern times, the aeroplane has
been among the preferred traveling means by tourists. In the past before the invention of
the C.R.S., Passengers and Tourists had to queue up for a long time for manual matching
of details of each passenger with his or her ticket, but today all these are achieved in just
a minute, making travelling faster and more efficient. Travel has expanded all over the
world. Many times over one can imagine what it would be like for tourists without the
Computer Reservation Systems (see for example, Kasavana and Brooks, 1991, Pp. 114 –
5).

The same Computer Reservation Systems have access to data on hotels, car rentals,
trains, cruises, climate, currencies, etc. Apart from reservations the computer can
make changes in reservations with just a touch of button. Now many hotel chains have
a number that a prospective guest can call to make reservations at any of the
company’s properties. The corporate computer Reservations System allows operators
to access the inventory of the availability of rooms in each hotel and once a
reservation has been made, it is immediately cancelled from the inventory of rooms
throughout the duration of the guest’s stay. The Central Reservations System has been
- important in saving time and cost for airlines, hotels, travel agents and tourists. Now,
one can just relax at home or in the office to make multiple reservations (flight and
hotel room) at the same time. This has also reduced unnecessary overcrowding at
reception desks, hotels and airports.

3.2 The Dimensions of Communications for the Hospitality and Tourism

Industry

The internet has added a new dimension to the hospitality and tourism industry. The
system has made communications in the industry system very easy and with very little
stress. With a computer unit in the office or at home and with access to the internet
one can click to a website where airline tickets, holiday resorts and hotel reservations
are on sale and thereby buy whatever one wants to buy just by giving one’s credit card
details. The website of Jupiter Communications (www.//jup.com) has done a study on
the proliferation of travel related sites in the internet and is illustrated below:

59
 Figure 2.4: Proliferation of travel related sites worldwide

Consumer

Travel Agent

National Tourism GDS/CRS

Organization
Four Operators

IT and the
Incoming
Regional Tourism Internet Switch
Agent
Organization

Group/
Consortium CRS
Aarect/Local
DMO

Accommodation
At destination AIR/Rail/Bus+Car HIRE

Source: World Tourism Organization, 2005

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This website has estimated that online revenue for 2002 alone was about US$8.9
billion. In the US, back in the late 1990s some sixty four million people were reported
to have access to the Internet, but still matters are made easier with millions of
websites of travel retailers, whole sellers and the consolidators as well as national
tourist offices (Eddystone, 2001, Pp. 15-16, Godwin, 1999, P. 56). The hospitality and
tourism industry is next only to airlines in the use of technology and has been
enjoying the best of both worlds. From computerized check-in to automatic wake up
calls, electronic locks to closed circuit T.V. fire security protection systems and
teleconferencing, nothing is better organized than the modern day hotel.

3.2.1 Property and Reservation Management Systems

Property Management systems (PMSs) have greatly enhanced a hotels ability to

accept, store and retrieve guest reservations, guest history, requests and billing
arrangements. Property management system also provides reservations associates with
information on types of room available, features, views and room rates. A list of
expected arrivals can be easily generated from such a system before the advent of the
PMSs, it took reservation associates much longer time to learn about the features of
each room and the various room rates. A property management system contains a set
of software packages that are capable of supporting a variety of activities in both the
front office and the back office areas. Among the most common front office software
packages that are designed to assist front office workers in performing their functions
efficiently are Reservations Management, Rooms management, guest account
management and General Management.

The Reservations department software allows the room reservations department to

quickly accept reservations and generate confirmations and occupancy forecasts for
reservations, that are being handled by the hotel directly and by the Computer
Reservation Systems(CRSs). Most hotel chain operating or affiliated to hotels have a
phone number that has the last digit reading from 1 – 500. This is to allow guests to
call at any time without obstruction and in some cases without charges. Travel agents
also have direct access to the central reservation numbers. The various software
packages contains information of the following; Reservations, front office, group
billing, guest history report writer, travel agent, billing, tour operations, housekeeping,
yield management, package plans, wholesaler blocks, call accounting interface, point-
of-scale of interface, and environmental control. Others include central reservation,
general ledger, and accounts payable, condo owner accounting associate management,
long-term rentals and timeshare rentals.

The Holiday Inn worldwide for instance, has invested more than $60 million for the
installation of PMSs in all its properties. This system integrates revenue optimization
and customer tracking software to maximize income for the properties and options for
the guests. Some of the advantages of the Holiday Inn Reservation Optimization
(HIRO) and ENCORE are that they include a two-way interface with Holidex (i.e. the

61
Holiday Corporation’s Reservation System) that automate and make front desk tasks
and procedures simpler and easier. The HIRO system is believed to be the first
automated length-of-stay optimization system to be integrated with a central
reservation system.

3.3 The Types of Reservation System

The Hotel Industry Switch Company (THISCO) has a link between the hospitality
industry’s central reservation systems and those of the airlines. This allows travel
agents access to hotel data base. Among the modern and sophisticated computer
reservation systems are SABRE and APOLLO, which are the two main airline
computer systems. SABRE is owned by American airlines and APOLLO is jointly
owned by United, USAIR, and several European airlines. The two computer systems
have developed sophisticated global reservation systems to make it easy for the travel
agents to arrange international hotel reservations.

SABRE is one of the largest privately owned computer networks in the world. Its
hardware headquarters is situated in Tulsa, USA. The building where the hardware is
located is specially designed to withstand terrorists and criminal attacks and safe from
natural disasters. The SABRE uses six of the largest International Business Machines
(IBM) computers which are connected by hundreds of thousand kilometres of network
data circuits to some hundreds of thousand terminals all over the world, (see also
Godwin (2001, P. 61). They also contain flight and fare data on over thirty five
thousand city pairs throughout the world for more than seven hundred airlines. The
SABRE can be used to book rooms in over thirty thousand hotel properties and rental
cars from car rental companies. It also contains details of over sixty five thousand
vacation and recreation activities. SABRE is more than thirty years old and it is a
hundred percent publicly traded company since March 2000 (Davidoff and Davidoff,
1999, P. 56).

The APOLLO, just like the SABRE, has developed sophisticated global reservation
systems, designed to make it easy for the travel agent to make international hotel
reservations. Colva is a typical example of a computer reservation system (CRS); it is
a subsidiary of Colva airlines system known to the American travel agents as
APOLLO and it enables agent book hotel reservations around the world. The
APOLLO is jointly owned by United, USAIR, Air Canada and several European
airlines and just like SABRE, the APOLLO has also developed sophisticated global
reservation systems designed to make it easy for the travel agent to make international
hotel reservations.

Another example of a leading type of Computer Reservation System is the

AMADEUS. It is a market leader in Europe, Africa, Asia-Pacific with a strong
presence in the USA and South America. It is believed to have a worldwide network
in sixty countries as a leading player. AMADEUS which was founded in 1987, is a

62
company with 60 percent of it capital held by Air French, Iberia of Spain and
Lufthansa of Germany. AMADEUS has its headquarters located in Madrid, Spain
with its data processing centre near Eding in Munich Germany. It has also a product
development facility at Sophia Antipolis. AMADEUS has three regional offices for
Asia Pacific (Bangkok), North Central America (Miami), south America (Buenos
Aires). The AMADEUS Global Network (AMANET) links providers and users and it
is the largest civilian data centre in Europe. The new technology that manifests itself
in the form of Computer Reservation Systems (CRCs), which was first developed by
the American airline was soon emulated by other US airlines.

4.0 CONCLUSION

The Computer Reservation System (CRS) has reached a high economical and
technological level. A level that travel agents and hoteliers including all stake holders
in the hospitality and tourism industry cowardly survive without its expertise. The
ultimate goal has been focused on hotels and airlines the two main pillars in the
hospitality and tourism industry to have access to global reservations network. This
user friendly software system makes it easier for travel agents to make hotel
reservations in four easy steps; stop, look, check, and book.

5.0 SUMMARY

The internet automation and the global reserve system also known as the computer
reservations system has changed the travel, hospitality and tourism industry in less
than three decades. Major hotel chains and leading hotels have developed their own
reservation systems and have made excellent use of the new technology. Also
National Tourist Administrations have been caught up in the technology bug and are
now promoting their destinations on multimedia websites.

6.0 Tutor Marked Assignment

1. Trace the evolution of the various computer reservation systems and their relevance
to the hospitality and tourism industry.
2. How do airlines benefit from the computer reservation systems?

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7.0 References/Further Readings

Davidoff, P. and Davidoff, D. S. (1999), Sales and marketing for travel and tourism,
Alban, Delmor. Blackhill Inc.
Eddystone, C. N. (2001), Managing Hotels effectively; Lessons from outstanding
General Managers, New York: Van Nostrand Reinhold.
Godwin, N. (2001) Complete Guide to Travel Agency Automation, Alban, Delmar:
Blackhill Inc.
Jupiter Communications www.jup.com
Kasavana, M. L. and Brooks, R. M. (1991). Managing Front Office operations. East
Lansing, Michigan, The Educational Institute of the American Hotel and Motel
Institute.

64
TSM 348: HOSPITALITY AND TRAVEL MANAGEMENT

UNIT 9: The Role of Travel Agents and Tour Operations

1.0 INTRODUCTION

The hospitality and tourism industry just like any industry or organization has to
promote, i.e. advertise the industry to prospective customers. For any industry to
progress there has to be a form of awareness to the prospective customers. The
customer has to know what he is being offered and what he has to expect or what are
his gains and advantages of his patronage.

Over the course of time, the motivation for most travels has been related to religion,
conventions, economic gains, war, escape, migration but would seem that the only
motive left is travel for pleasure. Obviously, travellers select destinations for different
reasons: These reasons include climate, history, culture, sports, shipping, facilities etc.
For these diverse reasons, there has to be a way of selling this destinations to
prospective travellers and a promotion of the mode of transportation and the
destination. The advantages of using travel agents and travel operators is that they
represent a number of air lines making it possible for clients to make choices. Travel
agents are in a better position to advice clients on alternative air services. If the
desired one is over booked, travel agents and operations supply their costumers with
information about flight operation and timings. They give information about
destinations, cost of airline fares, hotel rates weather and business opportunity
conditions.

2.0 OBJECTIVES

After reading this unit one should be able to:

understand the responsibility of a corporate travel manager
know the functions of travel agencies and tour operators
discuss the importance of Destination Management Companies (DMCs) to the
promotion of the hospitality and tourism industry.

3.0 MAIN CONTENT

3.1 Travel agents/Agencies

A travel agent can be seen as a middle man that acts as a travel councilor. He/she is
responsible for selling on behalf of airlines, cruise lines, rail and bus transportation,
hotels and auto rental companies. A travel agent can sell individual parts of the overall
system or several elements like air and cruise tickets. A travel agent is a broker that
brings together the client that is the buyer and the supplier who is the seller. A travel

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agent has quick access to schedules, fares, and advices clients about different tourist
destinations (Lundberg 1990, P.20).

A travel agent is more than a ticket seller. Other responsibilities of a travel agent
include:
arranging transportation by air, sea, rail, bus, or car rentals;
Arranging individual itineries, personal escorted tours, group tours and
personal package tours;
Arranging for hotel, motel, resort; accommodations which include meals
sightseeing, tours transfer of passengers and luggage between terminals and
hotels etc.
giving advice on many details involving travels such as insurance, travelers
checks, foreign currencies, exchange, immunization and documentary
requirements; and
arranging reservations for special activities tour operators organize, advertise
and promote and make these tours available for the sale to the general public by
combining air transportation with surface arrangements like road, rail hotels
and entertainment.

3.1.1 The Role of State Offices and the Hospitality Industry

Other organizations under travel agencies are state offices of tourism and city level
offices of tourism. The state offices of tourism are charged by their legislative bodies
with the orderly growth and development of tourism within the state. These agencies
promote information programmes, advertising, publicity and research relationship to
the recreation and tourism attractions in the state. Cities have also realized the
importance of the “new money” that tourism brings. Many cities have now established
Convention and Visitors Bureaus (CVBs) whose main function is to attract and retain
visitors to the cities attractions, restaurants, hostels and motels and also transportation.
These bureaus are largely funded by the Transient Occupancy Tax (TOT) that is
charged to hotel guests. In most cities, the Transient Occupancy Tax ranges from 8
percent to 18 percent.

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3.2 The Corporate Travel Manager

A corporate travel manager is an entrepreneur working within the frame work of a

large organization. A corporate travel manager is employed by a large corporation to
improve efficiency and reduce cost.

Tour wholesalers consolidate the services of airlines and other transportation carriers
and ground service suppliers into a tour. The tour is sold through a sale channel to the
public. Tour whole sale came into operation in the 1960s. The reason was due to
airlines inability to fully book their seats. Since vacant seats are perishable just like
hotel rooms, there was the need to sell as many seats as possible. When it was close to
departure dates, airlines would sell blocks of seats to wholesalers; these tickets were to
specific destinations around which a wholesaler built a tour. Three types of
wholesalers are the independent tour wholesalers, and airline working together with a
tour wholesaler and a retail travel agent who packages tours for his clients, see for
example, Tour Wholesaler Industry Study (1996, P. 68).

3.2.1 Modeling Travel Motivations

The satisfaction or dissatisfaction that a tourist experiences during a trip, depends on

how it is viewed by the traveler. A description of a glorious sunset and majestic
mountain for example, sound appealing to a lot of tourists, especially those on honey
moon. While it may be seen as a great bore if an individual is highly gregarious i.e a
person found of living in flock or fond of company, and is alone on the trip.

A traveller may love the rains while another despises it. Mountains are one person’s
delight, while heights make another person dizzy. The anthropologists marvel and
revels in a trip to a remote village or on an ecotourism trip of a safari while city
dwellers that enjoy having fun might find the same place dull. There is so much that
depend on what the person expects of the experience and how he or she actually
experiences it. These are some of the reasons why corporate travel managers are
important, because they (corporate travel managers) guide and advice travellers on
destinations to choose from.

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Corporate travel managers know that travel is an experience and not just a tangible
object, that is why it is important to guide a tourist on how, where and when to travel.
When travels are embarked on, they might create pleasant anticipation or aversion,
excitement and challenges, or fatigue and disappointment. The anticipation, the
experience and the memory occur in the mind, leaving no tangible evidence as to why
travel was undertaking and why the same trip is experienced in so many different
ways by different people. Travel literatures and films often falsify reality or are shot
and so selective that the actual environment is not recognizable by the visitor. For
example, phony shot can make a swimming pool look longer than it is or the colour
that never exists in nature - all these can create expectations that can not be realized,
and they lead to disappointment.

Destination managers have an interesting way of modeling travel to motivate the

traveller or tourist. An interesting way of modeling travel motivations is to divide
them into factors that pull and factor that push. The factors that pull attractions while
those that push are personal needs, Disney world in Miami Florida United States of
America, for instance, attract those motivated by a pull factor while a relaxing week
in an African Safari close to a beach such as it is obtained in Kenya and Tanzania is
inspired by a push factor. Still, yet much travel is likely motivated to some degree by
both push and pull factors.

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Figure 9:1: Psychocentric and Allocentric Types of Destinations (The Pull and the Push
Factors)

(Pull factor) (Push Factor)

Mid centrics
Near Psychocentric Near Allocentric

Psychocentric Allocentric

Atlantic City Miami Beach So. Pacific

Las Vegas Florida Japan
California Mexico Africa
Hawaii Thailand
Western Europe

Also Stanley Plog, a respected social scientist, has suggested that travellers can be
separated into extremes i.e (i) psychocentrics; those who prefer familiar travel
destinations (the pull factor) and (ii) allocentrics i.e those who prefer new different
destinations (the push factor). Most travellers fall between these two extremes. As
seen in Figure 9.2, psychocentrics i.e those under the pull factor travel to well-known
destinations that have been visited by millions before. These destinations tend to be
constant and predictable. While the allocentrics personalities i.e the push factors tend
to be more adventurous, curious, energetic and outgoing. They will usually be
attracted to novel destinations such as those found in pacific, Asia and Africa.

3.3 Destination Management Companies

A destination management company can be seen as a service organization within the

travel, hospitality and tourism industry that offers programmes and services to meet
the needs of its various clients. A destination management sales manager is
responsible for selling the destination to tourists, meeting planners, performance
improvement houses, i.e. incentive houses, and conventioners. The needs of these
tourists or a group of conventioners may be simply an airport pick-up or as complex
as an international sales convention with theme parties. Destination Management

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Companies, (DMCs) work closely with hotels. They book hotel rooms for their clients
and hotels also request destination management companies know how and expertise
on organizing theme parties. (Mill and Morrison, 1995, P. 85)

Destination Management Companies do everything for their clients. DMCs organize

airport receptions, transportation to hotels, VIP check-in, arrangement of convention
venues, organizing competition sports events and sponsoring any other programme
that deals with the needs of their clients. Sales managers associated with Destination
Management Companies use a number of sources to source for potential clients. The
sources include hotels, trade shows, incentive house and meeting planners. Every sales
manager of a destination Management Company works with a team to ensure
efficiency. This team usually consists of a special event manager, who takes care of
venue arrangements like sound, lighting and staging. The accounts manager assists the
manager in budgeting and controlling expenditure. The operational manager
supervises, oversees, coordinates everything on site in order to make sure events or
anything sold by the destination management companies becomes a success (Kaplan,
1995, P. 142).

4.0 CONCLUSION

The hospitality and tourism industry is an industry that attracts customers to come to
the industry to get the services they require. In order to bring these prospective
costumers, the hospitality and tourism industry needs a massive promotional
programme in order to remain in business. Sometimes the industry relies on travel
agents. A travel agent acts as a middle man between the airline/hotels and the
traveller. The travel agent sells tickets on behalf of airlines, makes arrangements for
hotels, motes and resort accommodations which include meals sightseeing, tours,
transfer of passengers and luggage between terminals and hotels. There are also
Destination Management Companies (DMCs). A Destination Management Company
is a service organization within the travel, hospitality and tourism industry. It is
responsible for selling the destinations to the tourists.

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5.0 SUMMARY

The hospitality and tourism industry needs very good promotion in order to create a
form of awareness to the prospective customers. Travellers select destinations for
different reasons and that is why promotion has to take place in order to sell. Travel
agents and destination management companies are used by the hospitality and tourism
industry to help in bringing in the prospective customers.

6.0 Tutor-marked assignment

1. Discuss the role of travel agents and tour operators in the hospitality and tourism
industry.
2. what are destination management companies (DMCs) and their functions?
3. list the three types of tour wholesalers.

7.0 References/Further Readings

Fairlie, R. (1996). “Dividing the pies”, Travel weekly, November 8, 1996, P. 1.

Kaplan, M. (1995); Leisure: Theory and Policy New York: John Wiley & Sons, Inc.

Lundberg, D. E. (1990) the Tourist Business, 6th ed. New York: Van Nostrand
Reinhold

Mill, R. C. and Morrison, A. M. (1995) The tourism System: An Introductory Text.

Englewood Cliffs, New Jersey; Prentice Hall.
Tour Wholesaler Industry Study, Tocuhe Ross & Co; 1996, P. 68 as cited in Mill and
Morrison, Op, cit., P. 400

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