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Heading: Travel Agents and Tour Operators
Subtitle: Theory
The Travel Agent and the Tour Operator
Tourists require a wide range of tourism-related services, ranging from assistance in
procuring a passport, visa, airline tickets, accommodation, information about the destinations and attractions, local transport, and other services. Tourism suppliers or the primary and secondary constituents of the tourism industry need to approach their potential customers and meet their needs effectively and efficiently. However, this task is not so simple because of the vast geographical distance between the suppliers and the consumers, as consumers are spread all over the globe. The task of the intermediary is to link the suppliers of tourism services to the consumers so that the demands of both the suppliers and the consumers are fulfilled. This link in the tourism system is the intermediary, i.e. the travel agent or tour operator, and it forms the primary means through which the tourism product is sold to the consumer or tourist. They form the channel of distribution or the place from where the tourism offerings are made available to the consumer. Their role is to bring the consumers or buyers and the suppliers or sellers together. Distribution plays an important link in the tourism system, linking tourism supply and demand. Tourism offerings have been traditionally distributed either directly or indirectly through the travel agents and the tour operators. However, recent technological developments have revolutionized the distribution channels and today consumers are dealing directly with the suppliers to get the best deals. We will read about the influence of information and communication technology later in Chapter 16. Travel agents; either working for a travel agency or individuals working on their own; assist their clients in planning their trips, planning the tour itineraries, making reservations for airlines, hotels, and other services. They act as intermediaries between the customers and the principal suppliers. They sell a variety of travel products and services and help their clients in turning their dreams into reality. The term 'travel agent was coined in the early years of the eighteenth century. Travel in the old days was very simple with no travel forays title that exist today. The different modes of transport available today were also not present in those times. People were more motivated to travel only after the transportation system such as railroads developed and organized travel came into picture. The rising income due to the industrialization and urbanization is another factor that has helped in the growth of organized travel.
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September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 The development of organized travel can be associated with Thomas Cook, the founder of Thomas Cook Group Limited, who was not only the first organized travel agent in the world but also the inventor of the travel and tourism business as it is today. Thomas Cook, as discussed in Chapter 2, persuaded a railway company to carry passengers at a very cheap fare, to attend a quarterly delegate meeting from Leicester to Loughborough in England. His idea was put into operation and around 570 travellers travelled by the Midland Counties Railway at a specially reduced fare. After this success, Thomas Cook organised excursions to various other places. In 1843, around 3000 school children were taken on a trip from Leicester to Derby in England, which was supposed to be the largest group of the time. Much has changed on the tourism scenario since Thomas Cook chartered a train at a reduced fare. The introduction of jet travel has given a boost to the business of travel agencies. The improved living standards and the improvements in technology and transportation system have also motivated people to travel. Earlier, the travel agents were mainly into arranging some forms of transport reservations for tourists. But today, they have to perform many functions. People are travelling in large numbers in both their own countries as well as to foreign destinations. This has resulted in the growth of travel agencies all over the world. Due to hectic life schedules, tourists today prefer to book their travel arrangements through a travel agent. The Travel Agent Travel agents act as intermediaries serving between the various service providers and travel consumers. They sell and may, at times, market the products and services provided by the suppliers such as hotels, transport operators, airlines, railways, cruise operators, tour operators, etc. The travel agents play an important role in the development and promotion of travel sales. They put together all the components of the tourism product and sell them to the tourist. The travel agent thus organizes the travel for the consumer. Travel agents are also referred to as travel consultants', 'travel counsellors', sometimes even 'tour operators'. Travel agents serve as a link between the travel suppliers and the tourists. Hence, a travel agency is like a r store, with a uniqueness; that it serves on behalf of both the supp and the consumers. For example, a client walks into a travel agency booking a tour. The travel agency after getting an initial booking am from the client will book the air tickets/rail tickets, arrange for a pick-up from the airport/railway station, make reservation at the hotel, b vehicle for sightseeing, etc. Thus, the travel agent has not only served the tourist but also given business to the airlines/railways, transport operator, hotel, etc. Each and every tourist does not have the time to book and arrange for the travel and the suppliers also cannot get in with every potential customer. That is why the services of a travel agent are considered important Benefits to suppliers Benefits to customers Financial: saves costs of setting up office and Convenience: All travel arrangements are employing sales personnel to deal with organized under one roof by an expert. Amount
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September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 customers. Travel agents collect their own of effort spent making bookings with different payments. suppliers is reduced. Retail outlets in different cities are not required. Provide expert knowledge: intermediaries have Minimizes risk: Intermediaries increase the through knowledge about tourism products/ number of distribution channels and reduce the destinations, travel formalities, etc. and can supplier’s risk of loss of revenue due to unsold advice customer accordingly. rooms, seats, etc. Saves money: tour operator get hotel rooms, Bulk purchasing by tour operators ensures airline seats, etc. at a discounted rate because minimum occupancy levels in hotels, number of they purchase in bulk and in advance. seats booked on a flight, etc. They offer packages at a cost lower that what the consumer would pay if he were to make all the arrangements on his own. Greater variety and choice, latest information and brochures on all products and services is available. Minimizes risks and uncertainties about quality product as intermediaries are well informed and can recommend good products.
A travel agency may be an individual, a business firm, Or company which acts as an
intermediary in the sales and promotion of different travel acts ad services, such as accommodation, airlines, railways, road transport, cruises, etc. and earns commission received on selling services to its clients A travel agency can also be referred to as a retail travel agency since it sells the various services offered by the travel suppliers directly to the customers. TYPES OF TRAVEL AGENCIES In the earlier days travel was mainly by sea and railways; tickets were sold directly at the offices of the steamship companies and the railway stations. But when the airlines and the transport operators started operating, they were unable to earn profit, as they could not sell enough tickets through their own offices. The airlines, therefore, were forced to identify sales outlets and thus started the concept of retail travel agencies. To boost their sales, the airlines offered higher commission to the travel agent. Retail Travel Agency A retail travel agency is one which sells the different travel related services directly to its clients on behalf of the principal service providers/suppliers. i.e. hotels, airlines, cruises, railways, coach operators, etc. and in retard earns commission from them. The retail travel agency may add a mark up cost on these travel services. Thus, it earns its income from the commission earned from suppliers as well as from the mark up. Definition According to Airlines Reporting Corporation (1987), 'a retail travel agency is defined as a business that performs the basic functions of quoting fares and rates, books seats for airlines, railways, coaches, makes reservations for hotels, arranges for passport, visa, and other documentation services, and acts on behalf of the tourism vendors'. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 The services performed by a retail travel agency are as follows: preparation of tour itineraries transportation air, rail, and road accommodation insurance services foreign exchange travel documentation special interest tours. Wholesale Travel Agency A wholesale travel agency plans, organizes, develops, and sells package tours through a network of travel agencies or directly to the clients if it operates as a retail travel agency. Some travel agencies operate as both retail as well as wholesale travel agency, for example, Thomas Cook, Travel Corporation of India, etc. The wholesale travel agency purchases the various travel products and services in bulk from the principal suppliers and sells to the retail travel agency or to the clients directly. Thus, the wholesale travel agency acts as a medium or a link between the principal suppliers and the retail travel agency. Definition A wholesale travel agency is one which assembles the different components of travel and forms a package to suit the needs of tourists. A wholesale travel agency thus designs package tour and sells then its agency's name Features The features of a wholesale travel agency are as follows: It serves as a link between the principal travel suppliers and the retail travel agency. it negotiates with the travel suppliers for best possible rates on bulk booking. It assembles the various travel components such as hotel, airlines rail, and ground transport to form a package tout. It conducts research to know the changing preferences of tourists It markets and promotes its products through advertising, etc. to increase sales volume. There are many ways in which travel agencies can be further classified. Travel agencies are generally classified as follows Full Service Agency A full service agency organizes and handles all types of tours for leisure, free individual travellers(FITs), group individual travellers (GIT), corporate travellers, etc. for inbound, outbound, and domestic destinations. Individual departments work on the different functions caver agency, for example, leisure department, inbound department outbound department, trade fairs, accounts, etc. Commercial Agency Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 Commercial agencies are specialized for meeting the requirements of corporate travellers. Such agencies are mainly located at the business centers and cater only to the business travellers. Walk-in or individual travellers are not served by these agencies. The airline, hotel, car/ coach documentation, etc. are all looked after by the trained staff. Implant Agency It is a branch office of a full-fledged travel agency/tour operator functioning on the premises of a corporate office. It handles all the travel arrangements of the corporate office. Special Interest Travel Agency Specializes in creating tour programs for special interest groups, such as adventure, wildlife, religious, etc. For example, Pug Marks, Pune. E-travel Agents or Online Travel Agents (OTA) Also known as virtual/online travel agents (VTA's) or e-retailers, they are the new generation travel agents such as MakeMyIrip.com, Yatra.com, ezeegol.com, Travelguru.com, and lastminute.com. These web portals allow consumers to access information and make online bookings. There are many ways in which travel agencies can be classified. FUNCTIONS OF A TRAVEL AGENCY The travel agency being an intermediary has an active role in providing quality services to the tourists The travel agency performs a number of functions such as: 1. Providing travel-related information 2. Planning tour itineraries 3. Liaisoning with the tourism suppliers/vendors 4. Tour costing 5. Ticketing domestic/international 6. Reservations 7. Documentation 8. Settlement of accounts 9. Trade fairs/business tours/meetings, incentives, conferences, and exhibitions (MICE) 10. Foreign exchange (Forex) Providing Travel-related Information This is one of the most important and basic functions of a travel agency. The tour professionals should have detailed knowledge of the tourist destinations, distance from the airport/railway station, different categories of hotels and the services provided by them, etc. The staff should be fluent in the local language, English, and foreign languages, if dealing with foreign countries. Planning Tour Itineraries The tour professionals after receiving the client's preference of destinations to be visited, his/her approximate date of travel and duration, the mode of transport, hotels, etc. has to plan the itinerary to suit the client's needs. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 The itinerary is a tour programme in sequential order which is designed day wise to identify the origin points, destinations en route points, hotel, meals, mode of transport, sightseeing, car/coach and other relevant details related to the tour. Some travel agencies and tour operators design their own tour programmes and sell them as tour packages. Liaisoning with Tourism Suppliers/Vendors The tourism suppliers are the airlines, railways, hotels, transport operators, cruise companies, tour operators, insurance companies, etc. The travel agents, before selling any form of travel product to their clients, have to contact these services providers for selling products on their behalf. The travel agents have to negotiate for the best possible rates from the service providers. The suppliers give a certain amount of fixed percentage as commission to the travel agents for selling their products. Some service providers also give net rate as per their relationship and business with the travel agents. The travel agents usually make an agreement or contract with the tourism suppliers in this regard. The commission structure, period of contract, and terms and conditions are mentioned in the agreement. Tour Costing After planning the tour and negotiation for rates with principal suppliers, the next job of the travel agent is to do the tour costing. The tour costing is done for both the inclusive tours (package tours) and individual tours. The tour costs are worked out on per person basis which include the hotel, meals, transfers, sightseeing by car/coach, guide fees and airfares. Ticketing This is one of the most common functions of a travel agency. The travel department of a travel agency has two sub departments domes ticketing and international ticketing. The executives at the travel desk should be aware of the flight schedules of various airlines, the air fare applicable for the journey, special fares, discounted fares, night fares, classes of travel, the booking and cancellation rules, the city/airport codes, reservation codes, special services, etc. The changes that occur from time to time, in international as well as domestic air schedules and the sudden additions/suspensions of new flights and airlines, make the travel executive's job very challenging. Thus an up-to. date knowledge of the schedules of various airlines is very important. The computer reservation system (CRS) is commonly used for making the airline bookings. The travel executives should also be familiar with the different global distribution systems (GDS) such as Amadeus, Galileo, and Sabre Settlement of Accounts Settlement of accounts with the tourism suppliers is one of the major functions of a travel agency. The executives working in the accounts department should be familiar with and have thorough knowledge of foreign currencies, their cross value, exchange regulations, etc. Documentation Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 This department helps its clients in providing facilitation services such as passport, visa, health certificates, insurance, customs regulations, immigration and permits required for restricted areas, baggage allowed, etc. for travelling abroad. Chapter 8 elaborates the concept further. Business Tours/Trade Fairs Apart from handling the leisure tourists and arranging domestic, inbound, and outbound tours, another major and much-in demand job for the travel agent is the handling of business tours. The travel agent has to meet the different demands of the business tourists. The business tourists may visit a particular destination for various reasons pertaining to their work such as to attend a business meeting, conference, convention, travel fair, selling products, meeting clients, etc. The travel agent has to work in coordination with the internal departments such as ticketing and documentation for the air booking and for arranging services such as passport, visa, insurance, etc. The travel agent has to arrange venues for meetings, conventions, and exhibitions; transport, accommodation, and sightseeing facilities, required at these venues and business centre facilities such as fax machines, laptops, video conferencing, etc. Reservation The travel agent after getting confirmation and initial payment from the clients has to book airline seats, hotel rooms, transport arrangement, and other services as per the requirements of the client. The tour professional should thus be familiar with the terms and abbreviations used for reservation procedure for airlines and hotels. The phonetic alphabet is preferably used for making reservations on telephone. Once the booking has been confirmed and payments made, the confirmed tickets, itinerary, and travel vouchers have to be handed over to the client. Forex Providing foreign currency, travellers’ cheques etc. to tourists and getting it endorsed on the passport is yet another important function performed by the travel agencies. This saves the trouble of visiting a bank or an exchange bureau. SETTING UP A TRAVEL AGENCY A lot of planning goes into starting and setting up of a travel agency. Any kind of business is risky and the person involved should have proper knowledge of the product he/she is selling. Similarly, for a travel agency business, the person should have good product knowledge and presentation skills. He/she should be clear about the product which he/ she wishes to sell. For example, whether the travel agency wants to handle domestic tours, inbound tours, outbound tours, or all of these, has to be decided in advance. This has to be decided by the travel agent at the initial planning stage. The staff to be employed should be trained properly to handle the queries asked by tourists. Qualified and trained staff should be hired by the employer to handle the clients. Requirements of a Travel Agency The travel agency can be successful if it meets the following minimum requirements: Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 • enough finance to run the business; • a centrally located premises or near a business centre; • qualified and trained staff; • approvals from government and other organizations, such as India Tourism Office, Ministry of Tourism, IATA, and TAAI; and • authorization to sell on behalf of principal suppliers, such as hotel, transport operators, etc.
Infrastructure, location, and adequate finance
For a setting up travel agency, the financial requirements are not very high. Investments are mostly needed for the following areas: • buying or hiring of space for office • furniture • computers • laptop • telephones, fax machine, photocopying machine, etc. • promotional material (brochures. etc.) • salary for the employees While setting up the travel agency, proper thought needs to be given to the location ol the travel agency. It should be near a business or industrial area, centrally located. or in areas where the travel. Hence, some research should be done on this Approvals by concerned organizations A travel agency should have the necessary approvals from the concerned organizations. For example, if the agency is into selling air tickets, It has (IАТА) to get approval from International Air Transport Association which is the world organization of scheduled airlines. Commission is paid only to the approved travel agents by the airlines. The travel agency has to submit the application form along with other required documents. The travel agency has to fulfill the following conditions: • ability to generate and procure air passenger transportation; • adequate financial status; • location of the travel agency near to business area; and qualified and experienced staff. IATA gives an approval only after an inspection by the concerned authorities. The travel agency should also have recognition from India tourism office, Ministry of Tourism, and licenses from the industry suppliers such as airlines, Reserve Bank of India, Passport Office, and recognition from the hotels. This is essential for earning commission from tec suppliers. The travel agency should be registered under the Shops and Establishment Act. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 SOURCES OF INCOME FOR A TRAVEL AGENCY The travel agency and tour operator's main source of income is from the commission, which they get from the various travel service providers The travel agency sells the airline seats, railway seats, hotel rooms, cruise packages, car rental services, etc. and in return are paid a commission for each travel product sold by them for the respective airlines, railways, hotels, cruise line companies, transport operators, and tour operators (see Fig. 7.4. The commission structure differs from supplier to supplier and also as per the business given by the travel agency and tour operator to these service providers. It ranges from five per cent to 20 per cent. Commission on selling their products to the clients The industry suppliers pay these approved agents a commission on the services sold on their behalf. The commission is usually a fixed percentage St the sales prices of the service or the product sold, and is paid to the travel agent/tour operator after the sale of the service or product. The commission is deducted from the final payment and the balance forwarded to the principal. For example, a client purchases a tour worth Rs 20,000. If the commission for that tour is 10 per cent for the tour operator then the travel agent will retain Rs 2000 and forward the tour operator the net amount of Rs 18,000. Some service providers such as airlines give commission only to officially appointed travel agencies. Officially approved agencies are those agencies which are approved by IATA. To be an IATA approved agency it is necessary that the staff working in the agency is IATA qualified Non-IATA accredited agents work as subagents for IATA accredited agents and earn a commission of around 4.5 per cent of the basic fare. Commission received from principal suppliers is shared by non-appointed Or non- IATA travel agents who obtain tickets from IATA appointed travel agents. Such commission is called split commission or shared commission. Incentives or overrides In addition to the commission, some service providers may pay incentives to the travel agents who have given large amount of business in terms of sales volume to them. These incentives are referred to as overrides or bonuses. The commissions given by the principal suppliers are normally fixed, but some suppliers offer the agency an override, i.e. higher the sales, higher will be the commission rate. Sometimes a part of this commission may be passed on to the customer as a discount rate. Service charges Service charges are another source of revenue to travel agents which are charged for services rendered to the clients. For instance, for getting a passport or a visa the travel agency charges the client as they do not receive any commission on selling these services. Some service providers may give the travel agent very less commission which is insufficient to cover the expenses of the travel agency. In such cases the travel agent charges the client for services rendered. The service charges differ from travel agency to travel agency and on the nature of service provided. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 Apart from the commission and service charges, the agency gets additional income from other sources. They are as follows: Mark up on tours A travel agent buys the travel products from the principal suppliers in large volume, at a net rate or discounted rate, and creates his/her own package tour. The travel agent tries to get the best prices for each component of the package tour and then adds a mark up to the tour cost for selling it to the clients directly or through other travel agents. Wholesale fee Some wholesalers may not pay the usual 10 per cent commission to the travel agents for selling their tours. Instead, they will pay a flat fee for each reservation made. Representation fee The tour operators or airlines may not have their branch offices in all cities of the country or world. In this case, the tour operator or the airline may appoint a general sales agent (GSA), who could be a travel agent, to handle their business in these cities, so as to generate higher sales. The GSA will handle the services of the tour operator or principal service provides to promote the sales. The tour operator will pay a fixed fee or commission and a budget for advertising and promoting their product to the GSA. THE TOUR OPERATOR The roles and functions of a tour operator are different to that of a tag agency. A travel agency may work as or offer the services of a tour operator. Tour operators are professionals who should have all the requires skills, expertise, and knowledge of organizing travel. The tour operator assembles all the different components of travel and sells it as a package tour, to and from a destination, with complete ground arrangement. Most of the tour operators have their own fleet of vehicles to cater to the transport segment. The tour operator offers different kinds of package tours as per the requirements of individual travellers, groups, retail travel agencies, business firms, etc. These package tours may be escorted or unescorted as per the need. Planning and organizing package tours is a time consuming process. Many tourists and individual travel agencies do not want to bother themselves with planning, booking the airline, and hotel rooms, etc. They want this to be arranged by someone else. This demand has thus led to the origin of package tours. The tour operator sells the package tours as per the interests and needs of the tourists. The tour costs of these package tours are different for different class of tourists, as per their budget. The package tours include the transportation (air, rail, or road), accommodation, tour escort/guide, etc. The individual who puts together all these different services into a package is called a tour operator. To be more precise, a tour operator is an individual who provides information, and plans and organizes the travel with various service providers to create a package tour. The tour operator also ensures that the tour runs smoothly without any hassles. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 A tour operator is sometimes also referred to as a tour consultant or a tour coordinator. Definition Tour operator is one who has the responsibility of putting the tour ingredients together, marketing it, making reservations, handling all financial and accounting aspects, and selecting as well as managing tour managers' (Poynter 1993). Responsibilities of a tour operator include the following: • Providing information of the tourist destinations, different kinds of accommodation available, transport facilities, any entertainment, etc. • Planning the tour effectively. • Coordinating and liaisoning with the service providers or principal suppliers. • Monitoring the entire operation of the tour. In case of any problem, providing some alternative arrangements with least inconvenience to the tourist. TYPES OF TOUR OPERATORS A tour operator specializes in the planning and organizing of prepaid, preplanned tours and sells these directly either to the tourists or to the retail travel agency. The tour operator may target market some specific areas to sell the tours. The tour operator may be international, domestic, or specialized in a region or continent. Some tour operators cater to international as well as domestic markets. The tour operator can be an individual/independent tour operator or a travel agency functioning as both. Tour operators are broadly classified into the following as per the functions performed. Inbound Tour Operator Inbound tour operators operate and handle the inbound tourists coming into the country from overseas. The tourists are provided various services right from their arrival such as airport transfers, accommodation, car/ coach for sightseeing, entertainment, etc. till their departure. The inbound tour operators get their business either directly from individual inbound tourists or through the foreign tour operators. The inbound tour operator helps in boosting the economy of the host country by contributing to the valuable foreign exchange earnings. Outbound Tour Operator Outbound tour operators operate tours to foreign countries, which can be either to a single country or for more than one country. The tour operators design and market package tours for outbound tourists for a specific predefined period. All the necessary arrangements for documentation such as passport, visa, insurance, etc. are also taken care of by the outbound tour operators. These operators work in coordination, arrangements, sightseeing, etc. Domestic Tour Operator Domestic tour operators conduct tours within the country and cater to the needs of individual and group travellers. The domestic tour segment has witnessed a
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September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 phenomenal growth in the recent years as many large tour companies have entered the market. For example, Thomas Cook, Cox & Kings, Kesari Tours, etc. PACKAGE TOURS The various components of travel, such as accommodation, transportation, the variety, rail, and road), attractions, etc. are combined and sold ay package tour to the tourist by the tour operators and travel agents package tour is thus a single product which is planned, organized combined, and sold as an 'all inclusive tour' at a specified price by the tour operators. Package tours are in use since the 1600s. Thomas Bennet organizes the first inclusive tour in the year 1821. He set up his business as a tour operator in 1850 and made the first individual tour itinerary and booked the hotel and other arrangements. But the credit for the concept of package tours goes to Thomas Cook. In 1855, Cook planned and organized all the different components of a tour package and sold it as an inclusive tour to the tourists. After the success of his tour, other travel agents and tour operators also started operating similar tours to other tourist destinations. Definition A tour package is a total tourism product which is planned and operated for either independent travellers or for groups, to a single destination or to multiple destinations. It consists of air travel (generally) and land arrangement segments for a specified number of days, with a set of tangible and intangible features for a set price. A package tour is thus a programme which is organized for an individual or for group travellers having all the necessary tour ingredients such as accommodation, transportation, sightseeing, and also, if required, guides/escorts, entertainment, etc. Different people have given different definitions, as tour package is a broad concept. Holloway (1992) defines the tour package as, 'A tour package is a total tourism product as it generally consists of transport from the generating area to the destination, accommodation at the destination and possibly some other recreational or business tourist services: A tour package is an advertised journey including specific features, arranged and promoted with tour literature by a tour operator and paid for in full by the tourists before starting on the tour? (Gregory 1985) A package tour is thus a product which is planned, organized, operated, and sold at a set price to individual tourists or groups, to a single or multiple destinations, usually involving air travel, accommodation, and land arrangements for the number of days specified. Some experts have defined package tours based on 1. Destinations and 2. Interests of the tourists Destinations The destinations are further classified into single country, area tour, single city tour, and two city tour. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 Single country package tours Organized for only one country, for example, China. Area tour package tours Organized for visiting more than one country, belonging to a common area. For example, tours to the South-East Asian countries such as Singapore, Thailand, and Malaysia; and tours to Europe and America. Single city tour package tour Organized for only a single city, for example, Aurangabad, Hyderabad, etc. Two city tour package tour Organized for two cities. For example, Delhi-Agra tour, Jodhpur-Udaipur tour, etc. Interests Some package tours are designed and organized as per the different needs and interests of the tourists. Tourists may visit certain destinations for different purposes including • cultural sites/historical sites such as Taj Mahal, Agra; Lake Palace, Udaipur; and Pushkar Fair, Pushkar • special interest tours, for example, rail tours, such as Kalka-Shimla toy train, Palace on Wheels, etc. • adventure tours designed for adventure activities such as trekking mountaineering, wildlife sanctuaries, hang gliding, paragliding, etc. • sport tours, for example, Olympics, golf tours, car racing, cricket, football, etc. Advantages Advantages of package tours are as follows: • Package tours save time, as the tour operator, plans and organizes travel details with the principal travel suppliers, for the tourist. • Unnecessary correspondence is also reduced. • They work out to be cheaper than the other tours. Disadvantages Disadvantages of package tours are as follows: • Package tours are planned well in advance and do not have personal choice of destinations for the tourist. • The tourist cannot change the itinerary as per his/her choice as it is already preplanned and prepaid. • Some tourists may not be interested in visiting all the places mentioned in the package tour. Components of a Package Tour A package tour consists of the following components/elements: • accommodation • travel by airline/railway • transfers to and from airport/railway, and hotels • sightseeing Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 • guide/escort The above components can be broadly classified into two parts: 1. Travel arrangements 2. Ground/land arrangements Travel arrangements Travel is related mainly to the air transportation in the tour itinerary. The tour operator negotiates with the airlines for group bookings and also bulk purchase, and combines it with the land arrangements to sell as a package tour. Some tour operators also coordinate with air charters, which work out to be cheaper than the regular scheduled airlines. Air travels is one of the core elements for the inbound and outbound tour package. Ground/land arrangements It includes the transfers, le. pick-up and drop from the airport/railway station and the hotel, accommodation, meals, car/coach for sightseeing, guides/tour escorts, entertainment, shopping, and other special requirements or services for the tourist. Ground arrangements are looked after by the ground handlers. Ground handlers are agents that work on behalf of international and domestic tour operators, travel agents, and principals. They look after all ground arrangements, once the tourists reach the destination, such as transfers from airport to hotel, booking of hotel, car rentals, excursions, entry tickets for attractions and activities, restaurant bookings, shopping, etc. The tour operators coordinate and negotiate with the hotels and transport operators for discounts or special rates TYPES OF PACKAGE TOURS Tour operators nowadays offer a wide variety of tour packages as per the needs of the tourists. These are discussed as follows: Independent Tours Independent tours are specially designed or tailor-made as per the requirements of the individual tourist. Such tours are not published in the company's tour brochure. The travel agent/tour operator combines all the travel and land arrangements and coordinates with the principal suppliers for special or net rates. A mark up is usually added to the price to cover his/her expenses. Such tours are also known as foreign independent tours (FITs) and domestic independent tours (DITS), depending on the location of the destination of the package tour. Inclusive Tours For inclusive tours, the tour operator purchases all the different components of the tour package in bulk from the principal suppliers at a special or group rate. The package is advertised, and sold to the tourists at an inclusive price by the tour operator. The inclusive tours work out to be cheaper than the independent tours for the tourists, as the tour operator gets it at a group rate. However, the tour members have to travel in a group for the entire tour.
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September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 Sometimes tour operators incur a loss for inclusive tours if they are unable to sell the required seats and rooms, which are usually purchased one year in advance from the suppliers. Escorted Tours Escorted Tours The tours which include the tour escorts a it stom the ers are known. esco ted tours. The tour escortis present rig. I he tour commencem escorted ours upto the return of the tour The cion escort assigns it tavelers troughout the entire tour Histion tund ine is to receive be tour members at the airport/railvay station and help them throug Customs clearance and other airport formalities both at the time of ari and departure. Such tours are also known as conducted tours or hosted tom Business Tours The business tours are specially designed and packaged as per the requirements of the clients. People travel for business for various reasons and for varying durations. The tour operator arranges the accommodation, facilities/services required, transport, and sightseeing as per the schedule of the business visit. Some tour operators also arrange conference tours and incentive tours. Conference tours require special skills, as special arrangements have to be made for such tours. The tour operator has to look after the conference arrangements right from the initial stage of organizing, selecting the venue, marketing the conference, booking of accommodation and transport, secretarial services, conference equipments, conference facilitation such as registrations, interpreters, special events, entertainment, local sightseeing, and other facilities. More recently, incentive tours have also appeared and companies are offering incentives to their dealers or employees in the form of additional payments, gifts or some kind of a holiday. The incentive tours are very popular and are usually of shorter duration. Such tours are a motivational factor for the employees and the dealers. The tour operators have to pay attention to details such as size of the group, the cuisine preferred, gifts, theme parties, baggage handling, etc. The size of the group for incentive tours varies from one company to another. GUIDES AND ESCORTS Guides and escorts have gained importance ever since tourism has been recognized as a great economic activity. Guiding and escorting tours are now being considered as highly professional business activities. Special skills and qualities are required by the guides and escorts if they are to be successful in this field. Guides A guide serves as a public relations representative for his/her particular site, city, region, and country. A guide should therefore be knowledgeable about history, geography, sociocultural practices, etc. related to his/her area of concern, so as to inform the tourists accordingly. In India, the India Tourism Office, Ministry of Tourism regularly conducts courses to train new guides. The guides are given licenses and are approved by the Ministry of Tourism to work as freelancers. The fees are
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September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 decided upon by the India Tourism Office depending on half day, full day, or overnight charges and also for foreign languages as required. Definition 'A professional guide is in varying degrees a business person often freelance, sometimes an employee; a travel industry representative; a public relations representative for his or her site, city, region, and country as well as an educator, an entertainer, and a public speaker, among other roles.' (Kathleen Lingle Pond, The Professional Guide, New York 1993) Location guides In India location guides can be categorized into the following different categories depending upon the locations. Monument guides The monument guides are specialized in describing the history of the monumental heritage of India. The monument guides should have proper historical knowledge of the monument and the region so as to describe the same to the tourist. They should be aware of all historical facts of the monuments like the date and time taken for construction, the architect, and the purpose of constructing the monument. The guides should be able to make the entire particulars interesting to the tourists in the form of fables and anecdotes. Museum guides The museum guides should have knowledge about the various artifacts/exhibits displayed at the museum. They should know the area of interest of the tourists. This will help the guides in deciding to curtail or extend the time spent in visiting the museum. The tourists might also appreciate the varieties and the artistic merits of the artifacts, in which case more time should be spent in the museum. Wildlife guides The guides located at wildlife sanctuaries should be familiar with wildlife tourism. Many tourists visiting any wildlife reserve are at times not familiar with the wildlife they are visiting and thus it becomes important for these guides to instruct them and give proper information. City guides The city guides should be able to profile the tourist visiting the city and their purpose of travel. The city guides should be aware of the opening and closure of the tourist attractions and also on which particular day the attractions are closed. They should pay detailed and careful attention on the commentary of the tour. The guide should see that the tour does not physically tire the tourists. There should be enough and adequate stops during the tour along with sufficient time for shopping.
Skills required for guiding
Leadership A tour guide should have good leadership qualities such a decision making, flexibility, enthusiasm, confidence, sensitivity, and should have a good sense of humor. Factual knowledge The guide should have knowledge about the topography, geography, history, culture, religion, folk art, folklore economy, etc. related to the city, region, state, or country. Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 Presentation skills The guide should have good presentation skills such as a clear voice and good body language. The voice should be lively and the guide should be able to explain the site in simple language. Grooming Personal hygiene, positive attitude, good manners, and Politeness are the other qualities which are desirable in guides and escort Escorts An escort has to accompany the tourists right from commencement till the end of the tour. He/she has to perform the role of a tour leader or a tour manager. The escort may accompany the tourists to historical sites, rural areas, pilgrimage places, shopping, museums, etc. The escort has also to look after the facilitation of the tour such as the check in formalities, customs clearances, etc. The escorts have to take care of the tourists, throughout the tour and at the destination. The tour escort has to plan the tour properly with a schedule of events and live the tour day by day. He/she has to be prepared with alternative arrangements incase of any unforeseen circumstances due to weather, transport strike, accident, etc. The tour escort should be well prepared in advance with all the travel arrangements such as checklists, tour itinerary, commentary of tour, and travel tips. The tour escort should also be able to handle the tour in case of special unforeseen situations. Some frequently encountered problems during a tour which may arise are loss of money, loss of passport, sickness of any tour member, missing tour members, etc. The tour escort should be able to handle the tour members in an effective way and advise them accordingly so that time schedules are maintained and there are no missed trains or flights. The travel agent and the tour operator, thus form the two main intermediaries in the tourism distribution chain. They play a vital role in not only providing various services to the traveller, but also in promoting destinations and in the overall growth of the tourism industry. Guides and escorts at the destination or accompanying the group, are an essential part of the tourism experience. Intermediaries thus form a vital link between the tourism supply and demand in the tourism system. Tour operators and travel agents too have to keep pace with the technological advances and changing scenario of the tourism industry and offer value added services and professional services. SUMMARY Travel agents and tour operators are the main intermediaries in the tourism industry, serving both the suppliers of tourism products and services as well as the tourists or customers. Principal suppliers, such as hotels, airlines, transporters, etc. need a distribution channel so that their products reach the customers. Because of the perishable and intangible nature of the tourism products they play a very important role in ensuring that the products produced by the suppliers, are consumed. A travel agency is a retail outlet for the promotion and purchase of different travel- related services. A tour operator is a person who assembles all the different components of travel and sells it as a package tour to and from a destination with Effective Date: Effective Date: September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022 complete ground arrangements. These package tours may be escorted or unescorted depending on the needs of the customer. Travel agents perform many functions such as providing travel information, planning itineraries, ticketing, reservations, documentation, tour costing, and Forex- and MICE-related services. Their source of income is mainly from commissions received from the various suppliers and service charges from the customer. They are a vital link between suppliers and customers. They offer a wide variety of tours to suit the needs of tourists both for independent and group tours.
September 2022 Effective Date: September 2022 Effective Date: September 2021 September 2021 Review Date: June 2023 Review Date: June 2023 Review Date: June 2022 Review Date: June 2022