unit 13 – M2

Explain the ways of being able to maximise profit throughout the different stages of selling, administering and operating a package holiday. 

Maximise profits through selling package holidays 

Tour operators can maximise profits by selling package holidays and using different methods and techniques. The main method is to sell package holidays at a lower price than what the customer may pay if they book it themselves. Tour operators aim to buy all of the components to make a package holiday at the lowest price they can and then selling it cheaper than competitors so customers choose them and the operators get a profit margin.  Another way tour operators can maximise profits is by having their own airline; this is because they will then not to need to buy seats on aircrafts as they have their own aircrafts to fly their customers to the destinations of the package holidays.

Maximise profits through administering package holidays 

Tours operators can maximise profits by the administering part of package holidays by making customers pay a fee: as a deposit of the package holidays (the lower the deposit, the more customers booking package holidays there will be), to make any amendments to the booking or on the tickets (changing the dates of the holiday) and to cancel the holiday completely will cost a lot. The administration part can also be: printing the tickets and sending them to the customers, making travel itineraries for the customers at a price, planning the trip down to the very last minute and finally they plan and book excursions for the customers to do whilst on the holiday. The customer may want the operators to book excursions as well as putting it into the itinerary.  
Maximise profits through operating package holidays

Operators can maximise profits by the operating part of package holidays. To make a higher profit, there must a smaller ratio of booked compared to the total availability. Another way is having their own transfer company, meaning they do not have to create a contract with transport operators and are able to save money by having their own transport. They can also sell excursions for customers to book whilst they are on the holiday. The operators may have a contract with the excursion companies allowing them to offer deals and offers to the  customers.