Unit 13 – P3

Tour operators plan a package holiday by three key elements: Research & forecasting and product development, contracting and costing the package. In the first part of the handbook I will be explaining all three elements along with: data input and timescales.
Research, forecasting and product development:
 I will be outlining how tour operators research, forecasting and product development individually.

Tour operators use government data sites for information (expand on that), they go on competitor’s websites to view prices to be the cheapest compared to other tour operators.  They often send staff to destinations to research about and decided which target markets are suitable for the researched destination and research popular destinations where people want to go. They also give existing customers surveys to complete.

Tour operators use forecasting as a way of working out where package holidays could be made and a profit earned. They look at destination development; Dubai is a destination where extreme development has taken place over the last 20 years for tourist and holiday makers to come and visit.  They work out what the peak seasons are (normally summer and winter) and plan package holidays around those two main seasons.  The tour operators forecast when there will be a royal family occasion as if there is a bank holiday people may book to go on holiday, as they are getting paid time off of work. They forecast about dark tourism, where people would like to go destinations where they has been war and natural disasters, as they want to help the injured or experience what happened in the certain destination. Also, weddings abroad are becoming more popular, so tour operators try to plan package holidays for weddings.

Product development:
Tour operators use feedback forms and reviews to see the things customers enjoyed about their package holidays and what they would like in the package holidays. They use social media to see what the popular and up and coming destinations there is.  Advertisement of destinations help tour operators where to plan package holidays and monitor competition to gain competitive advantage over new and popular places. Tour operators keep an eye on where celebrities go to on their holidays, as people may want to go to the same destination so they feel like a celebrity and can say they’ve been to the same place.

Methods of contracting:
There are three methods of contracting a package holiday: commitment/ guarantee, allocation & release back and Ad hoc. Contracting is negotiating rates with airline, accommodation and transfer providers.

Commitment/ Guarantee:
This contract allows tour operators to book a certain number of beds in hotels or seats on airline providers and have the right to use them by a given date. The tour operator guarantees to pay for a certain amount of bed spaces or plane seat which then allows them to combine it into the package holiday.

Allocation & release back:
The contract allows tour operators to bargain with the service provider, for example a hotel, the availability of a given number of beds for a specific date. Tour operators have the right to resell to the final customers as part of the package holiday. The tour operator hols the right to return any unsold rooms by a deadline back to the service provider.

Ad hoc:
Tour operators use this contract as it is a flexible arrangement. The contract is agreed by the tour operator (usually at a discounted rate) with a service provider and makes bookings as and when needed to make the package holiday.