DEPARTMENT OF TOURISM AND HOTEL

MANAGEMAENT
KURUKSHETRA UNIVERSITY,
KURUKSHETRA

1ST ASSIGNMENT ON

Tour Operations and Travel Agents

SUBMITTED TO: PROFESSOR

SUBMITTED BY: Anjali

MBA BUDGETED (PREVIOUS)
ROLL NO: 104
UNIVERSITY SCHOOL OF MANAGEMENT
 Tour Operations and Travel Agents
Introduction
The tourism and hospitality industry are an essential sector that attracts tourists to the
destination of their choice. Development in this industry results in attraction of more guests
and tourists to the destination. Travel agents have a key role to play in the tourism industry.
The role of travel agency in the promotion of tourism in India is very crucial in the new
millennium. Travel intermediaries play a very significant part in the development of Indian
tourism industry. The nature of travel agency business is to provide holiday-related services
such as ticket booking, transfer arrangement, hotel room booking and arrangement of ground
transportation, venue selection and booking for MICE activities. The scope of business of
travel agents was narrow and confined to selected services. Moreover, the business was
managed with small investment. It was risky business as it was depending upon the natural
and socio-political along with cultural factors (Khumalo-Ncube & Motala, 2021). The
amount of profit was too little to attract new entrants to do this business. A number of
restrictions were imposed by the government on travel agents and tour operators for entry
into tour operation business. Tour operators had no choice, but to deal with other problems
like confirmation of hotel rooms, safety in travel, quality of foods, travel documents, volatile
political system, language differences, cultural differences, cumbersome and tedious
travelling, long journey, etc.
 An Overview of Role of Travel Agents and Tour Operations:
Travel agents are solely indulged into marketing the concept of travel and plan and
sell holiday trips and ancillary services to individuals and groups. Travel agents do book
tickets for air, rail, sea or road travel, arrange hotel reservations or guest houses, hire taxis
etc. Besides domestic, all travel agents undertake international bookings and special business
tours or conferences. On the contrary, tour operators are mostly involved into bulk travel
arrangement and management for individual and groups. It is recognised as principal agent or
wholesaler and offloads business to the ground handling agents. Tour packages are mostly
promoted by the tour operator through the travel agents(Pinto & Castro, 2019). Tour
operators can offer special packages that include such diverse attractions as deep-sea diving,
snorkelling, Himalayan trekking or even camel safaris in the Thar Desert.

Key challenges faced

The travel agents play a key role in the tourism and hospitality industry. In the
traditional system, the travel agents have a key role to play in ensuring urgent bookings and
providing an assured travel and stay package to the tourists, who book their packages through
the travel agents. However, with the introduction of internet and the information
communication and technology, the business of the travel agents has fallen remarkably. The
travel agents find hard to find clients, since most of the customers prefer the online booking,
to the travel agents. The recent developments in the ICT bought in a revolution in the tourism
industry. This has created opportunity for the customers, to contract directly with the
suppliers, thus eliminating the requirements of the travel agents. Lack of human resources, as
well as the lack innovative ideas among the travel agents, resulted in decline in the market of
the travel agents. Lack of openness to changes is also a major issue faced by the travel agents.
Moreover, another issue that is faced by the travel agents is that the companies are refraining
from paying to the travel agents, in order to lower the investments.
Thus, the online reservation portals replaced the travel agents. The traditional travel
agents merely manage the information regarding a tourist destination and provide a complete
solution to all the queries of the tourists. Moreover, the travel agencies are often biased. They
are often in favour of the hotels that offer them the maximum commission. Thus, the solution
given by the travel agents or the hotels recommended by them are often not reliable. A
number of specialised websites has emerged primarily as an advisor and a middle-man
between the customers and the hotels and the suppliers. However, with the use of the internet
and the online reservation systems, these would offer the guests with discounted travel
packages, thus replacing the travel agents. The computer literacy of the travel agents and the
lack of upgraded infrastructure also resulted in the decline of the position of the travel agents.

Travel Agency:
A travel agency is a private retailer or public service that provides travel and tourism
related services to the public on behalf of suppliers such as airlines, car rentals, cruise lines,
hotels, railways, and package tours. In addition to dealing with ordinary tourists most travel
agencies have a separate department devoted to making travel arrangements for business
travellers and some travel agencies specialize in commercial and business travel only. There
are also travel agencies that serve as general sales agents for foreign travel companies,
allowing them to have offices in countries other than where their headquarters are located. A
travel agency’s main function is to act as an agent, selling travel products and services on
behalf of a supplier. Consequently, unlike other retail businesses, they do not keep a stock in
hand. A package holiday or a ticket is not purchased from a supplier unless a customer
requests that purchase. The holiday or ticket is supplied to the agency at a discount. The
profit is therefore the difference between the advertised price which the customer pays and
the discounted price at which it is supplied to the agent. This is known as the commission. In
many countries, all individuals or companies that sell tickets are required to be licensed as a
travel agent. In some countries, airlines have stopped giving commissions to travel agencies.
Other commercial operations are undertaken, especially by the larger chains.
These can include the sale of in-house insurance, travel guide books, and public
transport timetables, car rentals, and the services of an on-site bureau de change, dealing in
the most popular holiday currencies. A travel agent is supposed to offer impartial travel
advice to the customer. However, this function almost disappeared with the mass market
package holiday, and some agency chains seemed to develop a “holiday supermarket’’
concept, in which customers choose their holiday from brochures on racks and then book it
from a counter. Again, a variety of social and economic change shave now contrived to bring
this aspect to the fore once more, particularly with the advent of multiple, no-frills, low-cost
airlines.

Customer satisfaction and delight is given top priority. A high degree of professional
accuracy is needed to survive in the business. It is otherwise difficult to stay in the business.
Most of the essential services are primarily provided by travel agents include transport (road,
rail, air and water), accommodation, passport, and visa procuring facilities, foreign exchange
and also guidance and information about the places of travel. Many travel agents sell
packages on commission basis offered by inbound operators.
Types of travel agency:
Travel agencies are broadly divided into two basic categories: Wholesale travel agency and
retail travel agency as per the distribution of sale of tourism related services. In addition to
the above-mentioned classification, travel agency can also be classified as implant agent,
conference and meeting planners, trade fair organiser, Destination Management Company
(DMC), online travel agency, home based travel agent etc.

Wholesale Travel Agency: A wholesale travel agency accumulates different components of

tourism services to design tour packages for catering Free Individual Traveller (FIT) and
Group Inclusive Traveller (GIT). A wholesale travel agency is one which initiates the process
of designing organised package tours or sells the individual travel components directly or
indirectly through franchise, sub agents and retail agents. For example, a wholesale agent of
Lufthansa airline or Sheraton Hotel chain is authorised to sell the airline tickets or hotel
rooms on behalf of the principal service vendors.
Retail Travel Agency: A retail travel agency is one which sells its services directly to
tourists or travellers at various small locations. Retailer receives commission from the gross
sale of hotel rooms, airline, railways, bus, car and cruise tickets, insurance, foreign exchange,
etc. The primary source of revenue is commission which they receive from various service
providers. A two–way selling method is followed in retail travel agencies. The role of retail
travel agencies is very crucial as majority of principal travel service providers have no choice
to increase the sale without the help of retail travel agencies.
Other Types of Travel Agencies:
 Implant Agent: It is a different type of travel agent which is located in the premises
of corporate offices to take care of their travel arrangements. Generally, a retail or
wholesale travel agency makes an agreement which corporate house to serve their
employees, A mutual agreement is done between both the parties where corporate
house provide travel agent space and basic infrastructure at their premises, and travel
 agent organises their own set up for exclusively serving the employees. One of the
major implant agents is HRD SITA.
 Conference and Meeting Planners: Meeting, convention, and event planners
coordinate all aspects of events and professional meetings. They arrange meeting
venues, transportation services, accommodation, food and beverages for participants,
pre and post conference sightseeing and other related activities.
 Home Based Travel Agent: Home–based travel agency is one engaged in the
marketing and selling of travel products from a home office. But that can cover a
wide variety of different types of home–based travel agents who might have very
different looking businesses. The home–based travel agent and the host agency share
the commissions paid by travel suppliers according to a negotiated percentage split
that reflects (or should reflect) the amount of work and effort expended by each party
in making the booking happen.

Functions of Travel Agents:

Motivation: Travel agents inspire you to travel, plan, and prepare for your trip. Travel agents
assist visitors in determining their travel interests and needs, including time and budget
constraints. They develop preliminary plans and suitable alternatives before finalising all
arrangements.
Tourist Information: Agents book tours for a variety of tourists. They organise group tours
and design trips for individuals. Travel agents consult a variety of published and computer–
based sources for information on departure and arrival times, low–cost fares, car rentals, and
hotel ratings and amenities. Maps, official guides, tariff books, the internet, and other
reference materials can be used to obtain schedules, fares, and related information.
Travel Arrangements: Airline, hotel, and car reservations are made by agents on behalf of
tourists. They use computerised reservation and ticketing systems similar to those used by
airlines to make reservations and issue itineraries. They also calculate costs and accept
deposits.
Customised Service: A travel agent can create a vacation or travel plan by arranging special
accommodations, customising a schedule to meet the needs of the client, and designing group
packages and tours.
Source of Information: Customs regulations, passports, visas, immunisation requirements,
and currency exchange rates are all kept up to date by agents. They provide information on
the weather, prices, what to bring or buy, and must-see attractions. They stay current by
travelling, reading travel magazines, and attending industry seminars and trade shows.
Deals in Foreign Currency: They arrange for foreign currency and inform the traveller
about the currency regulations prevailing at scheduled destinations.
Market Feedback: It is critical to provide market feedback. This is a critical function of a
travel agent. This aids in the improvement and planning of better tours by tour operators.
Agents typically work indoors and share offices with several other agents. Travel agents
spend the majority of their time advising clients, completing paperwork, contacting airlines
and hotels for travel arrangements, and promoting group tours.

Features and Importance of the Travel Agency

Travel agency plays an important role in the travel sector business. Some most important
features and importance of the travel agency business are following:
1. An important link between the clients and principal suppliers.
2. Image-Builder.
3. Ensures rapid travel services.
4. Provider of authentic and reliable travel information.
5. A social a continuous process.
6. Establishes a good relationship with clients and vendors.
Responsibilities of a large travel agent
 It works as a retailer and sells package tours on behalf of wholesaler. The sale of
package tours involves the rate of commission fixed on the agreement.
 It ensures horizontal integration for the purpose of achieving bumper sale.
 It is an intermediary between tour operators and tourists in terms of selling package
tours in case of outbound tours and conducting sightseeing tours in case of inbound
tours.
 It follows tour itinerary and it does not have anything to do with itinerary.
 Travel agents also provide destinations transfer services to the clients as per the tour
Requirements and skills
 Proven work experience as a Travel Agent
 Excellent knowledge of computer reservations systems, GDS systems and e-
travelling
  Fluency in English; multilingualism is a plus
 Strong sales skills and commercial awareness
 Ability to interact, communicate and negotiate effectively
 Sound knowledge of domestic and international travel trends
 Degree in Hospitality, Travel, Tourism, Business or relevant field
 Personal travel experience will be considered an advantage

What makes a Good Travel Agent?

Travel Agents have to be able to work in a timely and efficient manner. They work with
clients who have specific time frames set for their traveling. This means these professionals
have to be able to meet simple deadlines and not get distracted.

Who does a Travel Agent work with?

Travel Agents work with Travel Consultants, who're often the first individuals’ clients go to
when looking to book vacations. Consultants present them with various travel packages,
providing them with essential information before planning the outing. The Agent then
ensures their comfortability when the venture takes place, utilizing the data from the travel
package during their vacation.

Services Offered by Tour Operators & Travel Agents:

 Transfers to and from the airport and hotels are arranged.
 Making preparations for a traditional greeting at the points of arrival.
 Organising luggage transportation at the airport and train stations.
 Organising sightseeing trips with guided guides.
 Creating options and selections for itineraries to various locations across the world.
 Land arrangements for creating a custom itinerary.
 Clients can choose from a variety of hotels and make reservations.
 Meeting, conference, and meeting arrangements are the responsibility of the
professional.
 Organising trade show and factory tours for visitors.
 The creation of themed parties and activities for travellers with a specific interest.
  Booking of airline tickets as well as making travel documentation such as passports,
visas, health certificates, and permits for restricted areas.
 Tourists' foreign exchange and travel insurance are handled.

Travel Agency Business Returns

As far as the sources of profitability are concerned, travel agents usually make it through
more sales of services. There can be two ways of increasing the margin of profits. One way is
to increase the sale of each unit of service with minimum profit margins and other alternative
way is to provide unique services with premium price. It is however clear from the practices
of travel agency business that the sources of profit for a global conglomerate or a small travel
agent with limited service do have not much variation.
Sources of Commission

Tour operations:
Tour operations generally means by handling related arrangements with a travel schedule
of a tourists inside the travel agency which includes his air tickets and rail tickets to a
particular destination of tour. Ticketing is the most important part of the travel operations
which starts right from the demand generated by a client for travel to a particular
destination. In brief, the arrangements related with movement from one place to another
 place of a client are called travel operations. Tour operator is an organization, firm or
company who buys individual travel components, separately from their suppliers and
combines them into a package tour, which is sold with their own price tag to the public
directly or through the middlemen is called a tour operator. More precise tour operators
are primarily responsible for delivering and performing the services specified in a given
package tour. They can provide these services themselves as some have their own
infrastructure like car/ coaches and hotels etc. or can obtain these from other suppliers.

That’s why they are called manufacturers of tourism products. Tour operators generally
provide the services independently and tours are conducted at the cities where the offices are
located. However, these services can be arranged though the other suppliers at various places.
Package tours are retailed through travel agencies or directly to customers. However, a tour
operator may have readymade or tailor-made packages as per the trends of market. The
distribution of package tour business passes through various stages.
 Features of Tour operations
Multi-tasker
The tour operator is the leader of any activity that has been planned, and they must be able to
conduct themselves as such. An effective leader is organized and is able to effectively use
technology in order to maximize the efficiency of the tours. At any given moment, the tour
guide should know the latest manifesto, understand the availability of resources and be able
to troubleshoot should the need arise.
Culturally aware
Tour operators work with travellers from all walks of life and from the far reaches of the
globe. They need to be aware of the cultural norms of their target market segments, and have
an open mind when dealing with people of a variety of backgrounds. It helps for tour
operators to be fluent in multiple languages, as this improves the guest experience for
international tourists.

Capable of dealing with ambiguity

Every day is different when you are a tour and activity operator. The best guides are able to
adapt to changing circumstances. This includes staying composed in the event of an
emergency, or when someone is delivering negative feedback. It means that they are able to
think quickly on their feet, and deliver solutions if a problem arises. They are comfortable
with the flexible nature of the position and the excitement that each day can bring.
Resourceful
In addition to being able to multi-task while conducting a tour, a tour guide also needs to
know how to use the resources that are available. Sometimes, this means using a mobile
device to access cloud-based technology and provide customers with the information they
need (Marin-Pantelescu et al., 2019). In other cases, such as in the event of an injury or
illness, the tour operator will need to be able to provide first aid care. The best guides know
what resources are within arm’s reach, and they know how to best use those resources.

Functions of tour operators

A tour operator is like a service provider, providing the most convenient option for tourists to
stay, visit, as well as leave from the city. A tour operator owns a high volume of travel
services across carriers, services, and accommodation. Some most important functions of the
tour operators are following as:
Planning a Tour
The most important functions of the tour operators are planning a tour. Tour operators plan a
tour and make tour itinerary which contains the identification of the origin, destination and all
the stopping point in a traveller’s tours. A prospective tour operator also gives advice to
intending tourists in various types of tour programmes, which they may choose for their
leisure or commercial travel.
Making Tour Package
Tour operator buys individual travel components, separately from there suppliers and
combines them into a package tour. Tour operators make tour package by assembling various
travel components into a final product that is called tour package which is sold to tourist with
own price tag. Making tour packages is also an important function of Tour Operator.
Arranging a Tour
Tour operators make tour package and also arrange a tour according to tourist demands. Tour
operators arrange the tour package and various tourists’ activities to provide the best
experience to tourists/traveller.
Travel Information
Whatever the size of tour operators, it has provided necessary travel information to the
tourists. This task is utterly difficult and very complicated. A tour operator must give up-to-
date, accurate and timely information regarding destinations, modes of travel,
accommodation, sightseeing, immigration, health and security rules about various permits
required to travel in a particular area etc.
Reservation
It is a very important function of all type tour operators and travel agencies. Tour operator
makes all the reservation by making linkages with accommodation sector, transport sector
and other entertainment organizations to reserve rooms, and seats in cultural programmes and
transportation.

Travel Management
Tour operators manage tour from beginning to the end of the tour. A tour operator has the
responsibility to look after the finer details of a vacation or tour such as hotel,
accommodation, meals, conveyance etc. Tour operators provide travel guide, escorting
services and arrange all travel related needs and wants.

Different types of tour operations:

 Inbound Tour Operations
 Outbound Tour Operations
  Domestic tour operations
 Ground operations

Inbound Tour Operations: These are also known as incoming tour operators.
Technically, the operators who receive guests / clients/ tourists and handle arrangements in
the host countries are called inbound tour operators. For example, a group of American
tourists is coming through TCI limited to India and the company makes arrangements and
handles the group in India then TCI is called an Inbound Tour Operator.
Out bound Tour Operations: Tour operators who promote tours to foreign
destinations may be business tours or leisure tours are called out bound tour operators. Indian
out bound tourist traffic is growing at the rate of 11% annually and this makes India as the
second largest country in the world with regard to the traveling population. There are many
travel companies which offer outbound packages such as Raj Tours Travels, SOTC, TCI,
Thomas Cooks and sons etc.
Domestic Tour Operations: Domestic tour operators are those who assemble combined
tourists’ components into inclusive tours and sell it to the domestic travellers. In general,
these tour operators provide travel services in the tourist’s native home country. Domestic
tour operators operate within the boundary of home country and offer package tours to the
travellers viz., domestic inclusive tours or independent tours.
Ground Operations: These are commonly known as handling agencies and their main
function is to organize tour arrangements for incoming tourists on behalf of overseas
operators. When a tour operator himself promotes beach holidays, wildlife holidays,
adventure and heritage tours, cultural tours at different places then the role of ground operator
become effective. It is the ground operator who by handling the incoming travellers at
different places makes the tour successful
 Roles of Travel Agents and Tour Operators:
Role of TAAI AND IATO TAAI brings in changes in the travel trade sector in the country.
TAAI has been working on delivery of highest service, build trust and credibility in the
marketplace and apply technical skills. Indian Association of Tour Operators (IATO) was
established in 1982 in New Delhi. It has more than 4000 members comprising active, allied
and associate. It maintains connections and constant interaction with other Tourism
Associations in US, Nepal and Indonesia. Indian travel agents and tour operators regularly
present the issues like clogged and creaking airports, ageing air traffic control systems and a
chronic hotel shortage, combined with slow and cumbersome bureaucracy.
Responsibilities of a tour operator
 deciding how many holidays to sell each season and the resorts/countries to use
 visiting resorts to ascertain accommodation quality and suitability
 liaising with coach operators, airlines, hoteliers and resort reps
 agreeing service levels, contracts and costs
 confirming customer names with airlines/hotels
 collecting, evaluating and responding (as appropriate) to customer feedback
 using market research information to guide decisions
 producing brochures and internet-based information
 providing pricing information
 marketing holidays to clients via travel agents, websites, brochures and television
advertising

Qualifications and training required

A degree is not a standard formal requirement for this role, though it may be an
advantage. Degrees in leisure, travel, tourism, management, marketing, IT,
business, languages or hotel and catering management are particularly likely to
be relevant. Relevant professional or vocational qualifications, such as NVQs
and HNDs, may also be beneficial(Budeanu, 2005).
Pre-entry experience gained working with the general public or within the hotel,
tourism or travel trades (particularly overseas) will strengthen your applications
and improve your chances. It may be possible to start work in a tour rep, tour
guide or travel agent role and then move on to a tour operator position.

Important skills for tour operators

 A demonstrable interest in travel
 Knowledge of key holiday destinations
 Foreign language skills
 Excellent interpersonal skills
 Communication skills
 Customer service skills
 Organisational skills
 IT skills
 Commercial awareness
 Good time management skills.

CONCULSION
A travel agent is a business that sells travel related products and services to end-user
customers on behalf of third-party travel suppliers, such as airlines, hotels and cruise lines.
Customers of travel agencies include tourists and business travellers. Some agencies also
serve as general service agents for foreign travel companies in different countries. On the
other hand, a tour operator is a company which specializes in the planning and operation of
pre-paid, pre-planned vacations and makes these available for tourists either directly or
through the retail travel agency. Thus, there are ample opportunities for those who are
planning to enter this vital sector of the tourism industry. Even many of you have huge
employment opportunities right in your own location if your area is a tourist destination.
 References

Budeanu, A. (2005). Impacts and responsibilities for sustainable tourism: a tour operator’s

perspective. Journal of Cleaner Production, 13(2), 89–97.

https://doi.org/10.1016/j.jclepro.2003.12.024

Khumalo-Ncube, S., & Motala, T. (2021). Hotel Booking Website Quality, Travel Agent

Satisfaction and Purchase Intention. African Journal of Hospitality, Tourism and

Leisure, 10(10(6)), 1932–1943. https://doi.org/10.46222/ajhtl.19770720.201

Marin-Pantelescu, A., Tachiciu, L., Capusneanu, S., & Topor, D. I. (2019). Role of Tour

Operators and Travel Agencies in Promoting Sustainable Tourism.

Www.amfiteatrueconomic.ro, 21(52), 654. https://doi.org/10.24818/ea/2019/52/654

Pinto, I., & Castro, C. (2019). Online travel agencies: factors influencing tourist purchase

decision. Tourism & Management Studies, 15(2), 7–20.

https://doi.org/10.18089/tms.2019.150201