TOUR OPERATIONS CYCLE

OBJECTIVES
Understand the different processes involve in creating a tour package. Learn the principles of tour costing. Compute for tour packages

TOUR OPERATIONS

Preparation and implementation of all activities within an itinerary, within a given time frame, within the estimated costs, in order to meet the expectations of the paying client.

Planning

Evaluation

Contracting

Accounting

THE TOUR OPERATIONS CYCLE

Costing

Field Operations

Quotations

Reservations

PLANNING

Setting objectives to be achieved

Customer satisfaction Destination or community endorsement Financial objectives Organizational promotion

CONTRACTING

Process of negotiating with the suppliers for the most favorable rates and conditions.

Contracted rates discounted rates from the suppliers

COSTING

Process of determining the costs of the various components, activities or services included in the tour package depending on the number of passengers availing the package.

QUOTATIONS
Cost + profit Usually prepared for ad hoc package

Prepared based on a minimum number of participants in accordance with the specific activities, inclusions and requirements of the clients Called confidential tariff which is a listing of products offered by the tour operator with the corresponding prorated cost and concession based on specific or projected number of participant

For regular packages

Boracay Package Hotel Name 3D/2N 4D/3N

Twin
Boracay Regency 8,900.00

Triple
7,200.00

Single Supp.
2,300.00

Twin
10,900.0 0

Triple
9,200.00

Single Supp.
3,600.00

La Carmela de Boracay
Two Seasons Fridays

7,900.00

6,200.00

1,400.00

9,800.00

8,200.00

2,500.00

9,000.00 8,900.00

8,200.00 7,200.00

2,500.00 11,000.00 10,000.0 4,000.00 0 2,300.00 10,900.0 9,200.00 3,600.00 0

RESERVATIONS

Process of placing advanced requests for available services at sometime in the future and obtaining confirmation of these.

FIELD OPERATIONS
The actual delivery of the services and all the activities of the travelers from the moment of arrival to the time of departure. Shows how effectively the preparations in the office have been done

ACCOUNTING
Collection of payments from clients Paying the suppliers As much as possible, this is done in advance

EVALUATION

Comparing the actual results with the objectives set during planning:
Financial results through profit or lost Customer satisfaction through feedbacks from clients

TOUR PLANNING
Developing a package that is customer focused: Client profile Destination requested or proposed Duration Category of accommodation Meal plan Sightseeing or activities requested or suggested Mode and class of transportation Ancillary services Guide and/or tour escort Number of Free-of-charge (FOC)

CONTRACTING CONSIDERATIONS
Class/Type of Service/Room Taxes, Insurance Fees and Service Charge Applicable Concessions Validity of the Contracted Rates Reservation Procedures and Conditions Cut Off Period Deposit Payment Form of Payment/Credit Line

COSTING A TOUR PACKAGE

The cost of a package is always on a per person basis Types of Cost in a Package

Fixed Costs remains constant regardless of the numbers of passengers Variable Costs - depends on the number of projected or proposed participants

VARIOUS COMPONENTS OF A PACKAGE

Transportation

Cost by air, sea or land from origin to destination and vice versa Transportation cost by scheduled air, sea or land transportation companies are always based on a per person fare Chartered transportation on the other hand is pro-rated

PRO RATED COST

The total cost of the vehicle is divided into a pre determined number of passengers, not exceeding the vehicles capacity and within its breakeven load factor 50%-60%.

EXAMPLE
The regular fare for Manila Baguio City via Victory Liner is PHP495.00 per way and its capacity is 50 pax. If a group of 40 persons chartered the bus going to Baguio and its total cost is PHP12,000.00 per way, how much will be the cost of each passenger?

TRANSFER COSTS
Cost of transportation to and from a destinations getaway (airport, seaport or bus terminal) to the lodging facilities Can also be from one point to another in the destination Always prorated except if the transfer is by regular airport shuttle Baggage handling fee to porters are not usually included

SIGHTSEEING TOURS

Combined cost of the following:

Transportation within the sites to see Entrance fees or cost of the activities Cost of snacks and/or meals Cost of guides services including guides transportation, meals and accommodation if necessary.

ACCOMMODATION
Cost of lodging and meals served within the accommodation facility Depends on the number of persons occupying the room

COMPUTING FOR ROOM RATE

Twin or Double

Shared by two people Cost is divided by 2 Example: Twin Room Cost is USD 48.00 per night The cost per person is USD 24.00

COMPUTING FOR ROOM RATE

Single

If a person doesnt want to share a room, there is a single supplement charge representing the difference between a half-twin and a single occupancy room. Example: Single room rate at Hotel La Corona is USD 42.00 USD42.00 USD24.00 = USD 18.00 The single supplement is USD18.00

COMPUTING FOR ROOM RATE

Triple
Cost of a twin room plus extra bed divided by 3 persons. Example: Extra bed in Hotel La Corona is USD 12.00 USD48.00 + USD 12.00 = USD 60.00 USD 60.00/3 pax = USD 20.00 Triple rate is USD 20.00 There is a triple reduction of USD 4.00

A rule of thumb, in most cases, the more persons use the room, the lower the price will be.

MEALS
Meals in accommodation establishments are always based on fixed cost Outside meals are usually less expensive. However the cost of transportation to and from the hotel may increase its price.

TOUR ESCORT
Cost of in the accommodation, transportation, meals, tours of the person accompanying the group from origin to destination and vice versa. Apply all applicable concessions Always pro rate

CONVERTING INTO PHILIPPINE PESO

Currency fluctuates according to the economic conditions of the origin and destination countries. Allow a small allowance for currency fluctuation.