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Tourism Business
- The first travel agency was founded in 1920 in Mumbai, India to cater to domestic travel needs. Over time, travel agencies expanded their services to include international tours, ticket booking, hotel reservations, and package tours. - Travel agencies act as intermediaries, selling travel products and services on behalf of airlines, hotels, tour operators and other suppliers. They operate on a commission basis, earning a percentage of the sales they make. - Common commissions include 5-10% for domestic airline tickets, 6-9% for international flights, 10-20% for hotels, and 10-15% for cruise lines and outbound tours. This document outlines the history and evolution of the travel agency business model.
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- 2. Introduction R'tist@Tourism, Pondicherry University •The Indian Travel Agencies like Jeena & Co., Lee & Muirhead India Pvt. Ltd, and Jamnadas & Co. Ltd at Bombay also operated inbound and outbound tours for Indian and Foreigners. In 1920, the first travel agency was founded in the • Jeena and Company was founded as the first travel agent in 1920 in Mumbai to cater to the domestic travel needs. The company made use of the vast opportunities of the growing business and ventured into the cargo and courier business. • Subsequently after, it entered into different components of travel related services like ticket booking, hotel reservation, package tour, transport arrangements, etc. The company along with other travel agents made much progress in the post independence period. 2
- 3. Travel Agency • Travelagency is a firm or corporation qualified to provide tours, cruises, transportation, hotel accommodation, meals, transfer, sightse eing and other elements of travel to the general public as form of services and finally acts as a retailer. This is a business organization that is collectively set up to accomplish missions, goals and purposes within a formal structure. All management theories are applicable to manage the complex business networks. It requires much coordinated activities like division of labour, hierarchical authority and responsibility. • In addition to dealing with ordinary tourists most travel agencies have a separate department devoted to making travel arrangements for business travelers 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. Tour Operator • An organization, firm or company who buys individual travel components, separately from different suppliers and assembles them into package tour by adding certain value which is sold with their own price tag to the public directly or through the middlemen (Travel Agent) is called a tour operator. Tour operator is a professionally managed company which has much expertise and experience in the planning and operation of prepaid and preplanned vacation packages for the general public directly or through retail travel agents. • The terms tour operator and tour wholesaler are often used interchangeably, and are treated here as having identical meanings R'tist@Tourism, Pondicherry University 3
- 4. Difference between TO& TA Tour Operator • It is a wholesaler • It is principal agent or foreign travel agent • amend the tour itinerary and program • delightful and value added tour itinerary • located in the mega cities • international transfer from hotel to airport and vice versa • Adequate excursion tours • It accepts foreign currency • generating new ideas and attractions in the package • member of international bodies like PATA and ASTA Travel Agent • It works as a retailer and sells package tours on behalf of the wholesaler • It is an intermediary between tour operators and tourists • It follows tour itinerary • sightseeing tours and excursion tours, airport arrival and departure transfer, check in and check out time in the hotel • It acts as a local agent to confirm and reconfirm the services • Problem related to the tours is solved by the travel agents • member of national bodies like TAAI and IATO • terms and conditions for commission with principal suppliers R'tist@Tourism, Pondicherry University 4
- 5. Origin • Cox &Kings is oldest travel agency in the world • modern travel agency first appeared in the second half of the 19th century • Thomas Cook, in addition to developing the package tour, established with the Midland Railway • British pioneer travel agencies were Dean & Dawson, the Polytechnic Touring Association and the Co- operative Wholesale Society. • Originally, travel agencies largely catered to middle and upper class customers, but the post-war boom in mass- market package holidays resulted in travel agencies on the main streets of most British towns, catering to a working-class clientele, looking for a convenient way to book overseas beach holidays. R'tist@Tourism, Pondicherry University 5
- 6. Operations • travel agency'smain function is to act as an agent • selling travel products and services on behalf of a supplier • unlike other retail businesses, they do not keep a stock in hand • Sell the inventory got on discount and acquire profit • include the sale of in- house insurance, travel guide books, timetables, car rentals, and dealing in the most popular holiday currencies Commissions • operate on a commission- basis • compensation from the airlines, car rentals, cruise lines, hotels, railways, sightse eing tours, tour operators, etc • commission consists of a set percentage of the sale. • most airlines pay no commission at all to travel agencies • In some parts of asia its zero % commission R'tist@Tourism, Pondicherry University 6
- 7. • HOTELS 10-20 % some accommodation providers pay more than 20 per cent. Some pay room and food free for group leader. Some do not pay at all. Some pay overrides also. National and international chain hotels and resort companies pay commission regularly. They usually negotiate the two commission rates for peak and off peak period. • FOOD 10-20 % Some pay free meals and breakfast to the group leaders, escorts or guides. Sometime, commission is not paid if it is not a substantial business. • ENTERTAINMENT 10 % Some negotiate with the tour operators free ticket and some times do not pay also if it is not booked in advance. • CAR RENTALS 5 – 10 % It is very standard. The average commission is 5 %. Companies also offer cash and free transport for familiarization trip of the principal agents. • TOURS 10- 20 % The common practice of commission amount is 10 %. Some rewards the retail agent over the total business or target business. Some also provide free package tour to the agents and its staff and family members. • CRUISE LINES 10- 15 % The average commission is 10 % but in certain cases, bonuses and overrides are possible based on business performances. • AIRLINES DOMESTIC 5 % It is very standard in case of accredited Passenger Sales Agent (PSA). Now-a- days, airlines provide them cash return on each ticket unlike the fortnightly commission procedure. More online bookings are convenient to the travel agents. Tour operators get special commission as per the contracts and adequate free tickets for company shareholders, staff and family members. • INTERNATIONAL 6- 9 % International flights offer heavy discount to the tour operators other than the usual discounts. Airlines prefer to deal with tour operators for bulk sale of seats. This practice is certainly well accepted across the airlines. R'tist@Tourism, Pondicherry University 7
- 8. • CHARTERS 10-15 % There are principal tour operators which lease out the air craft or work on commission basis. The average commission is 10 %. Other negotiable offers are also attached with the charter business. • BUS TOURS 10 % It is mostly uniform. Some also pay more than the usual commission in the off season and free trips for familiarization tours. • RAIL10 % Indian rails do have much provision to offer commission in cash to the tour operators. In most of AMTRAK Foreign Rail & Eurail Pass the cases, tour operators book the circular tickets in order to get the tickets booked in a reasonable amount as per the Indian rail rules. On the contrary, Railways in North America and Europe provide varied schemes for availing commission by booking the tickets other than the standard commission amount. • Airlines domestic 5 % • International 6- 9 % • Bus tours 10 % • Rail 10 % • Selling cruise lines tickets 10- 15 % • Hotels bookings 10 -20 % • Car rentals 5 – 10 % • Outbound Tours 10- 20 % R'tist@Tourism, Pondicherry University 8
- 9. Types of agencies UK –multiples, – Miniples – independent agencies. • The former comprises a number of national chains, often owned by international conglomerates, like Thomson Holidays, now a subsidiary of TUI AG, the German multinational. • It is now quite common for the large mass-market tour companies to purchase a controlling interest in a chain of travel agencies, in order to control the distribution of their product. • (This is an example of vertical integration.) • The smaller chains are often based in particular regions or districts In the United States – mega, – regional, – consortium – independent agencies. • Independent agencies usually cater to a special or niche market, such as the needs of residents in an upmarket commuter town or suburb or a particular group interested in a similar activity, such as sporting events, like football, golf or tennis. two approaches of travel agencies • One is the traditional, multi- destination, out-bound travel agency, based in the originating location of the traveler, is usually a larger operator like Thomas Cook • other is the destination focused, in- bound travel agency, that is based in the destination and delivers an expertise on that location, is often a smaller, independent operator.R'tist@Tourism, Pondicherry University 9
- 10. The internet threatto travel agency • general public access to the Internet • travel companies began to sell directly to passengers • airlines no longer needed to pay the commissions to travel agents on each ticket sold • Since 1997, travel agencies have gradually been disintermediated • by the reduction in costs caused by removing layers • travel agencies have developed an internet presence of their own by creating travel websites • major online travel agencies include: Expedia, Voyages- sncf.com, Travelocity, Orbitz, CheapT ickets, Priceline, CheapOair, and Hot wire.com • Travel agencies also use the services of the major computer reservations systems companies, also known as Global Distribution Systems (GDS), including: SABRE, Amadeus CRS, Galileo CRS and Worldspan • Travel agents have applied dynamic packaging tools to provide fully bonded (full financial protection) • All travel sites that sell hotels online work together with GDS, suppliers and hotels directly to search for room inventory • online travel websites that sell hotel rooms are Expedia, Orbitz and WorldHotel- Link. • comparison sites, such as Kayak.com, TripAdvisor and SideS tep search the resellers site all at once to save time searching R'tist@Tourism, Pondicherry University 10
- 11. • Nature ofActivity • Inbound – feature holidays to this country • Outbound – feature holidays to other countries • Domestic – specializing in the country where they are based in • Specialist – feature a specific type of holiday or destination • Independent-owner-managed, usually specialized in specific holiday or destination promotion. • Integrated – large operators who have taken over others • Mass-market – large, well known, key operators Functions carry out market research • contract suppliers (purchase components) • cost the package • market and sell the package • take reservations • administer the holiday pre-departure • operate the holiday from the UK and in resort • employ overseas staff to ensure the smooth running of the holiday offer post-holiday customer care • relationship with principals (transport, accommodation and ancillary services) and retail sector (travel agents) • numbers of tour operators; dominance of the sector by a few operators and their market shares • impact of horizontal and vertical integration the structure of the key integrated players, their branded products, principals and retail outlets direct sell operators • Mass market vs. specialized operator trade organizations (Indian Association of Tour Operators and Travel Agent associations of India. R'tist@Tourism, Pondicherry University 11
- 12. R'tist@Tourism, Pondicherry University Functionof Travel Agency Travel Insurance Personal Baggage Tour Foreign Currency MICE activities entertainment, Cultural Handling agency for the tour wholesalers Booking, confirmation and reconfirmation of hotels rooms, Airline ticket, train, bus, cruise line reservation and reconfirmation Tour Itinerary, packaging & costing Liaison with providers Market Research Costing & pricing Promotion of package tour Executive tours Travel information Counseling Immigration Passport Visa Custom Clearance Health certificate Landing permits certificate 12
- 13. R'tist@Tourism, Pondicherry University Foreign TourOperation Companies India as destinations SITA as ground operator Goa, Shimla, Agra, Mumbai, Kolkatta, Jaipur, SikkimFigure- 1 FLOW OF PACKAGE TOUR BUSINESS THROUGH VARIOUS STAGES 13
- 14. R'tist@Tourism, Pondicherry University Accommodation Services Carriers Tour operators TravelAgent Customers Sales of goods/ services Arranging a sale for commission DOMINANT ROLES OF TOUR OPERATORS Figure - 1 14
- 15. Travel Trade Intermediaries TravelAgency Tour Operators Retail Wholesale Inbound Tour Operators Outbound Tour Operators Domestic Operators Ground Operators Figure-2 Types organization in Modern Travel Trade business 15R'tist@Tourism, Pondicherry University
- 16. R'tist@Tourism, Pondicherry University Shareholders Boardof directors MD President General Manager Finance Controller Chief Executives Heads of various Departments Tour Research & Planning Division Travel & Tour Division Marketing & Sales Division Destinations Service Division Human resource Development Finance & Accounts Transport Department Conferences & Convention Dept. Deputy Mgr or Assist Mgr Deputy Tour Mgr Deputy Marketing Manager Deputy Manager Deputy Manager Deputy Manager Deputy Manager Deputy Manager Executives Tour Executives (Inbound & Outbound00 Sales Manager Assistants Assistants Assistants Assistants Assistants Assistants Tour Assistants Advertising Manager Tour & Travel Booking Assists PRO Assistant Tour & Travel Booking Assists A Typical Large scale Travel Agency & Tour Company 16
- 17. R'tist@Tourism, Pondicherry University Linkageof profit sharing between tour operators and principal service providers Bookings, Cancellation, Revenues, Performances Flight Times, tariffs, Availability, Commissions, Confirmations Location, Room Availability, Rack Rates, Commission levels Airlines Tour Operators Travel Agents Hotels Information Revenues& Information Revenues& Information Information Information Revenue Information & Commission 17
- 18. Ground Operator • itis necessary for the company to assess various pertaining factors before the selection of a ground handling operators. • Convenient of Location • Size of business • Professional staff • Length of business • Reputation and membership with International and national travel and tourism associations. • Credit facilities. Reasons for Selecting Ground Operator • tour companies rely on the ground operators or handling agents at the destinations for the main reasons as follows; • Introduction of new product or plan to promote these exotic destinations. • Lack of control over the government regulations. • Lack of personal contract • Language of barrier. • Unfeasible to maintain own branches at each destination. R'tist@Tourism, Pondicherry University 18
- 19. Services Offered byTO • Airport and hotel transfer • Arrangements for traditional reception at the arrival points. • Experienced and professional tour guides, escorts, interpreter and tour managers. • Excellent and personalized services at destination. • Coordination with local tourist organizations at destination. • Domestic and international air travel. • Rail bookings in India, Europe, America & Japan. • Hotel reservation • Car rental. • Travel documentation. • Airport facilitation. • Foreign exchange. • Overseas travel insurance. • Conference and seminar management. Business/trade delegations. • Arrangements of luggage transfer in the airport and railway stations. • Arrangements of guided sightseeing tours. • Options and selection for worldwide destination • Exhaustive itinerary planning. • Appropriate hotel selection & reservation. • Meeting, conference and meeting arrangements. • Exhibition and factory Visits. • Theme parties, events & sightseeing. • Air tickets & travel documents like passport, VISA, health certificate and currency, insurance and permits for entry into the restricted areas. • Foreign Exchange & Travel Insurance. Trade Fair/Exhibition visits. • Implant Operations - your in-house travel consultant equipped with CRS system and satellite ticket printer. • Incentive travel in India and Worldwide. R'tist@Tourism, Pondicherry University 19
- 20. Special interest services •Ayurveda and Health • Archaeology and historical sites • Adventure and ecotourism sites • Buddhism and Jainism ancient religious sites. • Special cuisines at each place. • Desert and jungle safari tour. • Arrangement of comfortable entry and visit of fairs and festivals venues. • Arrangement of short trips for shopping and exhibitions grounds. • Making the provision of equipments for sports and games (Golf, winter sports and water sports.) • Provision for scholarly interpretation of objects with the help of experts at the museums • Arrangements for host community interaction. • Organizing special cultural programmes in the palaces ( Rajasthan and Gwalior) • Adequate provisions for maintaining the first aid facility in the tour. • Special amenities for the tourists in the train journey. ( Palace on Wheels, Royal Orient, Fairy Queen and Deccan Odyssey)R'tist@Tourism, Pondicherry University 20
- 21. Distribution networks oftour operation business R'tist@Tourism, Pondicherry University Actual Tourist Potential TouristTour Operator Approaches Principal supplier Transport operators Airlines and Charter flight companies Cruise Line Companies Railways & Car Rental Companies Hotels Event Managers Processing of package tours Travel agentsEnd users (Cents) Direct Selling Internet 21
- 22. Linkage of profitsharing between tour operators and principal service providers R'tist@Tourism, Pondicherry University Bookings, Cancellation, Revenues, Performances Flight Times, tariffs, Availability, Commissions, Confirmations Location, Room Availability, Rack Rates, Commission levels Airlines Tour Operators Travel Agents Hotels Information Revenues& Information Revenues& Information Information Information Revenue Information & Commission 22
- 23. R'tist@Tourism, Pondicherry University STRATEGICALLIANCE WITH THE SERVICE PROVIDERS Support service private service Producers/ Principal Suppliers Support Services Pubic Sector Guiding Services Travel Insurance Travel Finance Travel press Marketing Support Guides and Tine stables Publications, training, etc. Carriers Accommodation Attractions Manmade Air Transport Sea Transport Rail Transport Road Transport Hotels, Motels Guest Houses Villas Apartments Holiday Homes Holiday villages Holiday camps Ancient monuments Ancient centre Theme Parks Catering National Tourism Office Regional Tourism Office Education & Training Visa & Passport service Tour Operators and Brokers Travel Agent Tourist Figure-2 23
- 24. R'tist@Tourism, Pondicherry University Professional Networksof Travel Agency Surface Transport Cruise Line Hotels motels Resorts Others Airline Industry Tourism Associations Cultural and Entertainment organizations Dept of External Affairs National & State Tourism Depts. Educational Institutions Foreign Principal Agents Banking Institutions Insurance Companies Tour Wholesalers 24
- 25. Tourism companies • IRCTC •Thomas Cook • Cox & Kings • SOTC • Orbitz • SITA R'tist@Tourism, Pondicherry University 25
- 26. Indian Railway Cateringand Tourism Corporation • IRCTC is a subsidiary of the Indian Railways that handles the catering, tourism and online ticketing operations of the railways in 2002 Services • Catering – Catering Policy 2010 (by Mamata Mukharjee) Catering services provided by IRCTC were hand over to INDIAN Railways. Now IRCTC is in charge of catering services on Few trains such as All Duranto Exp, Frakkha Exp, Maitree Express( Train between INDIA and BANGLADESH),Kandhari Exp and some Rajdhani Exp rest all of train operated by Zonal Railways railway stations across India. – However IRCTC still operate Janaahar at railway station. – IRCTC also started NRC project(NON RAILWAY CATERING) under which cafeteria were operated in many Indian Ministries and Institutes. • Online ticketing – known for changing the face of railway ticketing – pioneered Internet-based rail ticket booking through its website, as well as from the mobile phones via GPRS or SMS – cancellations or modifications can also be done online – In addition to E-tickets, IRCTC also offers I-tickets that are basically like regular tickets except that they are booked online and delivered by post. – The Tickets PNR Status is also made available here recently. – Mumbai's suburban railway can also book season tickets through the IRCTC website. – IRCTC has also recently launched a loyalty program called "Shubh Yatra" for frequent travellers, discounts on all tickets booked round the year by paying an upfront annual fee. – launched flights and hotels booking facilities which added to their line of online reservation services • Tourism – organizes budget and deluxe package tours for domestic and foreign tourists, Bharat Darshan – Luxury tourism packages are also available, that involve special luxury trains such as: • Palace on Wheels • Royal Orient Express • Golden Chariot • Deccan Odyssey • Royal Rajasthan on Wheels • Buddhist Circuit Train • and IRCTC is a partner in the Maharajas’ Express operation. • log on to railtourismindia.com and book Rail Tour Package, Holiday Package, Hotels, Cabs, Tourist Trains online. • adventure tourism packages that include water sports, adventure and wildlife treks, etc. A provision for customising tours as per specific requirements is also an added attraction. R'tist@Tourism, Pondicherry University 26
- 27. Awards and achievements •IRCTC website had become the largest and the fastest growing e- commerce website in the Asia-Pacific region, with about six lakh registered users in 2003 – Awarded the National Tourism Award of Excellence by Ministry of Tourism, Govt. of India. – Awarded the National Award for E-Governance, 2007-08 jointly by Department of IT, Govt. of India and Govt. of Haryana. – Awarded the Genius of the Web Award 2007 for being the "Best E- Governance PSU Site" by CNBC. – IRCTC Tourism Unit of West Zone declared winner for the category Best Value Leisure Product in Travel and Tourism Fair of India (TTF & OTM 2008) held in Mumbai from 9 to 11 February 2008. – Won National award for E-Governance for being "Best Citizen Centric Application" for the year 2007-08. – IRCTC Tourism Unit declared winner for the category Most Innovative Product in Travel and Tourism Fair of India (TTF & OTM 2007) held in Mumbai from 10 to 12 February 2007. – Won CSI-Nihilent E-Governance award for "Best E-Governance Project" in 2007. – Won the ICICI Bank Retail Excellence Award in 2005. – Won Path Breaker Award from Dataquest in 2003 and 2004. – Awarded the Mini Ratna Category-1 by Ministry of Railways, Govt. of India R'tist@Tourism, Pondicherry University 27
- 28. Travel and TourismFair(TTFOTM) TTF • is India’s leading exhibition for the travel & tourism industry. Since 1989, it provides an annual opportunity for organisations from India and abroad to showcase their products and services to a large cross-section of the travel trade industry and consumers across major markets in India. • With more than 1500 Exhibitors from 61 countries and 35 Indian States / UTs, an ever increasing number of foreign country representations, and a committed visitorship of more than 186,000 visitors, TTF together with OTM is the largest network of Travel Shows in India. • OTM is India’s leading travel show focused on Outbound travel. It provides an annual opportunity for organizations from around the world to showcase their products to a large cross-section of travel trade and consumers in all major target markets in India, just before the peak outbound season. 2012 – Mumbai February 17, 18, 19 Bombay Exhibition Centre, Goregaon (East) – New Delhi February 24, 25, 26 Pragati Maidan. • Concurrent with TTF • Endorsed by PATA • Organised by FAIR FEST MEDIA ltd R'tist@Tourism, Pondicherry University 28
- 29. ThomasCook • Thomas Cook(22 November 1808 – 18 July 1892) of Melbourne, Derbyshire, England • with Midland Counties Railway, he arranged to take a group of 540 temperance campaigners from Leicester Campbell Street station to a rally in Loughborough • During the following three summers he planned and conducted outings for temperance societies and Sunday-school children. • In 1844 the Midland Counties Railway Company agreed to make a permanent arrangement with him provided he found the passengers. • On 4 August 1845 he arranged accommodation for a party to travel from Leicester to Liverpool • In 1846, he took 350 people from Leicester on a tour of Scotland, however his lack of commercial ability led him to bankruptcy • He persisted and had success when he claimed that he arranged for over 165,000 people to attend the Great Exhibition in London • Cook established 'inclusive independent travel', whereby the traveller went independently but his agency charged for travel, food and accommodation for a fixed period over any chosen route. • Such was his success that the Scottish railway companies withdrew their support between 1862 and 1863 to try the excursion business for themselves. • In 1865, the agency organised tours of the United States, picking up passengers from several departure points. • A round the world tour started in 1872 • In 1874, Thomas Cook introduced 'circular notes', a product that later became better known by American Express's brand, 'traveller's cheques • By 1888, the company had established offices around the world R'tist@Tourism, Pondicherry University 29
- 30. Cox & Kings •longest established travel company in the world, its history stretching back to 1758 when Richard Cox was appointed as regimental agent to the Foot Guards. • Cox & Kings is now an independent tour company with offices in the United Kingdom, India, the United States and Japan. Its global headquarters are in London • Cox was born in Yorkshire in 1718 • 1740s, went on to become the Colonel of the First Foot Guards • The company set up five branches in India between 1905 and 1911 R'tist@Tourism, Pondicherry University 30
- 31. Airline ticketing R'tist@Tourism, PondicherryUniversity 31
- 32. Flying time – Thedifference between the take off time and the landing time MPM & TPM – MPM Establish the maximum permitted mileage between the fare construction points of the fare component following the same global direction as that used in the NUC above. – TPM Add up the ticketed point mileage of each sector and compare the total TPM to the MPM Rounding up – LCF Round the resulting local currency fare and take note of required number of decimal units for the currency. I TINERARY PREPARATION – Available flights – Flight timings – Passenger timings – To and fro – Booking a ticket accordingly R'tist@Tourism, Pondicherry University 32
- 33. Travel Information Manual(TIM) • TIM (Travel Information Manual) is the world's leading source for information on air travel requirements. Millions of passengers find their way to final destinations time after time with the TIM. The never-ending movement of people and commodities continues to run smoothly when players are informed of TIM's up-to-date country entry requirements worldwide. • Key Benefits • The TIM is a must for all who are involved in the travel industry. This unique manual lists rules and regulations for more than 216 countries on subjects such as: • Passports • Visas • Health information • Airport tax • Customs and currencies • Latest news • Designed for • The information found in TIM is consulted by thousands of users around the world every day, including airline offices, travel agents, corporate accounts, tour operators, GDS and government agencies. R'tist@Tourism, Pondicherry University 33
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- 35. Types of Fare •Fare – The amount charged by a carrier for the carriage of a passenger and his allowable free baggage as being applicable to the class of service to be furnished • Normal fare – Unrestricted normal fare – Restricted normal fare • Unrestricted normal fare – Or Primary normal fares – Normal fares without any restrictions – Permit unlimited stopovers and transfers – F or C or Y class fares • Restricted normal fare – Or Secondary normal fares – Have stopover and transfer conditions – Lower than primary fares – F2,P2 etc (for first class restricted fare) – J2, C3 etc (for business class restricted fare) – Y2, S2, Y11 etc (for economy class restricted fare) R'tist@Tourism, Pondicherry University 35
- 36. Special fares – Specialfares are low promotional fares that have more restrictions than the normal fares – Aim partially promotional and partially social – Restrictions in respect of • Length of stay • Advance purchase requirements • Reservations, payment and ticketing limits • Day/time of travel • Eligibility restrictions • Refundability and changeability • Types of special fares – Public Special Fares – Inclusive Tour Fares – Public Group Fares – Reduced fares for specific categories of persons – Miscellaneous Fares • Public Special Fares – Late Booking Fare • These are fares that can only be purchased at the last moment or with in 24 hrs or so of departure • Stand by, late purchase, or instant purchase fares • Can only travel if seats are empty at the time of departure • These tend to be the cheapest fare – APEX Fare • Advance Purchase Excursion fare • Restrictions on timing of purchase • Require advance reservation with advance payment , a minimum no. of days before departure • Does not allow open dated segments, all flight coupon must have confirmed reservation • Penalties for changes in booking and ticket cancellation also apply – PEX Fare • Purchase Excursion Fare • Does not have a requirement to purchase the ticket a minimum no. of days before departure • Payment of ticket up on obtaining confirmed seats • Does not allow open dated segments • Penalties for changes in booking and ticket cancellation also apply – Excursion Fare • Have duration limits as expressed by minimum and maximum stay dates • Attracts mostly vacation travelers and tourists • Usually allow open dated segments • Rebooking or cancellation penalty fees do not applyR'tist@Tourism, Pondicherry University 36
- 37. • Inclusive TourFare – Prearranged combination of air transportation and surface arrangements other than just public transportation – Arranged by Travel Agents or Tour Operators – GIT Fares – IIT Fares • Public Group Fares – Designed for group travel without land arrangements – Available when passengers travel together and have compiles with minimum group size – Common Interest Group fare – Incentive Group fare – Affinity Group fare – Non- Affinity Group Fare • Common Interest Group fare – Passengers who have a bonafide common interest by traveling together by the same routing to the same destination – Common interest must be other than qualifying for the discount • Incentive Group fare – For employees and/or dealers and/or agents of the same commercial organizations traveling under an established Incentive Travel Program • Affinity Group fare – This fare is available to members of the same organization /company/association having some affinity • Non- Affinity Group Fare – Members of a travel group who does not share a common affinity. – The pax are just assembled in order to avail the group discount • Reduced fares for specific categories – Diplomat / Govt. fare – Family fare – Military fare – Pilgrim fare – Senior Citizen fare – Students fare – Youth fare • Miscellaneous Fares – Other fares that does not fall under the above categories – Special event tour fares, triangular fares etc. R'tist@Tourism, Pondicherry University 37
- 38. R'tist@Tourism, Pondicherry University38 Fare calculation
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- 41. NOTES/EXCEPTIONS: • 1. Fortickets issued for travel commencing in Algeria/Tunisia, check identity papers of the passenger to see whether or not, s/he is a resident. Residents of these countries are quoted a lower fare level than non-residents. (See latest PAT GeneralRules book.) • 2. Additional HIP checks apply for journeys originating from India, Malawi, Western Africa, Yemen and for journeys whollybetween Kilimanjaro and Nairobi. • 3. BHC is not applicable for: – a) Journeys wholly within TC1 – b) Journeys wholly between Argentina, Brazil, Chile, Paraguay, Uruguay and TC2 – c) Pricing units wholly within Europe • 4. OSC is not applicable to/from/via USA/US Territories and for journeys originating/terminating in Canada • 5. DMC is only applicable to One Ways to/from/via Japan when the traffic document is not issued in the country from which the journey commences (Scandinavia is considered one country) For electronic tickets, the traffic document is deemed to be issued in the country in which the electronic record is established. • 6. DMC is not applicable for traffic documents issued in: – a) TC1 for journeys commencing in TC1 – b) Canada, USA/US Territories for journeys to Canada, USA/US Territories – c) Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Congo (Brazzaville), Cote d’Ivoire, Equatorial Guinea, Gabon, Guinea-Bassau, Mali, Niger, Senegal or Togo and the journey originates in these countries. R'tist@Tourism, Pondicherry University 41
- 42. • Payment modes –Direct cash – Card swipe – Online payment – cheques • Issuance of ticket – Manual ticket – Automated ticket – E- ticket – Single coupon ticket – Double Coupon ticket – Four coupon ticket – Airline ticket – Neutral ticket R'tist@Tourism, Pondicherry University 42
- 43. Cargo Handling • Baggageallowance – On the commercial transportation, mostly with airlines,the baggage allowance is the amount of checked or carry- on luggage the airline will allow per passenger. that is allowed free of charge – In 2007 with most airlines now charging for both the first and second bag. However, within Europe, and often on flights between the United States and Europe, the limit is as low as 40 pounds (18 kg) total per passenger, and many airlines do not allow passengers to exceed this amount, even with payment of a fee. – Many passengers complain about this limit, because after the typical 15-20 pounds (7–8 kg) of the suitcase itself, little room remains • Piece Concept – passengers are permitted to check two bags with a per-bag weight of up to 50 pounds (23 kilograms) for Economy Class, and up to 70 pounds (32 kilograms) for Business or First Class. – Certain airlines operating under the Piece Concept may add additional checked baggage allowance for their Elite Level fliers. – Weight restrictions are per bag, unlike the Weight Concept. • Weight Concept – each passenger is permitted to check a total bag weight in however many bags they have. Typically, Economy Class is permitted to check in up to 44 pounds (20 kilograms), Business Class is permitted to check in 66 pounds (30 kilograms), and First Class is permitted 88 pounds (40 kilograms), Unlike the Piece Concept – allows passengers to combine their bag weight into fewer bags which would otherwise be too heavy to travel under the Piece Concept • Most airlines have changed the policy and allow as of November 2009 only one bag to be checked in for free. The second bag will cost between $50-55 R'tist@Tourism, Pondicherry University 43
- 44. Accountability of baggageloss – 250,000 Francs or 16,600 Special Drawing Rights (SDR) for personal injury; – 17 SDR per kilogram for checked luggage and cargo, – 5,000 Francs or 332 SDR for the hand luggage of a traveller. • International financing instrument created in 1970 by the International Monetary Fund (IMF) to coincide with the disfavour of the US dollar as the principal currency of the world trade. • At present, one SDR is the sum of 0.6320 US Dollars, 0.4100 euro, 18.4 Japanese yen and 0.0903 pound sterling R'tist@Tourism, Pondicherry University 44
- 45. • Dangerous Goods –Class 1: Explosives – Class 2: Gases – Class 3: Flammable Liquids – Class 4: Flammable Solids – Class 5: Oxidizing Substances & Organic Peroxides – Class 6: Poisonous (toxic) & infectious substances – Class 7 : Radioactive Materials – Class 8: Corrosives – Class 9: Miscellaneous dangerous substances & articles • Cargo rates and valuation charges R'tist@Tourism, Pondicherry University 45
- 46. • Automation – Informationconcerning – Schedules – Fares – Ticket reservation – Invoicing – Electronic check • Airport procedures – Check in – Check out – Airport services – In flight services R'tist@Tourism, Pondicherry University 46
- 47. Requirements in settingup Travel Agency • SEC Registration: - Incorporation Papers/By-Laws - Capitalization, Subscribed shares, Paid-Up Shares (minimum of P .5M) - List of Stockholders & Citizenship, ther addressesm respective Community Tax Certificates and TIN - Latest General Information Sheet - Board Resolution of Authorized Signatories - Corporate Address - Appointed Corporate Treasurer-in-Trust - Bank Certificate for Corporate's paid up capital DTI Certificate of Business Registration - Certified photocopy of the Articles of Incorporation - Application Form Local Government License and Mayor's Permit - Articles of Incorporation - DTI Certificate - Barangau Clearance - Corporate Community Tax Certificate - Other Local Gov't Clearances ( employees' health certificate, ID, Barangay, Police, NBI clearances, 4 1x1 photos of all company employees, etc.) - General Liability Insurance BIR - Corpopate Registration - articles of inc - DTI certificate - Mayor's Permit & Business Licenses - Corporate Logo - Contract of Lease - Incorporators/Employess Registration and TIN - 1 pc passport size colored picture in white background - Civil registry documents; i.e. birth, marriage certificates • SSS/Pag-Ibig/Philhealth - Articles of Inc - DTI Cert - Mayor's Permit and BUsiness Licenses - BIR Registration - Employees' Alpha List, SSS number, Pag-Ibig Number, Philhealth Number DOT Accreditation Legal 1. Mayor's Permit/Municipal License 2. Business Name Certificate for Single Proprietorship 3. Articles of Incorporation/ Partnership & By-Laws for Corporation/Partnership and Business Name Certificate, if applicable. Financial 1. Latest Income Tax Return and Audited Financial Statements Physical 1. Contract of Lease of office space/Certificate of Title Other DOT Documentary Requirements 1. Application Form 2. List of Officials and Employees 3. Valid visa and labor permit for foreign nationals 4. Board Resolution/letter form owner/partners authorizing its bonafide employee to sign/file/transact business with DOT DOT Requires: - a P .5M cash revolving fund for operation - Travel and Tours Seminar of Manager/Owner - at least 1 Tourism Graduate employee Others: *You will need at least P70,000.00 to process and file these requirements, aside from the required P .5M paid up capital. **IATA/DITS Registration/Seminar R'tist@Tourism, Pondicherry University 47
- 48. • Incentives toTravel Agents – Profit sales leads to incentives – Incentive trips – Incentive family trips – Incentive lunch coupons – Reference at important destinations – VIP passes • Constraints & limitations of Travel Agents – High competition level – Element of Uncertainty – Stringent regulatory laws – Language constraint – Effect of currency exchange rate fluctuations – Relations between countries – Different interests of travelers – Fluctuations in demand R'tist@Tourism, Pondicherry University 48
- 49. Thank You ©Ramakrishna Kongalla R'tist@Tourism,Pondicherry University 49