Travel Agency

Institute of Human Resource Advancement University of Colombo Diploma in Executive Diploma in Tourism Events, Hospitality Management (EDETHM)

Academic Year 2015 / 16Presenter – A. Praveen RajSt No - EDTEHM/01/15/25

What Is a Travel Agency

• A travel agency is one 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. 

• A travel agency's main function is to act as an agent, selling travel products and services on behalf of a supplier.

• 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. 

Basic Organization StructureChairmen & CEO

Managing Director

Director / General Manager

Reservation / Travel Dep Advertising &Marketing Department

Finance Department Outbound Dep MICE DEP HR DEP

Tour Consultant

Tour Guide

Outbound

Inbound

Duties and Role of the Department

Reservation / Tour Operation Department• Offer best deals with competitive rates

• Tailor-made group programs to include original sightseeing with best value hotels as per requirements and prepare Colorful, timed and detailed itineraries

• Select Professional, knowledgeable, comprehensible and enthusiastic guides services

• Arrange Deluxe air conditioned motor coaches with professional drivers for tour as per client need.

• Follow-up enquiries, quotations, after sales, relationship building with agents

• Follow-up with destination offices related to costing, quotation, invoicing & ground handling

• Business generation responsibility for all segments. Reporting & follow-ups and do the relevant Hotel / Travel booking for the Client / Agent

Human Resources Department

• Recruitment and selection process

• Training and Development process

• Use financial management skills, such as overseeing budget

• Co-ordinate merchandising functions through retail buyers

• Research new products

Sales, Marketing & Advertising Department• Developing new business/products/services and generating new sales lead

• Responsible for sales of Travel related services to Travel Agents

• Maintain relationship with existing clients & generating new clients to develop business

• Coordination with operation team for pre sales & post sales requirement

• The targets have to be set for each segment (SBU) and have to be distributed as per agency. It has to be evaluated every quarter

• To follow up on the targets and support the agencies to reach the targets

• To circulate all promotions and tariffs if at all published

• To target markets where the company needs to build up market share

• To plan appointments before visiting outstation

Accounts/Finance Department• Maintaining and checking all books of accounts including Bank-books, General-Ledger, bank-statement, Trial-balance.

• Ensured and check all entries of system

• Preparing monthly departure wise / group wise profitability and sharing with the Management.

• Support and finish related task of accounts and monthly reconciliation of Branch, Debtor, Supplier, Bank and Head Office Accounts.

• Handling & Analyzing Accounts payable and Receivables entry with clients and conduct variance analysis.

• Maintain, scrutinize and review general ledger and prepare financial statements.

• Analyze Balance Sheet, P & L accounts and prepare Trial balance at monthly & year end.

• Control on Financial issued related to expenses, cash, and payment

Mice and Special Events Department

• Theme party & themed event organization

• Creation of team-building activities

• VIP Program development & implementation

• Custom-designed daytime activities & tours

• Award program design & organization, Stage Design, audio-visual equipment management & technical support

• Selection of room gifts, decoration & production of souvenirs

• Coordination of accommodations & in-house activities

Process Of a Travel Agency & Identifing the Expences and Income with a System Of Control

PLANNING AND DEVELOPMENT

ASSESS PREVIOUS YEARS PERFORMANCE

•Proft margins •Market position•Customet statisfaction  data •Developments in destinations 

MAKE MARKETING PLANS FOR EACH HOLIDAY SERVICE/BRAND

•Market research data •Profits and market share projections•New destinations to be launched •Prices, terms and discounts for  each brand

Make product plans for each service/brand

•What types of  services are on the market•Success rates of service types/destinations•Destination research •Policy decisions on brochure production 

Destination selection

•Profits and revenue forecasts •Natural/Cultural characteritics •Health and Safety standards•Security and infrastructure 

Incentive/education trips for : •agents and employees •Suppliers

•New destinations to be introduced •Policies for strengthening brand loyalty•Policies for strengthening supplier relationships 

01

CONTRACTING

Contract for Accommodation

4Price 4Service/brand characteristics 4Conditions for release of unsold rooms4Health and safety standards 4Insurance contacts  

Contract for Transport for traveling to and from Destinations

4Charter rights 4Distance and serving routes4Conditions for cancellations/release of unsold capacity4Insurance contacts 

Contract for transport included in package and tour

4Speed/distances involved 4Confort and convenience 4Price 4Brand/service characteristics 4Insurance contracts 

02

Contract for Supplementary Services (attractions, leisure svs, guides, instructors, etc.)

4Commission rates 4Experience, reliability, trainning4Price 4Insurance contracts 4Previous contracts 

Tender for design and printing of brochures and price lists

4Number to be printed 4Paper type and weight4Binding and packaging 4Design features 

Establishing the prices at which different holiday services will be retailed with brands

Subcontract reservations and call centre services

Complete contracts of transport, accommodation and supplementary services

•Costs of services purchased•Markup to cover overheads and profits•Overheads allocated to each services •Competitors prices 

•Experience •Language ability•Previous contracts 

•Satisfactory health and safety inspection•Price•Conditions for the release of unsold capacity

PACKAGING03

Compile and distribute customer satisfaction questionnaires

Recruit and train seasonal employees such as guides, hostesses, chauffeurs, animators, instructors, etc.

•Experience and qualifications •Language ability•Previous contracts 

Brochures on the market, storage and distribution to agents/corporate retail outlets

MARKETING / SALES AND OPERATIAON

4On time delivery4Correlate delivery quantity to sales record

Launch agency promotions, and media and trade press advertising

4Marketing objectives of each brand 4Demand and price elasticity4Strength of competitors 4Characteristics of target markets 

04

Sell Holiday packages/services • direct: retail outlets, phone, and Internet• Indirect:  Independent travel agents    

Invoice customers/ Agents 

Prepare and distribute travel documents (tickets, vouchers, travel tips)

Handling of Customer / ageny complaints

• Ensure prompt handing procedures• Type and nature of complaint• Compensation policies

Evaluation of customer satisfaction questionnaires

Appraisal of the season

• Revenues and profit• Level of customer satisfaction• Market penetration of new  services and 

brands• Supplier issues   

EVALUATION05

Income and Expenditure Of The Travel Agency Shown in a Statement Form

Revenue (+)

       01. Tour Package Income  xxx 

       02. Transport / Hire Income  ___xxx___ 

Total Income xxxx

Cost Of Sale (-)  

       01. Accommodation / Airline Ticket Payment Expense  (xxx)

       02.  Transport / Hire Payment Expense  __(xxx)__ __(xxx)__

Gross Profit ( Revenue – Expense) xxx

Other Income (+)

    Dividend Income, Interest Income, Exchange Gain  xxx

Other Expenses (-)

    Administrative Expense – (Salary, Rent, Electricity, Stationery, Etc ….) (xxx)

    Marketing Expense – (Travel/ promotion Expense, Agent Entertainment, Etc..) (xxx) ___(xxx)___

    

Nett Profit ___xxx___

Sample of Mistake on Accounts and a Control to Solve It

Client has booked a Tour Package and We have invoiced him wrongly at a higher value – (Invoice Raised)

also the client has made the payment – (Payment Receipted).

We will have to Refund the Payment

Create a Credit Note

Reduce it as Over payment at the Income Statement

Raise a Cheque to Refund the Over Payment To The Client By ( Deposit / Pay it in Hand)