Tour Operators' Main Functions

EA MENDOZA
Travel Management Department
College of Hospitality and Institutional Management
Our Lady of Fatima University Valenzuela
Week 11 – TOUR
OPERATORS AND THE
TOUR PACKAGES
© Contents are from Chapter VII of Travel and Tour Operations
in the Philippines, Bienvenido Claravall (2008).

•After studying this chapter, you should be able to:
•Understand the functions of a tour operator;
•Describe criteria used to differentiate the different types of
tour operators;
•Explain the components of each type of tour packages;
•Describe the sequence in assembling the tour packages of
each type of tour operator
•Explain how and why our packages vary; and
•Differentiate the different types of sightseeing tours
•Any TMC/travel agency that desires to expand its scope of
services will undoubtedly branch out to tour packages and
the operation of tours – whether outbound, inbound,
domestic or local tours.
Learning Objectives
Tour Operators and Tour
Packages
• Learning Objectives
• The Tour Operator
• Organization of a Tour
Department
• Set-up of a Tour
Department
• Function of a TO
• Sales and Revenues of a
TO
• Characteristics of a TO
• Tour Components
• Tour Packages
• Tour Package Variables
• Types of Sightseeing
Tours

In the Philippines, Tour Operators are TMCs/travel
agents who expand their product range by setting up
a tour operations department. This department is
tasked to package as one product. It develops and
assembles well-made tour packages that are offered
to the travellers through other TMCs/travel agencies.
In order to make these packages attractive to the
travellers, a tour operator’s product research and
development section is constantly on the lookout for
new destinations and often consults the TMCs/travel
agents for relevant in-puts.
The Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

As an assembler of services, a tour operator
acts as an intermediary between the suppliers of
travel services and the traveling public. It
contracts transportation services for access,
accommodation establishments for lodging and
meals, entities that provide attractions and
activities and tour guides.
A Tour operator contracts the separate travel
components and combines these into a single tour
package.
The Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The ideal organizational setup of the tours department
must be developed along the concept that tour operations
involve both office activities or office operations and field
operations- one should complement the other in a manner that
the areas of responsibility are clearly defined.
On the office side, the main activities consist of
contracting rates, terms and condition with the suppliers
and tariff costing , the calculation of rates per service,
including those for regular tour packages. These are yearly
activities handles by the tour operation manager. The day-to-
day activities include preparing quotations for ad hoc
requests and reservations defined as the advance requests
for space or services and obtaining confirmations .
Organization of a Tour Department
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

On the field side, the main activities consists of
meeting/sending off clients referred to as meet and assist
and overseeing the actual delivery of services purchased,
known as the monitoring field operations
The tours department manager oversees both activities, but
the respective supervisors are responsible for each activity.
The key players of the Tours Operation Department are: the
manager, the operations supervisor overseeing the
quotations officer, the reservations officer and the
messenger; and the field supervisor overseeing the tour
coordinator and the courier ticketing.
Organization of a Tour Department
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Overview of the Set-up of a Tours
Department
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Reporting directly to the Tours Department manager through the operations
supervisors, the quotation officer’s duties and responsibilities are as follows;
•Services all quotation requests by developing an itinerary and assembling
all the required components and costing same;
•Prepares correct quotations;
•When the acceptances is received reconfirms the arrangements with the
client;
•Prepares all the supporting documents for the clients, such as the
descriptive itinerary maps and hotel brochures.
•Receives, logs and actions all request;
•Keeps abreast of developments in the field by coordinating with the field
supervisor;
•When the acceptance is received requests the reservations officer to
process all necessary reservations
•Acts as backup to the operations supervisor;
•Performs other duties as required;
Quotation Officer
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Reporting directly to the tours department
manager through the supervisors, the
messenger’s duties and responsibilities
are:
•Efficiently and reliably provides delivery
services for tour operations department
in the shortest possible time;
•Acts as the backup for the courier and
•Performs other duties as required.
Messenger
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Reporting directly to the tours department manager through the field operations
supervisors, tour coordinator’s who may also be designated as the airport
representative) duties and responsibilities are:
•Meets and assists guests upon arrival, and provides send-off assistance and
airline/ship group check-in upon departure.
•Accompanies parties in transit from the gateway to the hotel to ensure a safe
and unhindered arrival.
•Coordinates check-in/check-out procedures at the hotel.
•Assists tour guide in generating additional revenues by selling optional tours to
the clients.
•Reconfirms connecting/onward reservations on domestic/international flights or
shipping/bus lines, for and in behalf of clients.
•Supervises baggage handling whenever required.
•Establishes good professional relationships with hotels and the drivers.
•Arranges, if necessary, alternative facilities
•Ensures parties have satisfactory transport, meals and hotel facilities as
arranged.
•Performs other tasks as required.
Tour Coordinator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The courier acts as a backup to the tour coordinator/airport rep.
in particular when organizing and handling correct baggage
transfers both at the gateway (airport, pier, or bus station) or the
place of lodging The duties and responsibilities are as of
follows:
•Efficiently provides support services for all field staff – tour
coordinator, guide and/or escort
•Backs up the tour coordinator/airport representative, in
particular in the handling of luggage – pickup and delivery;
•Ensures that land transportation equipment is on time and in
working order;
•Assists in the reconfirmation of connecting/onward
reservations on domestic/international flights and
•Performs any other task as directed
Courier
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Industry practice would seem to suggest
that tour guides, particularly those employed
regularly with tour operators are required to
perform tour coordinator and airport
representative duties in addition to the regular
functions of tour guiding.
The tour guide is responsible for the
delivery of the services is normally a freelance
and is not an employee of the tour operator.
Tour Guide
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ tour operator’s main functions are:
1. Conceptualizes plans and develops tour packages. Tour
operators (TO) conceptualize, plan and develop tour packages
that meet the needs of a specific client r address the perceived
needs of a target market. In the former, the TO plans and
develop a tour package based on a set of specific given provided
by specific client. These givens include the number of
participants, the duration of the package, the preferred
destinations, the category of hotel desired and the like. In the
latter, the TO analyses the needs of a target market and
determines the suitability of a destination, a hotel category, the
duration of the package and so on and so forth. In other words
the TO does not exactly know who will purchase the package,
unlike with the former, which is tailor-made to a set of
specifications.
Functions of a Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

2. Negotiates with suppliers of travel services. An essential
ingredient of tour packaging is having access to
negotiated rates from travel suppliers that are more
competitive than retail prices. These can be negotiated on
the basis of the TO’s production track record, the market
potential of the package being developed or the clout or
influence of the negotiator. Another essential ingredient
is having special terms and conditions with the
suppliers. This mean not having to pay deposit payment
to receive confirmation of reservations, having seat or
bed allocation, and reasonable cut off dates among
others.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

3. Assembles and integrates the various travel components
into a single tour package. As an assembler of travel
services, a tour operator acts as an integrator. It contracts
the transportation services, such as airlines, bus/car
operator, shipping lines; the hotel for lodging and meals;
restaurants and night clubs for entertainment and tour
guides. The TO is virtually the nut that keeps al the bolts
suppliers together “ tour operator contracts the most
suitable or competitive travel components of
transportation, accommodations and other services and
combines these into a single tour package that is more
competitive than when each service is purchased
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

4. Delivers the tour package. The TO deliver the
travel services components of the tour package
by operating worry-free and secured programs
and/or itineraries that are based on the specific
requirement of the clients or the inclusions
detailed in the marketing and sales tools used to
promote the package to the target market.
Delivery includes, overseeing the actual delivery
of services via the tour escort or the tour guide,
acting as the TO representative in the field.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales and revenues
are the following:
1. Variable markup based on the contracted rate
from the suppliers that are negotiated based on
the TOs production track record, the market
potential or influence. Its profits are variable
and adjustable, and are restrained by the
market forces, the competition and the profit
margins that must remain below the retail price
for the same service purchase individually.
Sales and Revenues of a Tour
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales and revenues are the
following:
2. By seeking and negotiating for favourable terms,
conditions and concessions. While the competition
may be required to pay a one-night deposit at a
lodging establishment before obtaining a confirmation,
another may be exempted from this requirement, one
TO may have a 60-day credit line, while another may
have a 90-day credit facility with the supplier or some
components are given by the suppliers on a
complimentary basis, buy included in the package at a
minimal cost.
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales and revenues
are the following:
3. Through the sale of optional tours, excursions
and extensions. During the operation of the
tour package additional revenues may be
generated by the sale of optional tours or
services, meaning the sale of service not
included in the price of the original tour
package purchased. And at the end of the tour,
clients may decide to extend their stay at the
endpoint of the tour package, thus generating
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales and revenues are
the following:
4. For tour group movements, souvenir shops grant
tour operator shopping commission on sales
generated. This is a legitimate source of revenue in
the business of operating tour anywhere in the
world. It is, however the responsibility of the TO to
ensure that souvenir shops that grant
commissions on sales generated maintain
reasonable retail prices that compare well with
other retailer. This commission is normally shared
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales
and revenues are the following:
5. Sometimes, a tour operator earns or
loses money on foreign exchange
rate fluctuations. Sometimes it
makes use of advance deposits and
cancellations fees.
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

“ Tour operator’s sources of sales and revenues are
the following:
6. Sometimes, TO avoid paying commissions to the
TMCs/travel agents thus earning more money,
through direct sales to end-users. However this is a
not a good practice since it undermines the
support of the TMCs/travel agents selling their
packages. This practice is not accepted by the
travel industry at large. Tour operators who
condone and practice this policy do not last long as
they lose the support and credibility of the retail
Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•Wholesaler. Their clientele are primarily the
retail TMC/travel agencies, thus they dealings
with the end-user I indirect.
•Acts as an intermediary to and as an
integrator of the travel suppliers.
•Derives income from variable but limited
profit margins and capitalizes on favourable
terms, conditions and concessions.
•Generates additional revenues by selling
optional tours, excursions and extensions.
Characteristics of a Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The four classifications of tour operators are: Local,
Domestic, Inbound and outbound.
1. The local tour operator (LTO) services Filipino
and/or foreign traffic to national destination by the
way of regular sightseeing tours or tour packages,
taking into consideration the popularity of the
destination, site or sight in the locality.
Exceptionally, they are the only one who
sometimes deal with any end user direct in the
addition to other tour operator interested in their
tour package.
Classification of Tour Operators
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

2. The domestic tour operator (DTO) services
Filipino traffic to any destination in the
Philippines, on an ad-hoc basis, as when
contracted by providing itineraries and
programs tailor-made to the needs of the
client. These tour operators handle most
group movements from educational
institutions, corporate travel, civic and
social associations and government entities.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

3. An inbound tour operator (ITO) services
foreign traffic to any Philippine
destination, on an ad-hoc and regular
packages basis. The ITO takes into
consideration in the specific requirements
of the contracting party abroad. Its source
of traffic is mainly foreign tour operators,
and may include both group movements
and individual travellers.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

4. The outbound tour operator (OTO) designs
and assembles tour packages for residents
of the Philippines, either foreign or local, to
any foreign destination, such as Hong Kong
and the USA. The source of business is
mainly affinity groups – groups with
common interests – and wealthy individual
travellers. Some of them offer every
competitive regular tour packages the most
regional (southeast asia) destinations.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Three classifications are based on: 1) area of
operations, 2) nationality of travellers, 3) market or
source of traffic, and 4) type of tour packages offered.
1. Area of operations. This refers to the geographical
area visited in the course of delivering the tour
product. It is the physical area, with all attractions
(natural or manmade), all activities whether
spontaneous or planned, the experience of events,
and in some instances, where the tour operator is
based, e.g: Iligan City, Province of Albay, Northern
Luzon.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

2. Nationality Travellers. Travelers
may be either Filipinos (residing or
not-residing in the Philippines) or
foreigners (citizens of foreign
countries residing in the
Philippines as expatriates or just
visiting).
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

3. Market or Source of Traffic. Refer to the
place of residence of those
participating in or availing of a tour
package. It does not necessarily mean
the nationality of the tourists or
excursionists. Example: German
expatriates living and working in Hong
Kong. The nationality is German, but
the market source is Hong Kong.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

4. Classification of Tour package. Tour packages are divided into
two: regular or ad hoc.
Regular Tour Packages are put together based on the
perceived need or interests of target market. These are prepackaged
and feature well-known attractions or activities that have high
demand. Examples of Regular Tour Packages are a two-night/three-
day honeymoon package to boracay and a seven-day Philippine Air
Safari. The Air Safari is a tour of some major tourist attraction in the
Philippines on a private, twin-engine airplane.
Regular tour packages are normally sold over the counter
with no need of pre-booking or advanced reservations on the part of
the traveller. Ad Hoc tour packages that are packaged to
specifications require pre-notice by the travler through the travel
agent, and advance reservations by the travel agent with the tour
operator.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

4. Classification of Tour package. Tour packages are divided into
two: regular or ad hoc.
Ad Hoc Tour Packages are tour packages that are tailor-
made to the requirements and specifications of a particular traveller
or group of travellers.
Examples of Ad Hoc Tour Packages are an overnight stay in a
know location (Bohol) from a major hub e.g Cebu or Manila and
Davao or a combination fly-cruise itinerary that connects an Air
Safari with a Discovery Cruise of the M/B Lagoon Explorer a 200
GRT catamaran operating in Northern Palawan.
These classifications are not strictly structured. Tour
operators more often than not combine two or three types, and in
some cases act as all four types. The type is determined by the main
function and activity in any of the four classifications.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Transfers: transportation to and from a
destination’s gateway airport, pier or bus
station) to the place of lodging and vice versa
Sightseeing tours: are a combination of
transportation within the destination sights
and sites of interest, tour guide's services,
entrance fees, entertainment activities and
sometimes, snacks and meals.
Tour Components
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Accommodations: lodging and meals in
the lodging establishments.
Tour Escort: refers to the services of an
individual who travels with the clients
from the point of origin and back, and
acts as the manager of the tour group.
This person is also known as the Tour
Leader.
Tour Components
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A combination of two or more of these
components is a tour package.
•Note that while the tour escorts travels with
the clients from the point of origin and back to
manage all activities of the tour’s itinerary and
insure the clients’ well-being; the Tour guide’s
services are provided in connection with
sightseeing at the destination and occasionally
during the meet and assist or transfer services.
Tour Components
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Depending on the number of components tour packages
have different labels:
•If only tours and transfers are included, it is called
ground arrangements package.
•If tours, transfers and hotel accommodations with some
meals are included, this is called land arrangements
package.
•If tours, transfers, hotel accommodations and some
meals plus transportation to and from the destination
are included, this is called an inclusive tour package.
•If all components are included, including a tour escort,
this is called an inclusive escorted tour package.
Tour Components
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•The product of the tour operator is the
tour package, a combination of two or
more travel components. The basic
travel components of a tour package are:
•Transportation: (by air, sea or land) to
and from a point of origin to a
destination or destinations and back to
the point of origin.
Tour Packages
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Basis Local Domestic Inbound Outbound
Area of
operation
Wherever the
tour
operators is
situated
Any
Philippine
destination
Any
Philippine
destination
Any
destination
abroad
Nationality
of travellers
Filipinos and
foreigners
living abroad
or in the
Philippines
Filipinos
living and
working in
the
Philippines
Foreigners
living and
working
abroad –
including
balikbayans
Filipinos and
foreigners
living and
working in
the
Philippines
Market
Source
Philippines
and abroad
Philippines Abroad Philippines
Package
Operated
Regular Ad hoc and
regular
Ad hoc and
regular
Ad hoc and
regular
Types of the Tour Operators
Emphasizing Their Differences
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The four classifications of tour operators differ in areas of
operations, nationality of travellers, market or source of
traffic and type of package handled.
•The Local tour operator (LTO) business comes from
both local and foreign travellers, visiting the destination
where the tour operator is based. Its clientele (traffic) is
generally off-the-street and over-the-counter sales and
occasionally other tour operators in the country. It
operates regular sightseeing tours or tour packages to
popular destination in the locality. The LTO is primarily
a retailer but occasionally acts as a wholesaler.
Types of Tour Packages Per Tour
Operator Classification
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Suppliers Integrator Buyers
Transportation
companies
Local tour operator
promotes and sells the
regular tour package
Walk in clients and
over the counter sales
Lodging
establishments
Attractions and
activities
Other tour operators
from without the
locality
Tour Guides
A < B B > C C > B
Local Tour Operator’s Tour
Package
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A < B – The LTO determines the popularity and
demand of a given destination, site or sight, and
prepares a package by contracting suppliers capable
of providing the different components.
•B > C – Markets, promotes and sells its package
directly to the end-user in the locality and
occasionally to other tour operators based
elsewhere.
•C > B – LTO operates the package to the specific
popular destination
Local Tour Operator’s Tour
Package
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The domestic tour operator’s DTO
business is derived from local associations,
schools, companies and corporation and
occasionally, individual travellers who
organize summer outings, out-of-town
meetings, incentive trips to national
destinations. The packages they prepare are
on an ad hoc basis, as and when contracted,
and tailor-made to the needs of the client.
Domestic Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Buyers Integrator Suppliers
San Carlos
University
Domestic tour
operator solicits
business and
prepares tailor-
made ad hoc tour
packages
Transportatio
n companies
Rotary Club
Ayala Land Inc Attractions
and activities
Fuji films Tour Guides
A > B B > A C < B
Domestic Tour Operator Package
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A < B – The domestic tour operator solicits business
from established organizations, schools, corporate
accounts.
•C > B – The domestic tour operator contracts
supplier capable of delivering the specific
requirements of the clients.
•B > A – The domestic tour operator actually
operates the program/itinerary requested and
contracted. It is primarily a retailer, since it trades
with end-users, such as San Carlos University,
Rotary Club, Fuji Films and Land.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

The inbound tour operator’s ITO
business is sourced from foreign tour
operators who send traffic to national
destinations, on regular or ad hoc
packages, based on the requirements
of their clients.
Inbound Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Country of origins Destination country
Retail travel
agent
Foreign
(outbound)
our
operator
Inbound
tour
operator
Lodging
establish
ment
Transport
ation
company
Foreign
(internation
al) Airline
Attractio
ns &
Activities
Tour
guides
D < A A > B B < D C < B
Inbound Tour Operator Package
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A > B – Foreign tour operator abroad determines the popularity for a
place in destination country. It contracts an inbound tour operator to
arrange for a tour package that will sell the place in the origin country. It
negotiates with an international airline for a tour base fare to marry
with the tour package prepared by the inbound tour operator.
•C < B – Inbound tour operator contracts suppliers capable of delivering
all services requested, and prepares a package for the foreign tour
operator.
•D < A – The foreign tour operator markets this package and sells it
through retail travel agents in the country of origin.
•B < D – Inbound tour operator actually operates the package for the
clients of the retail travel sellers. It is primarily a wholesaler, since it does
not trade directly with the end-user.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Mr. Traveler Retail travel
agent
(outbound)
tour operator
Inbound tour
operator
Lodging
establishment
Transportation
company
Foreign
(international)
Airline
Attractions &
Activities
Tour guides
D > B A > B A > B C > B
Ad Hoc Inbound Tour Package
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A > B – A retail travel agent abroad has a specific request
from a client for services in destination country. It either
seeks the assistance of an outbound tour operator in country
of origin or contracts directly an inbound tour operator (B)
in the destination country. It negotiates with an airline for a
tour base fare to marry with the tour package prepared by
the inbound tour operator.
•C > B – Inbound tour operator contracts suppliers capable of
delivering all services requested, and prepares/arranges a
package for the end-user.
•D > B – The inbound tour operator actually operates the
program/itinerary requested.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•An outbound tour operator (OTO) designs and
assembles tour packages for residents of the
Philippines, either foreign or local, to destinations
abroad.
•These packages may be designed for either groups
or individuals, to popular destinations overseas, or
tailor-made to the specification of the traveller. For
example a tour package with specific request to
include visits to Lourdes in France and Fatima in
Portugal.
Outbound Tour Operator
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Retail
travel
agent
Outbound
(foreign) tour
operator
Inbound
tour
operator
Lodging
establishment
Transportation
company
International
(Foreign)
Airline
Attractions &
Activities
Tour guides
D < A A > B B < D C < B
Outbound Tour Packages
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A > B – An outbound tour operator determines the popularity of a place
in destination country. It contracts an inbound tour operator there to
arrange for a tour package that it will sell to retail travel agents in the
origin country. It negotiates with an international airline for a tour base
fare to marry with the tour package prepared by the inbound tour
operator.
•C > B – Inbound tour operator contracts suppliers capable of delivering
all services requested, and prepares a package for the foreign tour
operator.
•D < A – The outbound tour operator markets this package and sells it
through retail travel agents in the country of origin.
•B < D – The inbound tour operator actually operates the package for the
clients of the retail travel sellers. It is primarily a wholesaler, since it does
not trade directly with the end-user.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Mr.
traveller
Outbound
(foreign)
tour
operator
Inbound
tour
operator
Lodging
establishment
Transportatio
n company
International
(Foreign)
Airline
Attractions &
Activities
Tour guides
D < B A > B B > A C > B
Ad Hoc Outbound Tour Packages
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•A > B – A retail travel agent has a specific request from a client for services in
destination country It either seeks the assistance of an outbound (foreign) tour
operator in country of origin or contracts directly an inbound tour operator in
the destination country. It also negotiates with an international airline for a tour
base fare to marry with the tour package prepared by the inbound tour
operator.
•C > B – The inbound tour operator in the destination country contracts suppliers
capable of delivering all services requested, and prepares/arranges the package
for the end-user.
•B > A – The inbound tour operators in the destination country provides a
proposal for the services requested, and prepares/arranges the package upon
acceptance
•D > B – The inbound tour operator actually operates the program/itinerary
requested. The outbound tour operator in this case is a wholesaler since it does
not deal or trade directly with the end-user, save when delivering the package,
but rather with the retail travel agents.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Regardless of the type of package, regular or ad hoc,
these may vary according to any of the following:
•Duration - Duration is the number of days and
nights included in the package. Normally three
days would mean two nights. However, when a
package crosses the international dateline or spends
an overnight inside an aircraft, the number of nights
in the package is the same as the number of days.
•Destination - A package may be for single
destination, or for multiple destinations, i.e. two or
more.
Tour Package Variables
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Regardless of the type of package, regular or ad
hoc, these may vary according to any of the
following:
•Category of Accommodations- The category of
the accommodation establishment may vary from
a De Luxe, to First Class, to Standard, to Economy,
to Budget. Pension houses and Inns are normally
not categorized. Resorts are categorized as “““
for the most luxurious, to ““ for first class to
“ for the standard. There are other resort
categorizations, such as special interests and spas.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•Meal Plan – Refers to the number of meals per day
included in the package, whether served in the place of
lodging or outside in a restaurant. If all meals are
included, this is a Full-Board basis, Full Pension or
American Plan. If only breakfast and lunch or dinner
are included this is a Half Board basis, Demi-Pension or
Modifies American Plan. If only full breakfast is
included, this is a Bed-and-Breakfast basis. If the
breakfast is Continental Plan. If no meals are included
in the package, this is a European plan tour package.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•Breakfast contents may vary. Coffee or tea with
rolls, jam and butter is a continental breakfast. If
eggs and bacon or ham plus toast are added, it is
an American breakfast. If the toast is changed to
fried or plain rice and the ham or bacon changed
to tapa or daing , it is a Filipino breakfast.
Any breakfast with rice porridge (lugaw) and a
number of side condiments is an Oriental
Breakfast. A table laden with breakfast-food and
self-service is a Buffet Breakfast.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•Mode and Class of transportation- Mode of
transportation refers to air, sea or land travel and
type of equipment. Class refers to the grade of
service, facility and amenities offered the
passengers. In air travel, the class divisions are First,
Business and Economy. In sea travel, they are Suite,
Stateroom, Cabin, Business Class, Tourist and
Economy. In land travel, it is Air-conditioned or
Ordinary service.
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Sightseeing tours, or just simply tours, are a
combination of transportation within the
destination to sights and sites of interests, tour
guide’s services, entrance fees entertainment
or activities and sometimes, snacks and meals.
No overnight stay. These are classified as
follows:
•Half day Sightseeing. Operated mornings or
afternoons. Normally includes a snack.
TYPES OF SIGHTSEEING TOURS
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

•Full day Sightseeing. Eight to ten hours
with lunch.
•Evening tours. Operated after six in the
evening. Normally includes dinner and
a drink.
•Optional tours. Tours that are not
included in the tour package, for which
the client pays extra.
TYPES OF SIGHTSEEING TOURS
Packages
Department
Department
TO
• Tour Components
• Tour Packages
Tours

Tour Operators' Main Functions

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