Employee Functions, Business Location, and Challenges of the Target Market - Case Study Example

ECO TRAVEL agency EXECUTIVE SUMMARY Vision statement ECO TRAVEL agency provides all its clients with quality, unique and transformational travel arrangements of a world class nature that are highly personalized and tailor made to suit the travel needs of people touring the beautiful continent/ country that is Australia leading to an improved understanding and appreciation of our country’s culture and people. Mission statement ECO TRAVEL agency is a world class travel and tour agency that strives to provide the leading premier travel and tour related services to corporate and individual clientele by providing them with innovative travel and tour options that meet all business and leisure travel needs. ECO TRAVEL places an emphasis on providing the clientele with customized tour arrangements and attractive packages as per the client’s travel reservations. ECO TRAVEL agency strives for practical and creative approaches as well as opportunities to make the Australian tourism sector more appealing, and accommodating to first time visitors and also repeat tourists. Our continually updated knowledge of the tour and travel industry in Australia plus our skills in the newly emerging travel tools and products make us a force to be reckoned with as we leave all our clients fully satisfied ensuring a recommendation of our agency to colleagues, friends and family wishing to travel and tour Australia Employees and their functions ECO TRAVEL agency has a number of professionals who come highly skilled and recommended owing to their formal training in the best colleges and higher learning institutions specializing in the tour and travel field. All these employees have superb computer skills and brilliant communication skills essential for serving the agency’s clientele that include: Travel agents/ guides and escorts – the travel agents have all received formal and specific training and they come highly experienced in specific areas that include foreign languages, world history and culture, marketing, sales, geography, ticketing and reservations procedures and marketing. They also possess additional skills like detail to accuracy and organization of travel itineraries and plans. ECO TRAVEL’s travel agents work on developing and promoting its corporate image and selling its tour packages and services. They have a wide knowledge of Australia’s regions and serene destinations . Receptionists/ reservation clerks – ECO TRAVEL agency has the most qualified front office personnel. They are responsible for managing the agency’s switchboard by receiving and responding to incoming phone calls and transferring them to the relevant staff and responding to routine enquiries being placed to the agency. The agency receptionists also make hotel reservations for the travelers and process requests to purchase travel tickets and ensure that travel arrangements are done professionally and that the clientele get the best value for their money . Tour operators and tour guides – the tour operators provide cultural and historical information and interpret Australia’s heritage, and provide additional assistance to the clientele by taking them round to areas that are of significant interest to them such as historical sites and other establishments. ECO TRAVEL’s tour guides are well versed in foreign languages as they may have to interpret the culture and heritage in specific foreign languages as requested by the clientele. They also have the appropriate tour guide qualifications. Drivers – our drivers are well qualified and have an experience of at least 5 years driving. They know Melbourne’s major sights and other prominent places all equipping the tour guides with major sightseeing experiences. Their main expertise areas range from defensive driving, and bush driving as well as basic driving. All drivers have comprehensive safety driving skills and are well equipped with first aid skills. Business location ECO TRAVEL’s main office will be located in Port Melbourne along Beach Street in Beacon cove amongst the high density commercial businesses. The location was selected as its quite accessible to the port and shipping dock – for the clients travelling by ship and luxury liners and it’s also quite accessible to the extensive road network in Port Melbourne as well as timber cottages and apartments for the visitors. Challenges of the target market The Australian tour and travel industry has changed quite dramatically over the past few years but some challenges remain still persistent. There has been a paradigm shift in the tourism industry too; an industry that has had to formulate new approaches so as to resolve some of the most long standing issues fundamentally so as to address the current challenges effectively and capitalize on newly emerging opportunities. Some of the challenges that face the tour and travel industry and our target clientele include the following: the inability to make reservations to visit certain places as a result of them being in areas that are far-flung, incompetent staff, learning foreign languages and poor communication, poor liaison with the major tour associations and other government agencies, monopoly of already existing tour agencies, self-packaging of holidays by individuals and corporate via the internet and not needing tour agencies. Other challenges include: demographic changes, shifting of travel patterns, volatile economic conditions more so with increasing pressure on the Australian dollar and pressure on the stakeholders of the tour and travel industry to develop strategic and effective business campaigns. The challenges facing the Australian tour and travel industry are complex and numerous. How to address these challenges will require a high level of cooperation and coordination to marshal the industry’s resources more effectively. Competing priorities and fiscal pressures among the stakeholders requires new and innovative partnership arrangements so as to respond to growing global opportunities and growing competition. Solutions to these challenges ECO TRAVEL agency will provide an array of solutions to the challenges mentioned above and they include: having local representatives in a majority of areas that appear local in Australia and offering them a good pay package, having niche tour operators to specialize in a number of activities and tour operations and activities that the clients may be interested in such as skiing, deep sea diving and surfing, other solutions include hiring professional staff that are highly qualified and fluent in foreign languages, encouraging the tour operators to exercise contracting power with their suppliers in hotels and airlines and liners, meeting with fellow agency operators for seminars to chart the way forward for the tour and travel industry in Australia, liaising with the Australian tourism boards and government authorities so as to subsidize taxes pertaining to the tourism industry . Future management plans ECO TRAVEL agency strives to be one of the world’s global success stories as a travel agency. This should be achieved by establishing consistent growth trends that will see and ensure its expansion into other countries and as a result hiring more employees. ECO TRAVEL agency plans to be one of the world’s fastest growing tour and travel agency that will transform the Australian tourism sector and to make it an exciting travel destination as well as an interesting region for possible investors. ECO TRAVEL agency future plans also include the successful entry of a very competitive retail business environment and establish an innovative new chain of travel agencies around Australia, and the rest of the world . Another future plan is to branch and expand from just one retail agency to a chain of retail tour and travel agencies in urban and sub-urban areas not only in Port Melbourne, but also an expansion programme to other regions of the country will be underway with established growth. There will be an establishment of new national chain of retail travel agencies (e.g. in shopping malls, on high streets, in the CBD or the suburbs, in regional or rural location and there will be an engagement of tour and travel packages not only in retail, but also in wholesale and/or inbound markets. TABLE OF CONTENTS EXECUTIVE SUMMARY 1 TABLE OF CONTENTS 6 INTRODUCTION 7 BACKGROUND STUDY 7 MARKETING TECHNIQUES 8 Target market 11 OPERATIONS 12 FINANCIALS 14 CONCLUSION 16 INTRODUCTION BACKGROUND STUDY ECO TRAVEL agency is a travel agency based in Melbourne, Australia and was started in January 2012 to cater for the tour and travel needs of several people targeting both individuals and corporate entities. ECO TRAVEL caters for different travel needs: business travel for corporate entities and business people/ investors touring the Australian continent, student travel for students intending to study in Australia, and leisure travel for holiday making and adventure purposes. ECO TRAVEL was structured, designed and created solely for the purpose of offering tailor made travel packages to suit the needs of the growing number of travelers to and from Australia. ECO TRAVEL is a travel agency like no other – one that enlists the services of outsourced creative consultants to design the itineraries of travelers with imagination, pizzazz and flair basing them on individualized personal and group preferences. ECO TRAVEL is an Australian based travel specialist agency that represents a large majority of Melbourne’s tour operators and travel guides. ECO TRAVEL aims at offering an array of attractive and re-packaged services within Port Melbourne such as airline travel bookings, last minute hotel accommodation deals, bookings for touring sites, beauty salon and barber shop appointment bookings, shopping excursions, bookings for restaurants and tours to attractive places. ECO TRAVEL agency also offers tailor made tour packages to cater for travel requirements ranging from flights, car hires, coach touring, cruises on liners, vehicles, coach and rail transport. The tours focus on the aboriginal culture of the Australian people, scenery and wildlife, and also tours and cruises to the most populous, popular, remote and unique parts of Australia. ECO TRAVEL agency also provides online booking services for that online experience for private cruises, sailing activities, rafting adventures and other boating events. ECO TRAVEL agency plans to install the most sophisticated whole sale air ticketing systems and travel technology as well as tour and travel databases to cater for the growing needs of travelers. MARKETING TECHNIQUES In this segment, the focus is to clearly identify the potential market for this travel agency. The marketing approaches and strategies should be appropriate and innovative enough to suit the needs of the clientele; both actual and potential. This is because the travel agency will act as an intermediary between the airlines and their customers. The main/sole purpose of marketing is to get more clients, generate sales, improve profitability margins, and generate more revenue and income . Developing and implementing an effective marketing and promotional strategy/ approach is a challenging issue for any travel agency in Australia. A good and practical strategy will ensure that ECO TRAVEL agency has a competitive edge over other travel agencies in the tour and travel industry and suppliers too. A good marketing plan will ensure that tour operators eliminate their over reliance on commissions and instead focus on means of generating more service related fees. The marketing plan should be able to change with the ever evolving consumer buying patterns. Some marketing strategies to be used include: 1. Online marketing – this is an effective marketing tool as the use of a website will bring a large amount of significant attention to the travel agency. Internet marketing models and tools like e-commerce and online advertising will be used to ensure that those needing the services of travel agencies do not go un-catered for. Allowing online transactions should go a long way to ensure that travel services are paid for without having to travel to the physical offices thus saving on time and resources. Internet usage as a marketing tool also creates an effective business re-engineering tool for the travel agency business. Adverts may also be posted on social sites like you tube, twitter and Facebook. The use of social media as a marketing tool should not be ignored and video viral should be posted online as well as social media campaigns. Embracing social media and other recent innovations will go a long way to create the necessary buzz for ECO TRAVEL agency. Online promotions and search engines are important marketing strategies that help to market a business both locally and internationally. Establishing an online presence will help develop relationships with prospective clientele. 2. Uses of mobile phone marketing – mobile phones go a long way to facilitate communication. It can also be an effective marketing tool by ensuring that customers leaving their numbers and contacts with the agency receive messages on new packages that are tailor made to suit their travel needs. Mobile phones are efficient marketing tools that enhance market campaigns and advertisements. ECO TRAVEL agency may enlist the help of the Australian mobile phone providers to carry out this kind of marketing. 3. Networking with clients- effective communication and networking will ensure that ECO TRAVEL agency staff bond with their potential and actual customers and eliminate the risk of having vulnerable and unsure clients who may eventually end up being poached by the competitors. Networking will create brand resonance. 4. Having a public strategy – this is by using adverts on mass media and having other prospective campaigns that will ensure more clients hop on board like having press releases, newspaper, TV and radio coverage will establish and create a long lasting market effect more so when done regularly. 5. Having attractive tour and travel packages – budget considerate tour packages that are attractive will ensure that prospective clients are attracted and converted into actual clients with time. The next step will be to cultivate loyalty from the actual clients through repeat purchase. 6. Word of mouth is the same as creating an oral buzz or viral campaign 7. Effective advertising such as handing out printed material like brochures and fliers as well as bill board adverts. That said, there are some common mistakes that should be avoided when advertising ECO TRAVEL agency and these include the following: Over repetition of the product – the customers may end up bored when they see and hear the same ad’s monotonously. Lack of a company logo may not give the agency the corporate identity it deserves – the agency needs a symbol that will uniquely identify it from other agencies. Snob and emotional appeal – this two factors may affect the agency negatively snob appeal in the sense that the customers tastes and preferences will not be considered, and emotional appeal is the over use of emotion to sell a product or a holiday package such as pity and fear. Confusing the potential consumer Use of technical jargon that may be too hard to decipher Associating some products and packages that may not be related to the products Offensive messages and name calling while trying to pitch for the product/ package Providing the consumer with the general feeling that the product has a glittering generality with no emphasis on the consumer. Target market ECO TRAVEL agency will appeal mostly to the lower income client who wishes to go on holiday but is a little too strapped for cash. ECO TRAVEL agency unlike other agencies that focus on high income earners exclusively will serve the wealthier clientele but will also offer and provide them an adventure package. ECO TRAVEL agency’s main target market will be the low income earners but will also cater for corporate and individuals who have a high income. The major purchasers of tour and travel packages may be in urban areas – with specific focus to Port Melbourne and as a result, there is bound to be rapid growth in the market and an increasing demand for holiday packages . There’s bound to be difficulties experienced in competing with already established agencies who are the competitors that have been in the tour and travel industry for much longer. For instance, there are approximately 4,500 travel agencies in Australia. The major retail travel networks across Australia include Harvey World Travel, Travel scene American Express, Jet set Travel world, Flight Centre and Travelers Choice. These will be ECO TRAVEL agency’s main competitors in the industry. However, ECO TRAVEL’s target market is a niche that can be exploited and its services differentiated. ECO TRAVEL’s target market is bound to have similar tour and travel interests despite their not so disposable income and sensitivity to price. Examples of such persons include the following: people on holiday/recreation travel, attending events for sporting contests, music festivals, arts and cultural performances, or they could be people on business travel or people visiting friends and relatives, or students intending to study in Australia. OPERATIONS ECO TRAVEL agency as a retail travel agent will have the main operations of selling travel and tourism products and services to customers of behalf of suppliers including different forms of accommodation (e.g. hotels, resorts, eco lodges, motels etc), domestic and international airlines, car rentals, railways, packaged holidays, sightseeing tours, travel insurance and other services. ECO TRAVEL agency will be mainly concerned with the main operations of a travel agency and those include transportation, storage of customer details, advertisement placements, management and planning of travelling services, selling and the provision of a hands on computerized reservations system and additional services like the proper management of corporate and individual travel . ECO TRAVEL agency will demonstrate a working proficiency computerized reservations system that will be responsible for the creation, modification and maintenance of passenger and client names, as well as building their price air itineraries and the generation of their automated ticketing and airline ticket placements inclusive of boarding passes, the booking of their hotel accommodations, their desires to have coach and car hires will also be catered for. By so doing, ECO TRAVEL agency will have created and developed a renewed understanding of the unique demands and needs of both the corporate travel market and individual tour and travel needs, and differentiate them from the leisure travel market. ECO TRAVEL agency’s personnel and staff alike will have unique duties and responsibilities and will work collectively to examine and cater for the growing needs of the tour and travel industry. ECO TRAVEL will also examine the products and services offered in a typical way by competitors targeting both the corporate and leisure markets. It should be noted that the maintenance of clients and the storage of their details will enhance and boost sales, and also clients will come back for a repeat purchase as a result of the maintenance of their accurate client files as well as constant provision of in-agency promotions and displays . Maintenance of an active and useful client database will help and go the extra mile in helping the maintenance of an active clientele. Automation of functions in ECO TRAVEL agency will encourage and promote the efficiency of the delivery of high quality and personalized customer service to clients in the tour and travel industry. Other key operations will include the accessibility of vital information pertaining to the client’s travel needs such as the retrieval and interpretation of the available air travel displays, car hire rates and hotel reservation fees. Since the majority of the clients of ECO TRVAEL agency are likely to be air passengers and liner passengers as well, another key function of this agency will be to interpret and to quote air travel and cruise ship rates, access the feature benefits of either transportation mode and access the possible procedures of hotel accommodations and car rental possibilities . Another operation of ECO TRAVEL agency will be the distribution of holiday packages online and managing its inventory. The major operation will be to support destination products as a focus on the exclusive distribution of major hotels, cruises and airlines in Australia. Though consumer based product sellers will do so on behalf of the tour operators, the tour operators working for ECO TRAVEL agency will no doubt charge a hefty commission to manage the exclusive pricing of tickets. FINANCIALS The first step in financing this business will be to establish how much cash ECO TRAVEL agency will need to take the business off the ground and convert it from a mere plan to an actual reality . Convincing any banker that ECO TRAVEL agency’s management of its possible cash flows and the cash flow projections for the business will safely be included in loan repayments will go a long way to securing loans from the bank, in as much as ECO TRAVEL agency’s financial beginnings will be quite humble. With growth of the business, more loans will be secured from the money lending institutions to facilitate expansion. Review of what might serve as collateral for securing a loan may be the next step to be taken . The amount of cash required/needed will be predicted by the use of cash flow control for one that will spell out the business sources of income and expenditure. Some expenditure items may include the purchase of office supplies like stationery, furniture and office fixtures, computer equipment and machinery, leasing or renting office space and payment of the same etc. the strategy will be to prioritize the expenses and capitalize on obtaining them – such as rent/lease and furniture. Alternatives will also need reviewing for instance, instead of purchasing a car for the business, hiring or leasing one may be the best alternative. Financial reports to be used in the agency’s management will be discussed constantly. The different financial reports mostly to be used in the management of ECO TRAVEL agency will be explained also to stakeholders during the annual general meeting at the end of every financial year. The identification of ECO TRAVEL agency’s financial contribution to the overall growth, expansion of Australia’s corporate travel agency industry will be fostered by the maintenance of accurate financial reports and records. A lender chart indicating the possible lenders that will be considered to finance ECO TRAVEL initially will give a rough estimate of figures and an idea of the financial estimates for ECO TRAVEL agency is as represented below: For the above mentioned sources of business loans to come to fruition, there must be things that will enhance and facilitate this such as the use of business financial statements and tax returns, having a business plan, projection or budget, personal tax returns and financial statements. These documents will explain to the lenders listed above why the business requires funding in detail. A repayment plan may also come in handy where loan repayment structures may be payable at the agency’s discretion and may be done in agreement with the lenders, whether it may be done monthly, bi-annually or annually and the dates to start repayment may be included on the repayment plan . In addition to this, financially speaking, there will be the requirement of purchasing an operating license. Stand-alone systems for selling tickets online will mean that the agency will have the system directly linked to its main website and ECO TRAVEL agency will have to pay a company that will serve as the host and manager. The upfront license fee is expensive to obtain but the funds channeled into the project at business startup will require ECO TRAVEL agency’s tour operators to have full time accessibility to the hosting facilities and have expertise and additional abilities to manage and install the software required . CONCLUSION ECO TRAVEL agency as a retail travel agency will focus and be able to demonstrate an innate and in-depth knowledge of the commercial and corporate travel market, and will identify target markets that will contribute to their overall expansion and growth. ECO TRAVEL will strive to work collectively with other important stakeholders in the Australian tour and travel industry, as well as the identification and solicitation of other potential commercial business ventures, and the identification of how these business ventures will contribute to agency profitability and income generation avenues in both the corporate segment and individual travel segment. ECO TRAVEL agency will employ the most sophisticated means of online payment due to the growing popularity of the internet and continuously improved online user experience. Australia’s online tour and travel business has tremendous growth potential. Australia’s travel market projected to grow at 40% more per year, and the market is expected to reach 70 billion Australian dollars annually. The Australian tour and travel online market has attracted the attention of investors both at home and abroad. Investment has reached unprecedented heights in the coming years, and ECO TRAVEL agency is bound to capitalize on this. Internet startups are now focusing on mobile applications in Australia such as online group tour booking, trip planning, attraction ticket booking and user generated content which is a recent emerging trend that ECO TRAVEL agency will use to challenge the already established tour agencies and will be backed by significant venture capital investments. ECO TRAVEL agency will employ new startups with innovative solutions and products that will bring vitality to Australia and its tour and travel industry. ECO TRAVEL agency will no doubt experience competition fiercely in some areas especially in the air and hotel booking business targeted by thousands of national and local competitors. The only way to have a competitive edge in the tour and travel industry and become an industry giant will be to have online travel communities. ECO TRAVEL agency will unsurprisingly lead by a large margin and result to a homogenous competition leading to vicious prices and declining profit margins in the tour/travel and tourism industry. The only way that ECO TRAVEL industry will differentiate itself from the competition will be to foster a new culture of constant innovation. Though realistically speaking the future of ECO TRAVEL agency’s market will be a bright one though the agency will have to match consumer demands for the betterment of investors and stakeholders interest in the tour and travel market. The matching of new ideas and concepts with capital will be required to put the agency in action. It’s no wonder that for a long time now many prospective tour and travel customers have had the ability to make their reservations online without enlisting for the services of a reputable tour and travel agency to help them find and make their basic hotel and flight reservations. ECO TRAVEL agency will make it possible for these customers to book their holiday products and packages by having attractive sightseeing packages, and individualized products that will enable the clients to purchase their holiday destination products. ECO TRAVEL agency will have the main challenge of selling more seats and having systems in place that will manage those seats and provide the clients the best value for their money. ECO TRAVEL agency’s tour operators will face individual challenges but the agency will research so as to find out the best way to manage and sell the holiday products through their booking portals or through ECO TRAVEL agency’s website. References Abrams, R., & Kleiner, E. (2003). The successful business plan: secrets & strategies. California: ThePlanningshop. Affairs, A. I. o. I. (2004). Australian journal of international affairs: the journal of the Australian Institute of International Affairs. London: Australian Institute of International Affairs. Blackwell, E. (2011). How to Prepare a Business Plan: Create Your Strategy; Forecast Your Finances; Produce That Persuasive Plan. London: Kogan Page. Business review weekly: BRW. (2006). Business Review Weekly. Economics, U. o. A. D. o., Australia, F. U. o. 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