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TIP > TIP lectures 3 & 4 > Flashcards

TIP lectures 3 & 4 Flashcards

1
Q

What are the activities of the CEO and staff management?

A
  • Strategic & company planning
  • Finance, HRM
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2
Q

What are the activities of the contract & product department?

A
  • Procurement/contracting
  • Product management
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3
Q

What are the activities of the sales & marketing department?

A
  • Sales & Marketing
  • Internal processing
  • After sales
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4
Q

Name min. 5 roles or responsibilities of a tour operator

A
  • Managing the company
  • Data analysis (historic data)
  • Market research
  • The transport, accommodation and additional options
  • Contact with stakeholders (airlines, hoteliers, local agents etc.)
  • Negotiating contracts
  • Confirming reservations
  • Managing and responding to customer feedback
  • Marketing
  • Pricing, calculations packages
  • Administrative issues (bookings, invoices, issuing tickets etc.)
  • Contacts with other traders (based on distribution choice)
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5
Q

What is the definition of procurement?

A

The process of buying products, goods or services.

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6
Q

What is the procurement process? And define the process steps.

A
  • Strategic: in line with the company strategy
    E.g: Low-Cost strategy so for contracting = cost reduction
  • Tactical: choice of supplier, price and conditions
  • Operational: buying and contracting
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7
Q

What are the daily activities of a Contract Manager/Product Manager/Procurement Manager?

A
  • Strategy choice
  • Distribution choice: Direct or via Local Agent (= DMC) or combination!
  • Analyzing: important part of the job!
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8
Q

Describe the procurement department

A
  • Related to the (marketing) strategy
  • Procurement marketing: what, where, when, how much and with who?
  • Analysing
  • Procurement Year-plan & Procurement scheme:
  • Suppliers
  • Prices
  • Offers, negotiations
  • Contracts
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9
Q

What steps does the Destination Lifecycle consist of?

A
  • Exploration
  • Involvement
  • Development
  • Consolidation
  • Stagnation
  • Decline ..or Rejuvenation
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10
Q

What are the tasks of the (year)-plan contract department?

A
  • Choice of product/destination(s).
    *Based on client, supply & concept (strategy)
  • Procurement duties.
    *Trade shows/contacts/market research
  • Choice of intermediary at the destination(s).
    *Position of the DMC, details contract
  • Internal financial analysis & visiting destination(s).
  • Final procurement plan.
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11
Q

The way of contracting differs per company, depending on what?

A
  • Small, medium or large company
  • Location/market
  • Type of product
  • Volume of ‘the business’
  • The STRATEGY
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12
Q

(TUI) What is the procurement when it comes to beach holidays?

A
  • Stronger focus on own airline, own hotels
    -Direct contracting, mass tourism
  • Product Manager analyses the full market, and makes the final ‘shopping list’
  • Contract Manager closes the deals for all markets
  • Service centres (previous local agent) take care of transfers, excursions etc.
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13
Q

(TUI) What is the procurement when it comes to individual/smaller groups travelling to worldwide destinations?

A
  • More a traditional way of contracting
  • Importance of a good local agency
  • Volume decides the contract-business
  • Use of Full-Service Carriers
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14
Q

(TUI) What is the procurement when it comes to city trips?

A
  • “Hotelbeds” & Bed banks
  • Contracting via Local agents/DMC
  • Hardly use of own TUI-airline
  • Volume of ‘the business’ differs per city
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15
Q

What is a bed bank?

A

A bed bank is a wholesaler of accommodation (rooms) that purchases rooms at a discounted price for specific dates in bulk and resells these to travel agencies, airlines, tour operators, DMCs, TMCs, and OTAs.

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16
Q

What is a Geo-Focused Network? (airlines) Name an airline example.

A
  • Concentrates operations in one geographic region.
  • High frequency.
  • Limited flights to other areas.
  • May join alliances or codeshare.
    e.g. Alaska Airlines or Austrian
17
Q

What is an Intercontinental Network? (airlines) Name an airline example.

A

FSC
- Covers the entire domestic market.
- Hub-and-spoke network, sometimes with multiple hubs.
- Routes to multiple global markets.
- Participates in global alliances.
- 3- or 4-star rating Skytrax
e.g. UNITED airlines, Lufthansa or KLM

18
Q

What is a Global Luxury Connector? (airlines) Name an airline example.

A

FSC
- Significant global reach
- Hub and spoke network
- Luxury service and product
- Long-haul connections
- Alternative to non-stop flight
- 4- or 5-star rating Skytrax
e.g. Emirates, Singapore Airlines or Qatar airways

19
Q

What is an Independent airline/Network Extender? Name an airline example.

A
  • Primarily extends the reach of partner carriers into smaller markets.
  • Operates under co-brand, code share, or pro-rate agreements.
  • Occasionally subsidiary of larger carrier.
    e.g. AeroMexico connect or SkyWest airlines
20
Q

What is an Ultra Value airline? Name an airline example.

A

LCC
- Aggressively stimulative pricing.
- “Seat-only” product: charge extra for other services (e.g. checked bags)
- Ancillary revenues
- Leisure customer service
- Serves secondary airports
- Point-to-point services
e.g. spirit airlines or RyanAir

21
Q

What is a Traditional Value airline? Name an airline example.

A

LCC
- Point-to-point operations
- High frequency
- Target leisure and price-sensitive business travellers
- Serves secondary and primary airports
e.g. Southwest or easyJet

22
Q

What is a Modern Value airline? Name an airline example.

A

LCC
- Point-to-point and network
- Target mix of business and leisure travellers
- On-board product thrills superior to competitors’ Economy Class (e.g. LiveTV, XM Radio, seat pitch)
- Often serves primary airports
e.g. jetBlue airways, Virgin blue or Transavia

23
Q

What is a Charter airline? Name an airline example.

A
  • Focus on unscheduled service with some scheduled operations
  • Significant reliance on tour operators selling vacation packages
  • Target customers are often agnostic to the branding of airline components of vacation package products.
    e.g. TUI or My Travel
24
Q

What are the 5 business models in the airline industry?

A
  1. Full-Service Carriers (FSC)
  2. Low-Cost Carriers (LCC)
  3. Hybrid business model (between FSC and LCC)
  4. Charter Airlines
  5. Only carrying cargo
25
Q

What is the definition of a hybrid airline?

A

An airline that operates with a low-cost business model but has a standard of service that is similar to what you would expect from standard and legacy carriers.

26
Q

What are charter airlines?

A
  • Linked (mostly) to a Tour operator
  • Focus lies on unscheduled services and some scheduled services
  • Significant reliance on Tour Operator/package tours
  • Customers are often not aware of the brand of the airline
  • This business model is losing importance in the Airline Industry
27
Q

Tell about the air transportation of TUI Group.

A
  • Product/destination is leading!
  • Strong focus on own airline or leasing extra aircraft via an external party.
  • Analyse markets, trends, historic data & availability of slots.
  • Separate contract department for TUI Fly
  • Flexibility within the company is key for TUI
  • ‘Seat only’ vs ‘Package deals’ depends on the market. E.g. Belgium strong orientated on VFR markets, NL on package deals for short & medium haul markets.
28
Q

What are IT-Fares?

A

Inclusive Tours fares for Package Deals. For contracting FSC (Full-Service Carriers) or external Charter Airlines.

29
Q

What two contracts are there (contracting for tour operators)?

A
  1. Guaranteed contract
  2. Allotment contract
    *But also: - Combined forms
    - ‘Sell and Report’
30
Q

What is a guaranteed contract?

A
  • Tour operator guarantees occupancy for the accommodation
  • 100% risk for the tour operator
31
Q

What is an allotment contract?

A
  • Also called a deadline allotment.
  • Tour operator holds an allotment until the release date: Accommodation reserved for the tour operator until a certain date.
  • Date = Release date/cut-off date
  • 100% risk for the supplier (hotel/airline)
32
Q

What are the pros of guaranteed contracting?

A
  1. Lower price for Tour Operator
  2. Availability until the last moment
  3. Influence
  4. Request for ‘Exclusivity’
  5. NO over-book situation … or?
33
Q

What are the cons of guaranteed contracting?

A
  1. High risk for Tour Operator
  2. Pay in advance: Negative effect on the cash flow
34
Q

What are the pros of allotment contracting?

A
  1. Risk for the accommodation
  2. Flexible
35
Q

What are the cons of allotment contracting?

A
  1. Higher price
  2. No last-minute availability
  3. Less influence
  4. Over-book situation!
  5. Relations
36
Q

When which contract?

A

Buyer’s market: Allotment
Seller’s market: Guaranteed

37
Q

What do you have to keep in mind when positioning tour operator?

A

To seek a balance between the degree of risk and the final sale price.

38
Q

What are the differences between high occupancy vs low occupancy?

A
  • High occupancy= High risk & Lower consumer price
  • Low occupancy= Less risk & Higher consumer price
39
Q

What is the global contract on car rental companies?

A
  • Car (& Campervan) rental based on a 24-hrs rental period
  • Flexible fare structure and/or fixed contracted rates

TIP (4 decks)

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