What is the difference between tour operator and travel agent activities? Both of these concepts imply the implementation of activities for the sale of a tourist product (TP). The difference is who exactly carries out this work - an individual or a legal entity.
Tour operator activity is the formation and implementation of TP, carried out by a legal entity - a tour operator. Travel agency activities are carried out by legal entities or individual entrepreneurs / travel agents. The subject of the sale is also a tourism product.
Organizations involved in the compilation and sale of tours are called tourist-excursion. They are called differently in life - from a simple tourist office to a large-scale holding of travelers and tourists.
Since the concept of tour operator activity is based on the sale of a product to a client, therefore, regardless of the form of ownership, which may be different for tour operators and travel agents, the main market task of all these companies is to achieve a stable position in the tourist market and receive constant profit.
The concept of tourism product (TP)
TP is a complex of works, goods and services that are necessary to meet the needs of a tourist as part of his tourist trip. The main three elements of TP are tour, goods and additional tourist and excursion services - accommodation, meals, transportation services, leisure. The tour is sold to the client as a whole. The main services included in the tourist package are purchased by the tourist at the place of residence. Additional - this is a free choice of a tourist, they can be bought later and are not included in the package: rental of additional equipment, telephone and consumer services, Internet, mail, currency exchange, expenses for additional meals, payment for public transport, various entertainments.
Tour operator and travel agent activities
From the point of view of the type of entrepreneurship in the tourism market, companies engaged in this activity can be divided into 2 groups: travel operators and travel agencies. What is the difference between the two? Each type of tourism organization determines the direction of its business activities.
There is a difference between these firms and the availability of TP. The bottom line is that the tour operator always has a supply of TP for sale, and the client can always get it urgently, but the travel agent does not have it, it acts only at the request of the client, submitting a request to the tour operator for a product or service as the client needs.
Basic principles of work and cooperation
The technology of tour operator activity in the interaction of tour operators and travel agents is based on the process of creating, promoting and selling a tour product (TP) to the end consumer. This product is formed by the tour operator on the basis of the conditions of the tourist market, by order of the client (individual or organization). The tour operator provides tourists with all the services included in the TP, either independently or with the help of responsible third parties.
Various types of activities for the promotion and sale of TP by travel agents are prescribed in the contract between the tour operator and the travel agent. An agent can act on his own behalf too.
Tour operators
These companies form and implement TP, for which the total price of the sales agreement is set. Examples of tour operators include transport companies, hotels, catering and sightseeing organizations, exhibition halls, museums, spa organizations, amusement parks and gambling and sports facilities.
When compiling a differentiated tourism product, the tour operator is based on the requirements and wishes of customers. It is about the development of specific tourist routes, saturated with services, the provision of which is provided by suppliers, the tour operator also prepares informational publications of an advertising nature that describe the TP, and determines the cost of the travel product for the travel agent. Further, the travel agent promotes and sells the product directly to tourists.
The purpose of the tour operator is to connect service providers with end customers-tourists. It is important to know the tourism market, the current situation deep inside and make the right choice of service providers for the client. A professional approach to understanding and evaluating the market is important, you need to know the features of its development, be able to determine the levers of its management.
In reality, the distinction between tour operator and travel agent activities can be difficult to determine. Today it most often happens that both functions are performed by one company, it can act as a tour operator, developing routes, and as a travel agent to sell them to end consumers - tourists. In addition, this company can purchase tours from other companies and sell them to its customers, pursuing its interest.
Today, the tourism industry is very well developed throughout the world, strong competition has influenced the definition of the structure of tour operators and their specialization.
Classification of tour operators
Tour operator activity is the provision of a differentiated product to a client. Depending on the volume and type of services provided, there are mass market tour operators selling a large number of TPs with charter flights included in them to massively developed, from the point of view of tourism, certain destinations. There is a second category: specialized operators that focus on a specific product or country, type of tourism. That is, they cover a narrow, specific segment of the market.
Types of specialized operators of tourism services
- Offering customers a specific service (for example, organizing a safari in Africa).
- Geographically narrow destination (there are companies that specialize exclusively in certain countries).
- An operator working for a narrow audience and offering family and youth tours, business trips.
- Offering specific destinations (e.g. camp sites).
- Organizations using only a certain type of transport - trains, motor ships or buses.
Classification of tour operators by place of business
There are three types of tour operators, distinguished by their place of work:
- Functioning in the domestic market - those that form TP within the framework of our country.
- Traveling companies form travel packages for foreign countries.
- Reception operators are based in places in countries of destination and serve arriving foreign tourists in favor of other agents and tour operators.
Initiative tour operators
Such organizations send tourists on holiday in Russia or abroad, having an agreement with the host country - with receptive organizations. Initiative companies differ from travel agencies selling foreign tours in that the tourism product they have formed consists of at least three services: accommodation, transportation of tourists and other services.
As a standard example of an initiative tour operator, you can cite a company that forms complex routes. Their tour operator activity is the provision of routes in a package, which are provided, in turn, by local tour operators in the places where the route passes. An initiative tour operator is obliged to provide travel to the place of the start of the trip and back, as well as provide transport to the client inside the route. These tour operators may be visiting and domestic companies sending domestic tourists to other regions of the state.
Receptive Tour Operators
These are companies “at the reception”, which form tours and programs for tourists, concluding direct contracts on the spot with local service providers. For example, hotels and catering, entertainment and other companies.
To whom to complain
Tour operator activity is a rather complicated job, as the quality of services and relevance should always be at the highest level. The extreme saturation of the market with offers of such services provides serious competition for any tour operator, therefore, to maintain customers and increase their loyalty, serious work should be done to maintain the quality of the services provided at the highest level. Follow market trends, follow the news, keep abreast of everything that happens on the market. If the tourist is not satisfied with the quality of the service provided, then, according to the current international and Russian legislation, he must file a complaint with the company that sold him the package of services. She bears responsibility to him regardless of whether it is a service or a third party - their provider.
Differences between tour operators and travel agents by income system
The basis of tour operator activity is the procurement of services, the formation of a package, the satisfaction of a client-tourist and profit from the sale of a tourist package. The tour operator receives earnings, which is formed from the difference between the cost of creating a product (tour) and the selling price to the client. The tour operator buys individual services, from this "set" forms a comprehensive tourism product, which, in turn, has its own pricing mechanism, based on including current market prices.
As for the profit of the travel agent - in fact, the retailer - it is formed from the commissions received for the sale of the travel product of the tour operator. In addition, profits can be derived from the difference between the purchase and sale price of TP. The travel agent sells TP both in the complex and as separate services, such as renting a hotel room, airline tickets and others at the prices of tour operators. Just a tour operator gives the agent a discount, which is his commission.
Travel agencies
Tour operator activity is also work with agents, intermediaries, implementing tours formed by the tour operator. These intermediaries conclude an agent agreement with the tour operator, within the framework of which the agent’s discount is determined, it is the commission, which is the payment for the agent’s work. Thus, the intermediary, having received his discount, sells the final product at the price of a tour operator, without overstating the price for the end customer.
A travel agency may also be a seller acting on the basis of contracts for the sale of tourist products.
TP from a travel agency
TP is an "inclusive" tours - complexes that include a set of services, formed each time individually, without a clear list. Each client has his own approach, taking into account the wishes of the customer.
What does the travel agent add?
To the purchased tour, the agent adds the travel of tourists from their place of residence to the first accommodation point along the route and vice versa.
This type of company is very common on the market today, a large number of companies work directly with customers, acting as retail travel agencies.
The tasks solved by travel agencies are in three main points:
- Full coverage of recreational and travel opportunities in the regions.
- Promotion of this information by means of modern marketing.
- Sale of tourist product.
Travel Agency Forms
There are some varieties of these companies depending on the set and nature of the services provided, the specifics of their activities.
- Agencies working on a commission basis and providing a simple sale of tours created by tour operators.
- Transport and travel agencies. These companies organize transport tours. In cooperation with them, it is possible to organize a joint company with transport organizations, combining efforts with railways, air and aviation transit companies. One of the options for cooperation with transport carriers is the conclusion of agency contracts for the sale of tickets.
- Multidisciplinary agencies for the implementation of tour operator activities. Today it is the most common type of company. These companies provide comprehensive customer service of any category. Among customers can meet both ordinary tourists and business travelers.
- Highly specialized agencies providing services to people engaged in business. That is, serving business trips of large companies. In addition to organizing leisure, congress services are also part of the activities of these travel agents.
Insurance
The most important aspect of tour operator activity - the insurance of the work of such a company - is a very acute issue, since today very few insurance companies undertake insurance of tour operators (many of them have recently declared themselves incapable of fulfilling obligations, are completing their activities, shifting responsibility for losses) to the insurer). In fact, the tour operator can collect money from customers and not pay counterparties for services. Is the insurer obliged to bear such risks?
The scope of tour operator activity, regulated by the law of the Russian Federation of November 24, 1996 No. 132- "On the basics of tourist activity in the Russian Federation", is nevertheless subject to insurance. The tour operator is obligated at its own expense to insure the risk of its liability if, due to the termination of its activities, it cannot fulfill its obligations under the agreement on the implementation of TP.
In the event of a similar situation, tourists should be compensated for the actual damage from the failure of the tour operator to fulfill its obligations under the contract. In this case, we are talking only about the tourist product not received, and not about fines, penalties and lost profit in case of failure by the tour operator to fulfill its obligations.
In addition to defining the insurance object and the duration of the contract, the tour operator’s liability insurance contract defines the insured events, the amount of the insured amount, the procedure and terms for paying the insurance premium. There is also a mandatory definition of the procedure and terms for notification by the insured person of the insurer about the occurrence of an insured event, the procedure for claiming compensation, a list of necessary documents when submitting a claim to the insured for compensation for damage. Finally, a measure of responsibility for improper fulfillment or non-fulfillment of the terms of the contract, as well as other rights and obligations of the parties, determined individually.
The laws
As already mentioned above, Russian tour operator activities are regulated by Federal Law No. 132. It defines the principles of state policy aimed at creating in Russia the foundations of a single tourism market. The law regulates the relations that arise when exercising the rights of citizens of the Russian Federation and non-residents to freedom of movement and other rights when traveling, the law describes the rules for the rational use of the country's resources suitable for tourism. The rights of customers are protected by the Civil Code of the Russian Federation.
Under what conditions do tour operators work
How to protect the rights of customers? A prerequisite for the implementation of tour operator activities is the availability of an insurance contract with the tour operator, which stipulates liability for failure to fulfill obligations to sell TP. As an alternative - a bank guarantee of fulfillment of obligations under the agreement on the implementation of TP, that is, financial security, which we will discuss below.
Outbound tourism tour operators should be members of an association of similar tour operators, the activities of which are regulated by the current legislation of the Russian Federation. These companies must have a tour operator's personal liability fund.
The director or other official representative of the tour operator should not have a criminal record, not taken or outstanding, which was the result of a deliberate crime, should not be convicted of violations in the field of tourism pursued by law.
Cash guarantees
Responsibility for lawful tour operator activities, financial support, its size, terms and conditions are defined in the tour operator's liability insurance contract or in a bank guarantee.
Financial support is determined by a minimum of five hundred thousand rubles for tour operators of domestic or inbound tourism. For companies operating in the field of outbound tourism, this amount should not be lower than thirty million rubles.
Tour operators that have not carried out outbound tours during the year, as well as new companies in the field of outbound tourism, must have financial support of at least 30 million rubles.
The term of financial support is rarely less than one year. Not later than three months before the expiration of the effective financial support, the tour operator must submit to Rostourism documents relating to financial support for the next period.
According to the law on tour operator activities, financial support is not required:
- Companies providing excursion services in the Russian Federation for less than 24 hours in a row.
- State and municipal unitary enterprises.
- Government agencies engaged in tourism activities in the framework of social tasks.
- Outbound tourism tour operators with a seven percent formed personal liability fund. The percentage is formed from the total price of the TP of the exit sphere for the previous year.