Tourism Business

Tourism Business
©Ramakrishna Kongalla

Introduction
R'tist@Tourism, Pondicherry University
• The Indian Travel Agencies like Jeena & Co., Lee & Muirhead
India Pvt. Ltd, and Jamnadas & Co. Ltd at Bombay also
operated inbound and outbound tours for Indian and
Foreigners. In 1920, the first travel agency was founded in the
• Jeena and Company was founded as the first travel agent in
1920 in Mumbai to cater to the domestic travel needs. The
company made use of the vast opportunities of the growing
business and ventured into the cargo and courier business.
• Subsequently after, it entered into different components of
travel related services like ticket booking, hotel
reservation, package tour, transport arrangements, etc. The
company along with other travel agents made much progress
in the post independence period.
2

Travel Agency
• Travel agency is a firm or corporation
qualified to provide
tours, cruises, transportation, hotel
accommodation, meals, transfer, sightse
eing and other elements of travel to the
general public as form of services and
finally acts as a retailer. This is a
business organization that is collectively
set up to accomplish missions, goals and
purposes within a formal structure. All
management theories are applicable to
manage the complex business networks.
It requires much coordinated activities
like division of labour, hierarchical
authority and responsibility.
• In addition to dealing with
ordinary tourists most travel agencies
have a separate department devoted to
making travel arrangements for business
travelers and some travel agencies
specialize in commercial and business
travel only.
• There are also travel agencies that serve
as general sales agents for foreign travel
companies, allowing them to
have offices in countries other than
where their headquarters are located.
Tour Operator
• An organization, firm or company who
buys individual travel components,
separately from different suppliers and
assembles them into package tour by
adding certain value which is sold with
their own price tag to the public directly
or through the middlemen (Travel
Agent) is called a tour operator. Tour
operator is a professionally managed
company which has much expertise and
experience in the planning and
operation of prepaid and preplanned
vacation packages for the general public
directly or through retail travel agents.
• The terms tour operator and tour
wholesaler are often used
interchangeably, and are treated here
as having identical meanings
R'tist@Tourism, Pondicherry University 3

Difference between TO & TA
Tour Operator
• It is a wholesaler
• It is principal agent or foreign
travel agent
• amend the tour itinerary and
program
• delightful and value added tour
itinerary
• located in the mega cities
• international transfer from hotel
to airport and vice versa
• Adequate excursion tours
• It accepts foreign currency
• generating new ideas and
attractions in the package
• member of international bodies
like PATA and ASTA
Travel Agent
• It works as a retailer and sells
package tours on behalf of the
wholesaler
• It is an intermediary between
tour operators and tourists
• It follows tour itinerary
• sightseeing tours and excursion
tours, airport arrival and
departure transfer, check in and
check out time in the hotel
• It acts as a local agent to confirm
and reconfirm the services
• Problem related to the tours is
solved by the travel agents
• member of national bodies like
TAAI and IATO
• terms and conditions for
commission with principal
suppliers

Origin
• Cox & Kings is oldest travel agency in the world
• modern travel agency first appeared in the second half of
the 19th century
• Thomas Cook, in addition to developing the package
tour, established with the Midland Railway
• British pioneer travel agencies were Dean &
Dawson, the Polytechnic Touring Association and the Co-
operative Wholesale Society.
• Originally, travel agencies largely catered to middle and
upper class customers, but the post-war boom in mass-
market package holidays resulted in travel agencies on
the main streets of most British towns, catering to a
working-class clientele, looking for a convenient way to
book overseas beach holidays.

Operations
• travel agency's main function
is to act as an agent
• selling travel products and
services on behalf of a
supplier
• unlike other retail businesses,
they do not keep a stock in
hand
• Sell the inventory got on
discount and acquire profit
• include the sale of in-
house insurance, travel guide
books, timetables, car rentals,
and dealing in the most
popular holiday currencies
Commissions
• operate on a commission-
basis
• compensation from
the airlines, car
rentals, cruise
lines, hotels, railways, sightse
eing tours, tour
operators, etc
• commission consists of a set
percentage of the sale.
• most airlines pay no
commission at all to travel
agencies
• In some parts of asia its zero
% commission

• HOTELS 10 -20 % some
accommodation providers pay more
than 20 per cent. Some pay room and
food free for group leader. Some do not
pay at all. Some pay overrides
also. National and international chain
hotels and resort companies
pay commission regularly. They usually
negotiate the two commission rates for
peak and off peak period.
• FOOD 10-20 % Some pay free meals
and breakfast to the group
leaders, escorts or guides. Sometime,
commission is not paid if it is not a
substantial business.
• ENTERTAINMENT 10 % Some
negotiate with the tour operators free
ticket and some times do not pay also if
it is not booked in advance.
• CAR RENTALS 5 – 10 % It is very
standard. The average commission is 5
%. Companies also offer cash and free
transport for familiarization trip of the
principal agents.
• TOURS 10- 20 % The common
practice of commission amount is 10 %.
Some rewards the retail agent over the
total business or target business. Some also
provide free package tour to the agents
and its staff and family members.
• CRUISE LINES 10- 15 % The average
commission is 10 % but in certain cases,
bonuses and overrides are possible based
on business performances.
• AIRLINES DOMESTIC 5 % It is very standard
in case of accredited Passenger Sales Agent
(PSA). Now-a- days, airlines provide them
cash return on each ticket unlike the
fortnightly commission procedure. More
online bookings are convenient to the
travel agents. Tour operators get special
commission as per the contracts and
adequate free tickets for company
shareholders, staff and family
members.
• INTERNATIONAL 6- 9 % International
flights offer heavy discount to the tour
operators other than the usual discounts.
Airlines prefer to deal with tour operators
for bulk sale of seats. This practice is
certainly well accepted across the airlines.

• CHARTERS 10- 15 % There are
principal tour operators which lease
out the air craft or work on
commission basis. The average
commission is 10 %. Other negotiable
offers are also attached with the charter
business.
• BUS TOURS 10 % It is mostly
uniform. Some also pay more than the
usual commission in the off season and
free trips for familiarization
tours.
• RAIL10 % Indian rails do have
much provision to offer commission in
cash to the tour operators. In most of
AMTRAK Foreign Rail & Eurail Pass
the cases, tour operators book
the circular tickets in order to get
the tickets booked in a reasonable
amount as per the Indian rail rules. On
the contrary, Railways in North America
and Europe provide varied schemes for
availing commission by booking the
tickets other than the standard
commission amount.
• Airlines domestic
5 %
• International
6- 9 %
• Bus tours
10 %
• Rail
10 %
• Selling cruise lines tickets
10- 15 %
• Hotels bookings
10 -20 %
• Car rentals
5 – 10 %
• Outbound Tours
10- 20 %

Types of agencies
UK
– multiples,
– Miniples
– independent agencies.
• The former comprises a number of
national chains, often owned by
international conglomerates, like
Thomson Holidays, now a subsidiary
of TUI AG, the German
multinational.
• It is now quite common for the
large mass-market tour companies
to purchase a controlling interest in
a chain of travel agencies, in order
to control the distribution of their
product.
• (This is an example of vertical
integration.)
• The smaller chains are often based
in particular regions or districts
In the United States
– mega,
– regional,
– consortium
– independent agencies.
• Independent agencies usually cater to
a special or niche market, such as the
needs of residents in an upmarket
commuter town or suburb or a
particular group interested in a similar
activity, such as sporting events, like
football, golf or tennis.
two approaches of travel agencies
• One is the traditional, multi-
destination, out-bound travel
agency, based in the originating
location of the traveler, is usually a
larger operator like Thomas Cook
• other is the destination focused, in-
bound travel agency, that is based in
the destination and delivers an
expertise on that location, is often a
smaller, independent operator.R'tist@Tourism, Pondicherry University 9

The internet threat to travel agency
• general public access to the Internet
• travel companies began to sell
directly to passengers
• airlines no longer needed to pay the
commissions to travel agents on
each ticket sold
• Since 1997, travel agencies have
gradually been disintermediated
• by the reduction in costs caused by
removing layers
• travel agencies have developed an
internet presence of their own by
creating travel websites
• major online travel agencies
include: Expedia, Voyages-
sncf.com, Travelocity, Orbitz, CheapT
ickets, Priceline, CheapOair, and Hot
wire.com
• Travel agencies also use the services
of the major computer reservations
systems companies, also known as
Global Distribution Systems
(GDS), including: SABRE, Amadeus
CRS, Galileo CRS and Worldspan
• Travel agents have applied dynamic
packaging tools to provide fully
bonded (full financial protection)
• All travel sites that sell hotels online
work together with GDS, suppliers
and hotels directly to search for
room inventory
• online travel websites that sell hotel
rooms
are Expedia, Orbitz and WorldHotel-
Link.
• comparison sites, such
as Kayak.com, TripAdvisor and SideS
tep search the resellers site all at
once to save time searching

• Nature of Activity
• Inbound – feature holidays to this
country
• Outbound – feature holidays to
other countries
• Domestic – specializing in the
country where they are based in
• Specialist – feature a specific type
of holiday or destination
• Independent-owner-managed,
usually specialized in specific
holiday or destination promotion.
• Integrated – large operators who
have taken over others
• Mass-market – large, well known,
key operators
Functions
carry out market research
• contract suppliers (purchase components)
• cost the package
• market and sell the package
• take reservations
• administer the holiday pre-departure
• operate the holiday from the UK and in resort
• employ overseas staff to ensure the smooth
running of the holiday offer post-holiday customer
care
• relationship with principals (transport,
accommodation and ancillary services) and retail
sector (travel agents)
• numbers of tour operators; dominance of the
sector by a few operators and their market shares
• impact of horizontal and vertical integration the
structure of the key integrated players, their
branded products, principals and retail outlets
direct sell operators
• Mass market vs. specialized operator trade
organizations (Indian Association of Tour Operators
and Travel Agent associations of India.

Function of Travel Agency
Travel Insurance
Personal
Baggage
Tour
Foreign Currency
MICE activities
entertainment,
Cultural
Handling agency for
the tour wholesalers
Booking,
confirmation and
reconfirmation of
hotels rooms,
Airline ticket,
train, bus, cruise
line reservation
and
reconfirmation
Tour Itinerary,
packaging &
costing
Liaison with
providers
Market Research
Costing & pricing
Promotion of
package tour
Executive tours
Travel
information
Counseling
Immigration
Passport
Visa
Custom
Clearance
Health
certificate
Landing permits
certificate
12

Foreign
Tour Operation
Companies
India as
destinations
SITA as
ground
operator
Goa,
Shimla,
Agra,
Mumbai,
Kolkatta,
Jaipur,
SikkimFigure- 1
FLOW OF PACKAGE TOUR BUSINESS THROUGH VARIOUS STAGES
13

Accommodation
Services
Carriers
Tour
operators
Travel Agent
Customers
Sales of goods/ services
Arranging a sale for commission
DOMINANT ROLES OF TOUR OPERATORS
Figure - 1
14

Travel Trade Intermediaries
Travel Agency Tour Operators
Retail Wholesale
Inbound
Tour
Operators
Outbound
Tour
Operators
Domestic
Operators
Ground
Operators
Figure-2 Types organization in Modern Travel Trade business
15R'tist@Tourism, Pondicherry University

Shareholders
Board of directors
MD President
General Manager
Finance Controller
Chief Executives
Heads of various Departments
Tour Research
& Planning Division
Travel & Tour
Division
Marketing &
Sales Division
Destinations
Service
Division
Human resource
Development
Finance &
Accounts
Transport
Department
Conferences &
Convention Dept.
Deputy Mgr or
Assist Mgr
Deputy Tour
Mgr
Deputy Marketing
Manager
Deputy
Manager
Deputy
Manager
Deputy
Manager
Deputy
Manager
Deputy
Manager
Executives
Tour Executives
(Inbound &
Outbound00
Sales
Manager Assistants Assistants Assistants Assistants Assistants
Assistants
Tour Assistants
Advertising
Manager
Tour & Travel
Booking Assists
PRO
Assistant
Tour & Travel Booking
Assists
A Typical Large scale Travel Agency
& Tour Company
16

Linkage of profit sharing between tour operators and
principal service providers
Bookings, Cancellation, Revenues, Performances
Flight Times, tariffs, Availability, Commissions, Confirmations
Location, Room Availability, Rack Rates, Commission levels
Airlines
Tour
Operators
Travel
Agents
Hotels
Information
Revenues&
Information
Revenues&
Information
Information
Information
Revenue
Information & Commission
17

Ground Operator
• it is necessary for the
company to assess various
pertaining factors before
the selection of a ground
handling operators.
• Convenient of Location
• Size of business
• Professional staff
• Length of business
• Reputation and
membership with
International and national
travel and tourism
associations.
• Credit facilities.
Reasons for Selecting Ground
Operator
• tour companies rely on the
ground operators or
handling agents at the
destinations for the main
reasons as follows;
• Introduction of new
product or plan to promote
these exotic destinations.
• Lack of control over the
government regulations.
• Lack of personal contract
• Language of barrier.
• Unfeasible to maintain own
branches at each
destination.

Services Offered by TO
• Airport and hotel transfer
• Arrangements for traditional reception at the arrival points.
• Experienced and professional tour guides, escorts, interpreter and tour managers.
• Excellent and personalized services at destination.
• Coordination with local tourist organizations at destination.
• Domestic and international air travel.
• Rail bookings in India, Europe, America & Japan.
• Hotel reservation
• Car rental.
• Travel documentation.
• Airport facilitation.
• Foreign exchange.
• Overseas travel insurance.
• Conference and seminar management. Business/trade delegations.
• Arrangements of luggage transfer in the airport and railway stations.
• Arrangements of guided sightseeing tours.
• Options and selection for worldwide destination
• Exhaustive itinerary planning.
• Appropriate hotel selection & reservation.
• Meeting, conference and meeting arrangements.
• Exhibition and factory Visits.
• Theme parties, events & sightseeing.
• Air tickets & travel documents like passport, VISA, health certificate and currency, insurance and permits for entry into
the restricted areas.
• Foreign Exchange & Travel Insurance. Trade Fair/Exhibition visits.
• Implant Operations - your in-house travel consultant equipped with CRS system and satellite ticket printer.
• Incentive travel in India and Worldwide.

Special interest services
• Ayurveda and Health
• Archaeology and historical sites
• Adventure and ecotourism sites
• Buddhism and Jainism ancient religious sites.
• Special cuisines at each place.
• Desert and jungle safari tour.
• Arrangement of comfortable entry and visit of fairs and festivals venues.
• Arrangement of short trips for shopping and exhibitions grounds.
• Making the provision of equipments for sports and games (Golf, winter
sports and water sports.)
• Provision for scholarly interpretation of objects with the help of experts
at the museums
• Arrangements for host community interaction.
• Organizing special cultural programmes in the palaces ( Rajasthan and
Gwalior)
• Adequate provisions for maintaining the first aid facility in the tour.
• Special amenities for the tourists in the train journey. ( Palace on
Wheels, Royal Orient, Fairy Queen and Deccan Odyssey)R'tist@Tourism, Pondicherry University 20

Distribution networks of tour operation business
Actual Tourist Potential TouristTour Operator
Approaches
Principal supplier
Transport
operators
Airlines and
Charter flight
companies
Cruise
Line
Companies
Railways &
Car Rental
Companies
Hotels
Event
Managers
Processing of package tours
Travel agentsEnd users (Cents)
Direct Selling
Internet
21

Linkage of profit sharing between tour operators and
principal service providers
Bookings, Cancellation, Revenues, Performances
Flight Times, tariffs, Availability, Commissions, Confirmations
Location, Room Availability, Rack Rates, Commission levels
Airlines
Tour
Operators
Travel
Agents
Hotels
Information
Revenues&
Information
Revenues&
Information
Information
Information
Revenue
Information & Commission
22

STRATEGIC ALLIANCE WITH THE SERVICE PROVIDERS
Support service
private service
Producers/
Principal Suppliers
Support Services
Pubic Sector
Guiding
Services
Travel Insurance
Travel Finance
Travel press
Marketing
Support
Guides and
Tine stables
Publications,
training, etc.
Carriers Accommodation Attractions
Manmade
Air Transport
Sea Transport
Rail Transport
Road Transport
Hotels, Motels
Guest Houses
Villas
Apartments
Holiday Homes
Holiday villages
Holiday camps
Ancient
monuments
Ancient
centre
Theme
Parks
Catering
National
Tourism
Office
Regional
Tourism
Office
Education &
Training
Visa &
Passport
service
Tour Operators and Brokers
Travel Agent
Tourist
Figure-2
23

Professional
Networks of
Travel Agency
Surface
Transport
Cruise Line
Hotels
motels
Resorts
Others
Airline
Industry
Tourism
Associations
Cultural and
Entertainment
organizations
Dept of
External
Affairs
National &
State
Tourism Depts.
Educational
Institutions
Foreign
Principal
Agents
Banking
Institutions
Insurance
Companies
Tour
Wholesalers
24

Tourism companies
• IRCTC
• Thomas Cook
• Cox & Kings
• SOTC
• Orbitz
• SITA

Indian Railway Catering and Tourism Corporation
• IRCTC is a subsidiary of the Indian Railways that
handles the catering, tourism and online ticketing
operations of the railways in 2002
Services
• Catering
– Catering Policy 2010 (by Mamata Mukharjee)
Catering services provided by IRCTC were hand
over to INDIAN Railways. Now IRCTC is in charge
of catering services on Few trains such as All
Duranto Exp, Frakkha Exp, Maitree Express( Train
between INDIA and BANGLADESH),Kandhari Exp
and some Rajdhani Exp rest all of train operated
by Zonal Railways railway stations across India.
– However IRCTC still operate Janaahar at railway
station.
– IRCTC also started NRC project(NON RAILWAY
CATERING) under which cafeteria were operated
in many Indian Ministries and Institutes.
• Online ticketing
– known for changing the face of railway ticketing
– pioneered Internet-based rail ticket booking
through its website, as well as from the mobile
phones via GPRS or SMS
– cancellations or modifications can also be done
online
– In addition to E-tickets, IRCTC also offers I-tickets
that are basically like regular tickets except that
they are booked online and delivered by post.
– The Tickets PNR Status is also made available
here recently.
– Mumbai's suburban railway can also book season
tickets through the IRCTC website.
– IRCTC has also recently launched a loyalty
program called "Shubh Yatra" for frequent
travellers, discounts on all tickets booked round
the year by paying an upfront annual fee.
– launched flights and hotels booking facilities
which added to their line of online reservation
services
• Tourism
– organizes budget and deluxe package tours for
domestic and foreign tourists, Bharat Darshan
– Luxury tourism packages are also available, that
involve special luxury trains such as:
• Palace on Wheels
• Royal Orient Express
• Golden Chariot
• Deccan Odyssey
• Royal Rajasthan on Wheels
• Buddhist Circuit Train
• and IRCTC is a partner in the Maharajas’
Express operation.
• log on to railtourismindia.com and book Rail
Tour Package, Holiday Package, Hotels, Cabs,
Tourist Trains online.
• adventure tourism packages that include water
sports, adventure and wildlife treks, etc. A
provision for customising tours as per specific
requirements is also an added attraction.

Awards and achievements
• IRCTC website had become the largest and the fastest growing e-
commerce website in the Asia-Pacific region, with about six lakh
registered users in 2003
– Awarded the National Tourism Award of Excellence by Ministry of
Tourism, Govt. of India.
– Awarded the National Award for E-Governance, 2007-08 jointly by
Department of IT, Govt. of India and Govt. of Haryana.
– Awarded the Genius of the Web Award 2007 for being the "Best E-
Governance PSU Site" by CNBC.
– IRCTC Tourism Unit of West Zone declared winner for the category Best Value
Leisure Product in Travel and Tourism Fair of India (TTF & OTM 2008) held
in Mumbai from 9 to 11 February 2008.
– Won National award for E-Governance for being "Best Citizen Centric
Application" for the year 2007-08.
– IRCTC Tourism Unit declared winner for the category Most Innovative
Product in Travel and Tourism Fair of India (TTF & OTM 2007) held in Mumbai
from 10 to 12 February 2007.
– Won CSI-Nihilent E-Governance award for "Best E-Governance Project" in
2007.
– Won the ICICI Bank Retail Excellence Award in 2005.
– Won Path Breaker Award from Dataquest in 2003 and 2004.
– Awarded the Mini Ratna Category-1 by Ministry of Railways, Govt. of India

Travel and Tourism Fair(TTFOTM)
TTF
• is India’s leading exhibition for the
travel & tourism industry. Since
1989, it provides an annual
opportunity for organisations from
India and abroad to showcase their
products and services to a large
cross-section of the travel trade
industry and consumers across
major markets in India.
• With more than 1500 Exhibitors
from 61 countries and 35 Indian
States / UTs, an ever increasing
number of foreign country
representations, and a committed
visitorship of more than 186,000
visitors, TTF together with OTM is
the largest network of Travel Shows
in India.
• OTM is India’s leading travel show
focused on Outbound travel. It
provides an annual opportunity for
organizations from around the
world to showcase their products to
a large cross-section of travel trade
and consumers in all major target
markets in India, just before the
peak outbound season.
2012
– Mumbai
February 17, 18, 19
Bombay Exhibition Centre, Goregaon
(East)
– New Delhi
February 24, 25, 26
Pragati Maidan.
• Concurrent with TTF
• Endorsed by PATA
• Organised by FAIR FEST MEDIA ltd

ThomasCook
• Thomas Cook (22 November 1808 – 18 July
1892) of Melbourne, Derbyshire, England
• with Midland Counties Railway, he
arranged to take a group of
540 temperance campaigners
from Leicester Campbell Street station to a
rally in Loughborough
• During the following three summers he
planned and conducted outings for
temperance societies and Sunday-school
children.
• In 1844 the Midland Counties Railway
Company agreed to make a permanent
arrangement with him provided he found
the passengers.
• On 4 August 1845 he arranged
accommodation for a party to travel from
Leicester to Liverpool
• In 1846, he took 350 people from Leicester
on a tour of Scotland, however his lack of
commercial ability led him to bankruptcy
• He persisted and had success when he
claimed that he arranged for over 165,000
people to attend the Great
Exhibition in London
• Cook established 'inclusive independent
travel', whereby the traveller went
independently but his agency charged
for travel, food and accommodation for
a fixed period over any chosen route.
• Such was his success that the Scottish
railway companies withdrew their
support between 1862 and 1863 to try
the excursion business for themselves.
• In 1865, the agency organised tours of
the United States, picking up
passengers from several departure
points.
• A round the world tour started in 1872
• In 1874, Thomas Cook introduced
'circular notes', a product that later
became better known by American
Express's brand, 'traveller's cheques
• By 1888, the company had established
offices around the world

Cox & Kings
• longest established travel company in the world, its
history stretching back to 1758 when Richard Cox was
appointed as regimental agent to the Foot Guards.
• Cox & Kings is now an independent tour company with
offices in the United Kingdom, India, the United
States and Japan. Its global headquarters are in London
• Cox was born in Yorkshire in 1718
• 1740s, went on to become the Colonel of the First Foot
Guards
• The company set up five branches in India between
1905 and 1911

Airline ticketing

Flying time
– The difference between
the take off time and the
landing time
MPM & TPM
– MPM Establish the
maximum permitted
mileage between the fare
construction points of the
fare component following
the same global direction
as that used in the NUC
above.
– TPM Add up the ticketed
point mileage of each
sector and compare the
total TPM to the MPM
Rounding up
– LCF Round the resulting
local currency fare and
take note of required
number of decimal units
for the currency.
I TINERARY PREPARATION
– Available flights
– Flight timings
– Passenger timings
– To and fro
– Booking a ticket
accordingly

Travel Information Manual (TIM)
• TIM (Travel Information Manual) is the world's leading source for information
on air travel requirements. Millions of passengers find their way to final
destinations time after time with the TIM. The never-ending movement of
people and commodities continues to run smoothly when players are
informed of TIM's up-to-date country entry requirements worldwide.
• Key Benefits
• The TIM is a must for all who are involved in the travel industry. This unique
manual lists rules and regulations for more than 216 countries on subjects
such as:
• Passports
• Visas
• Health information
• Airport tax
• Customs and currencies
• Latest news
• Designed for
• The information found in TIM is consulted by thousands of users around the
world every day, including airline offices, travel agents, corporate
accounts, tour operators, GDS and government agencies.

Types of Fare
• Fare
– The amount charged by a
carrier for the carriage of a
passenger and his allowable
free baggage as being
applicable to the class of
service to be furnished
• Normal fare
– Unrestricted normal fare
– Restricted normal fare
• Unrestricted normal fare
– Or Primary normal fares
– Normal fares without any
restrictions
– Permit unlimited stopovers
and transfers
– F or C or Y class fares
• Restricted normal fare
– Or Secondary normal fares
– Have stopover and transfer
conditions
– Lower than primary fares
– F2,P2 etc (for first class
restricted fare)
– J2, C3 etc (for business class
restricted fare)
– Y2, S2, Y11 etc (for economy
class restricted fare)

Special fares
– Special fares are low promotional fares that
have more restrictions than the normal
fares
– Aim partially promotional and partially
social
– Restrictions in respect of
• Length of stay
• Advance purchase requirements
• Reservations, payment and ticketing limits
• Day/time of travel
• Eligibility restrictions
• Refundability and changeability
• Types of special fares
– Public Special Fares
– Inclusive Tour Fares
– Public Group Fares
– Reduced fares for specific categories of
persons
– Miscellaneous Fares
• Public Special Fares
– Late Booking Fare
• These are fares that can only be purchased at
the last moment or with in 24 hrs or so of
departure
• Stand by, late purchase, or instant purchase
fares
• Can only travel if seats are empty at the time
of departure
• These tend to be the cheapest fare
– APEX Fare
• Advance Purchase Excursion fare
• Restrictions on timing of purchase
• Require advance reservation with advance payment ,
a minimum no. of days before departure
• Does not allow open dated segments, all flight coupon
must have confirmed reservation
• Penalties for changes in booking and ticket
cancellation also apply
– PEX Fare
• Purchase Excursion Fare
• Does not have a requirement to purchase the
ticket a minimum no. of days before
departure
• Payment of ticket up on obtaining confirmed
seats
• Does not allow open dated segments
• Penalties for changes in booking and ticket
cancellation also apply
– Excursion Fare
• Have duration limits as expressed by
minimum and maximum stay dates
• Attracts mostly vacation travelers and tourists
• Usually allow open dated segments
• Rebooking or cancellation penalty fees do not
applyR'tist@Tourism, Pondicherry University 36

• Inclusive Tour Fare
– Prearranged combination of air
transportation and surface arrangements
other than just public transportation
– Arranged by Travel Agents or Tour
Operators
– GIT Fares
– IIT Fares
• Public Group Fares
– Designed for group travel without land
arrangements
– Available when passengers travel together
and have compiles with minimum group
size
– Common Interest Group fare
– Incentive Group fare
– Affinity Group fare
– Non- Affinity Group Fare
• Common Interest Group fare
– Passengers who have a bonafide common
interest by traveling together by the same
routing to the same destination
– Common interest must be other than
qualifying for the discount
• Incentive Group fare
– For employees and/or dealers and/or
agents of the same commercial
organizations traveling under an
established Incentive Travel Program
• Affinity Group fare
– This fare is available to members of the
same organization /company/association
having some affinity
• Non- Affinity Group Fare
– Members of a travel group who does not
share a common affinity.
– The pax are just assembled in order to
avail the group discount
• Reduced fares for specific categories
– Diplomat / Govt. fare
– Family fare
– Military fare
– Pilgrim fare
– Senior Citizen fare
– Students fare
– Youth fare
• Miscellaneous Fares
– Other fares that does not fall under the
above categories
– Special event tour fares, triangular fares
etc.

Fare calculation

NOTES/EXCEPTIONS:
• 1. For tickets issued for travel commencing in Algeria/Tunisia, check identity papers of
the passenger to see whether or not, s/he is a resident. Residents of these countries
are quoted a lower fare level than non-residents. (See latest PAT GeneralRules book.)
• 2. Additional HIP checks apply for journeys originating from India, Malawi, Western
Africa, Yemen and for journeys whollybetween Kilimanjaro and Nairobi.
• 3. BHC is not applicable for:
– a) Journeys wholly within TC1
– b) Journeys wholly between Argentina, Brazil, Chile, Paraguay, Uruguay and TC2
– c) Pricing units wholly within Europe
• 4. OSC is not applicable to/from/via USA/US Territories and for journeys
originating/terminating in Canada
• 5. DMC is only applicable to One Ways to/from/via Japan when the traffic document is
not issued in the country from which the journey commences (Scandinavia is
considered one country) For electronic tickets, the traffic document is deemed to be
issued in the country in which the electronic record is established.
• 6. DMC is not applicable for traffic documents issued in:
– a) TC1 for journeys commencing in TC1
– b) Canada, USA/US Territories for journeys to Canada, USA/US Territories
– c) Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Congo (Brazzaville), Cote
d’Ivoire, Equatorial Guinea, Gabon, Guinea-Bassau, Mali, Niger, Senegal or Togo and the journey
originates in these countries.

• Payment modes
– Direct cash
– Card swipe
– Online payment
– cheques
• Issuance of ticket
– Manual ticket
– Automated ticket
– E- ticket
– Single coupon ticket
– Double Coupon ticket
– Four coupon ticket
– Airline ticket
– Neutral ticket

Cargo Handling
• Baggage allowance
– On the commercial
transportation, mostly
with airlines,the baggage allowance is
the amount of checked or carry-
on luggage the airline will allow per
passenger. that is allowed free of
charge
– In 2007 with most airlines now
charging for both the first and second
bag. However, within Europe, and
often on flights between the United
States and Europe, the limit is as low
as 40 pounds (18 kg) total per
passenger, and many airlines do not
allow passengers to exceed this
amount, even with payment of a fee.
– Many passengers complain about this
limit, because after the typical 15-20
pounds (7–8 kg) of
the suitcase itself, little room remains
• Piece Concept
– passengers are permitted to check two bags
with a per-bag weight of up to 50 pounds (23
kilograms) for Economy Class, and up to 70
pounds (32 kilograms) for Business or First
Class.
– Certain airlines operating under the Piece
Concept may add additional checked baggage
allowance for their Elite Level fliers.
– Weight restrictions are per bag, unlike the
Weight Concept.
• Weight Concept
– each passenger is permitted to check a total
bag weight in however many bags they have.
Typically, Economy Class is permitted to check
in up to 44 pounds (20 kilograms), Business
Class is permitted to check in 66 pounds (30
kilograms), and First Class is permitted 88
pounds (40 kilograms), Unlike the Piece
Concept
– allows passengers to combine their bag
weight into fewer bags which would
otherwise be too heavy to travel under the
Piece Concept
• Most airlines have changed the policy and
allow as of November 2009 only one bag
to be checked in for free. The second bag
will cost between $50-55

Accountability of baggage loss
– 250,000 Francs or 16,600
Special Drawing Rights
(SDR) for personal injury;
– 17 SDR per kilogram for
checked luggage and
cargo,
– 5,000 Francs or 332 SDR
for the hand luggage of a
traveller.
• International financing
instrument created in
1970 by the International
Monetary Fund (IMF) to
coincide with the
disfavour of the US dollar
as the principal currency
of the world trade.
• At present, one SDR is the
sum of 0.6320 US Dollars,
0.4100 euro, 18.4
Japanese yen and 0.0903
pound sterling

• Dangerous Goods
– Class 1: Explosives
– Class 2: Gases
– Class 3: Flammable Liquids
– Class 4: Flammable Solids
– Class 5: Oxidizing Substances
& Organic Peroxides
– Class 6: Poisonous (toxic) &
infectious substances
– Class 7 : Radioactive
Materials
– Class 8: Corrosives
– Class 9: Miscellaneous
dangerous substances &
articles
• Cargo rates and valuation
charges

• Automation
– Information concerning
– Schedules
– Fares
– Ticket reservation
– Invoicing
– Electronic check
• Airport procedures
– Check in
– Check out
– Airport services
– In flight services

Requirements in setting up Travel Agency
• SEC Registration:
- Incorporation Papers/By-Laws
- Capitalization, Subscribed shares, Paid-Up Shares
(minimum of P .5M)
- List of Stockholders & Citizenship, ther addressesm
respective Community Tax Certificates and TIN
- Latest General Information Sheet
- Board Resolution of Authorized Signatories
- Corporate Address
- Appointed Corporate Treasurer-in-Trust
- Bank Certificate for Corporate's paid up capital
DTI Certificate of Business Registration
- Certified photocopy of the Articles of Incorporation
- Application Form
Local Government License and Mayor's Permit
- Articles of Incorporation
- DTI Certificate
- Barangau Clearance
- Corporate Community Tax Certificate
- Other Local Gov't Clearances ( employees' health
certificate, ID, Barangay, Police, NBI clearances, 4 1x1
photos of all company employees, etc.)
- General Liability Insurance
BIR
- Corpopate Registration
- articles of inc
- DTI certificate
- Mayor's Permit & Business Licenses
- Corporate Logo
- Contract of Lease
- Incorporators/Employess Registration and TIN
- 1 pc passport size colored picture in white background
- Civil registry documents; i.e. birth, marriage certificates
• SSS/Pag-Ibig/Philhealth
- Articles of Inc
- DTI Cert
- Mayor's Permit and BUsiness Licenses
- BIR Registration
- Employees' Alpha List, SSS number, Pag-Ibig Number, Philhealth Number
DOT Accreditation
Legal
1. Mayor's Permit/Municipal License
2. Business Name Certificate for Single Proprietorship
3. Articles of Incorporation/ Partnership & By-Laws for
Corporation/Partnership and Business Name Certificate, if applicable.
Financial
1. Latest Income Tax Return and Audited Financial Statements
Physical
1. Contract of Lease of office space/Certificate of Title
Other DOT Documentary Requirements
1. Application Form
2. List of Officials and Employees
3. Valid visa and labor permit for foreign nationals
4. Board Resolution/letter form owner/partners authorizing its bonafide
employee to sign/file/transact business with DOT
DOT Requires:
- a P .5M cash revolving fund for operation
- Travel and Tours Seminar of Manager/Owner
- at least 1 Tourism Graduate employee
Others:
*You will need at least P70,000.00 to process and file these
requirements, aside from the required P .5M paid up capital.
**IATA/DITS Registration/Seminar

• Incentives to Travel
Agents
– Profit sales leads to
incentives
– Incentive trips
– Incentive family trips
– Incentive lunch coupons
– Reference at important
destinations
– VIP passes
• Constraints & limitations
of Travel Agents
– High competition level
– Element of Uncertainty
– Stringent regulatory laws
– Language constraint
– Effect of currency exchange
rate fluctuations
– Relations between
countries
– Different interests of
travelers
– Fluctuations in demand

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