Calculations for the tourism industries

Matakuliah : G0404/Tour Guiding

Tahun : 2006/2007

Miles and kilometres

A kilometre is shorter than a mile and it is important not to confuse the two units when calculating distances

To express kilometre in miles, multiply by 0.62

•Example: Express 400 km in miles

Method : 400 x 0.62 = 248 miles

To express miles in kilometres, divide by 0.62

Example: Express 155 miles in km

Method : 155 ÷ 0.62 = 250 km

Speed, Time and Distance

To do this, we must work on an average speed – either miles per hour (mph) or kilometres per hour (kph).

Method : Formula to learn : Distance ÷ Speed = TimeNB : If the distance is in miles and the

speed is in mph then the time will be in hours.

If the distance is in kilometres and the speed is in kph then the time will be in hours.

Maps and plans

It is sometimes necessary to measure the distance between points on a map (this is best done by using an opisometer) and then converting this measurement (probably in inches or cm) to miles or kilometres.

The map is said to be “drawn to scale”.Example : a line of length 1 cm may

represent 1 km.

Discount

It is a method of reducing the price in order to sell items or to get payment quicker.

Usually shown as a percentage.Examples : If the original price of a holiday

was £350 and 5% was “slashed”off that figure, then the new price would be found as follow:

Discount (continue)

•Original price £350 •1% = £3.50•5% = £17.50•Therefore new price is £350 - £17.50 = £332.50

Another use of the term discount:•”Our terms are 2% cash discount if payment is made within one month”.

In other words you may deduct 2% off the bill if you pay within one month. It is an encouragement to pay the bill promptly.

Gross profit (g.p)

Widely used in industries such as the hotel and catering industry and and denotes the difference between the buying and selling price of an items.

Examples : The selling price of a meal is £9.00 but the food cost in providing the meal is £3.00. Find the Gross Profit.

Gross profit (g.p) (continue)

Method : Selling Price £9.00

Cost Price £3.00

Gross Profit £6.00

Usually expressed as a percentage of the selling price.

Example : 6 ÷ 9 x 100 ÷ 1 = 66.66%

The Gross Profit is 66.66% of the selling price

Calculations for the tourism industries (continue)

Matakuliah : G0404/Tour Guiding

Tahun : 2006/2007

Net Profit

Net Profit is the difference between the price at which goods and services are sold and the total cost.

Can be found by first finding the Gross Profit and then subtracting the Labor and Overheads.

Labour Costs include wages, national insurance, staff turnover, etc

Overheads include gas, electricity, telephone, etc

Deposits and cancellations

Deposits :A sum of money is requested as a show of good faith that the booking will be taken up.

An insurance against cancellation can usually be taken out for a fee at the time of booking a holiday. This will reimburse any costs for which a holidaymaker may be responsible providing there is a genuine reason.

Commission

That is, they sell a product or service on behalf of someone else and they are paid a sum of money for so doing.

Usually in percentage

Currency conversion

Usually is affected by differing interest rates, and imports and exports (including tourism).

Selling a price

Formula to learn : Costs + Profit = Selling Price (100%)

Time Zones

The times change by 1 hour for every 15° longitude difference between places.

You will find that various countries add or subtract hours certain period of the year to make better use of daylight hours (Daylight Saving Times - DST).

READING A TIMETABLE AND FARE TABLE

Timetables and fare tables are a mass information. A lot of effort has gone into

their design in an attempt to present information as simply and clearly as

possible.

VALUE ADDED TAX (VAT)

• Is a customer tax.

• Business are registered for VAT purpose so that they can charge for and reclaim this tax.

HIRING A CAR

• Travel agencies are able to arrange car hire in almost every country in the world.

• To encourage and reward the travel agents for providing this service they are paid a percentage commission by the car hire companies.

ORGANIZING YOUR OWN TOUR

“Tours are not created from a cookie cutter mould. They can, and should, be as unique as you and your clients are.”

THE BIG STEP – BRANCHING OUT ON YOUR OWN

• The most important question you need to ask yourself is, “What area of the world do I find impossible to resist?”

• Once you have your answer you are ready to move on to the second step of designing a winning tour.

THE THEME – WHY YOUR TOUR WILL BE DIFFERENT

• “Why do you want to take people there at the first place?”

As you do research, think about how you can enhance the theme of your trip throughout the time you are traveling.

WE’RE HERE! NOW WHAT?

• REMEMBER: Most people take a tour because they want to see it all!

TIMING

• Is extremely important and deceptively complex.

• REMEMBER: Holiday and special events tend to drive the price of everything up. Make sure you calculate these increases when pricing your tours.

YOUR GUESTS

As a tour director, part of your challenge is to make your guests feel

as much as home as possible!

Matakuliah : G0404/Tour Guiding

Tahun : 2006/2007

SHELTERING YOUR GUESTS

• REMEMBER:

Not all parts of the world enjoy the same standard of living. Make your group aware of the differences they can expect at your destination.

NOURISHING YOUR GUESTS

• Ask yourself questions concerning “grand cuisine” that would be expected by your guests.

MISCELLANEOUS CONCERNS

• Medical

• Security

• Insurance

COSTING OUT YOUR TRIP

• MAKE SURE your clients understand exactly what extra values and services you are providing if you plan to charge more than your competitors.

COSTING OUT YOUR TRIP

• Getting there

• Food

• Accommodations

• Attractions

REMEMBER:

• Always ask about senior discounts and clarify what age qualities as a senior.

REMEMBER:

• Nothing beats first hand experience. Always check a destination out in person before you take a tour group there.

RUNNING YOUR OWN TOUR

WHAT’S INSIDE

WORKING AS AN OUTSIDE AGENT

• You need to consider how you will let travelers know that your tour is available and how you will sell it to interested clients.

WORKING AS AN OUTSIDE AGENT (continue)

• If you make a connection with a travel agency, you also have a great source of revenue.

• By working with a travel agency, you are fitting into the established system for selling services and paying invoices.

CHOOSING A TRAVEL AGENCY TO WORK WITH

• Selecting the agency you will work with is one of the crucial choices you must make.

• WHY?

CHOOSING A TRAVEL AGENCY TO WORK WITH

• Small versus large agencies

LARGE FIRMS some real advantages such as they have more reduced rate trips for their staff.

IATA/ARC and non-IATA/ARC agencies

• There are two governing bodies in the airline industry. ARC operates in the United States and IATA sets the standards in the rest of the world.

CHOOSE AN AGENCY THAT CAN SELL TRAVEL INSURANCE

• Not only is insurance very profitable because of its high rate of commission, but it will also help you avoid trouble.

CHOOSE AN AGENCY THAT CAN SELL TRAVEL INSURANCE

• Travel insurance not only provides a very necessary safety net for you and your group but it also generates income.

• Push insurance hard.

USING MULTIPLE AGENCIES

• Using several different agencies at the same time IS NOT RECOMMENDED because it spreads your clients out.

HOW TO FIND AN AGENCY TO WORK WITH

Matakuliah : G0404/Tour Guiding

Tahun : 2006/2007

HOW TO FIND AN AGENCY TO WORK WITH

• By checking employment ads

• By calling agencies in your area

• By asking your friends

COMPENSATION – TRIPS AND CASH

• Free tips and tour director seats

If you are going to a popular destination at peak season and have only a small group, you might still be able to get a free trip, but not with tour director seats.

GETTING PAID CASH

• Another way to travel “free” is to earn enough cash from your venture to pay for the trip.

OTHER WAYS TO GET PAID

• You will need the help of the manager at your travel agency the first couple of times you negotiate prices directly with the airlines and other travel suppliers.

GETTING MORE COMMISSION

• If you conduct tours several times a year, the higher volume of sales you are bringing in should enable you to negotiate a better rate of commission with the travel agency.