Travel Agency Proposal

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					                   Executive Summary

Dynamic group shows a tendency of expansion of their wings and its
consolidation. XYZ Travel being a progressive is intending to expand

At the outset, it is essential to highlight the scenario of the local travel
agencies in Karachi. Presently 17 carriers operating in Pakistan and
the number of travel agents in Karachi and Sindh are 400 IATA and
314 non –IATA registered to TAAP and there are many more
mushroom agencies. The reasons I mentioned number of airlines
operating and number of agents due to easily understand the
difference between supply and demand. Travelers are fewer and
agencies are countless. Being the travel Industry professional it is
quite difficult for me to digest how they are surviving doing some
wrong hanky-panky business or some suspicious reasons to have a
travel agency with their other businesses.

If compared from the past the business has shrink down due to the
obvious reasons safety and security in the country, problems in
getting visas almost all countries imposed visa on Pakistani passport
previously most of the countries visas available on the port of entry,
advisories of all European, American & Canadian not to travel to
Pakistan. It is pertinent to mention here the example of UK visa which
is not available easily even for the frequent travelers and takes long
time but I am sure it’s temporary phase and soon the things will be
streamlined, most of the foreigner and their families went back to their
home countries of residence or operating the companies through their
regional offices in Dubai, Doha, Muscat and Singapore etc., Business
houses passing through very tough times reduce traveling
expenditures as we are discussing in perspective of travel business.
At one time 54 airlines (Scheduled or non-Scheduled) land at Karachi
airport now only 17 airlines most of them are regional airlines, no
American, European, African & leading far eastern carrier.

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Hotels are running empty less than 20% occupancy whereas
breakeven on 54% no inbound travel nowadays business or leisure.
An example of hotel industry in Pakistan which is directly related to
travel business infect all under one head of Hospitality, for the last 25
years no addition of hotel only four n half are hardly surviving in this
continuous unfavorable circumstances. Needless to give example of
Dubai, Mumbai and Colombo where it’s difficult to count them and
their categories 7 & 8 stars.

Set apart example of Gulf States, Sri Lanka & India are also facing
same problems as we do but despite that they are doing much better
than us both in travel and hotel business all the top names of airlines,
travel agents, hotels and other travel related product supplier are very
much there.

In general Hospitality industry is hardly trying to be alive in this
suffocated market and hoping for the good times to come where
every day there is news or rumor in the market that so and so airline
going to be offline from Pakistan. By giving examples of Sri Lanka &
India I would emphasize on the fact that apart from obvious reasons
for this chaotic situation I feel we are lacking on professionalism and
good governess when an orthopedic surgeon became Minister for
Petroleum and a airline pilot became MD for the national carrier what
kind of result anybody expect but to ruin and tarnish the remaining
image or credibility and drag the company on the verge of
bankruptcy. Hiring professionals from related trades on merit basis
can do miracle irrespective of the bad atmosphere and reoccurring
happenings in Pakistan, this is my firm believe . I got an opportunity
to work on deputation in 30 different countries all over the world with
more than 68 training and courses outside Pakistan

Despite all the odds we should be optimistic many agencies related
to big groups like XYZ Travel are still doing good business like;

                                                                Page 2 of 27
Princely Travels             Akbar Group of Companies
Princeton Travels            Lakson Group
Mackinnon Travels            P&O Shipping
Aga Khan Travel              Aga Khan foundation
Gerry’s Travel               Gerry’s Group of Company

These are the few examples only, they are all doing good business
the reason they are not concentrating on walk-in clients they have
solid Commercial Houses & Multinational in addition to their in-house
business of the group. I have been attached to this market since I
joined Japan Airlines in 1982 (minus ten years in-between outside
Pakistan ) most of the top agencies started operation in 80’s the good
old days when the earnings are really very hand sum and quick ,
agents submit their fortnightly report and got cash money as
kickbacks and not sharing commission with the client. I used to be
active member of BARIP (Board of Airline Representative in
Pakistan) for years. I used to be delegate of American England and
Canadian from travel trade side in Pakistan.

I am confident this is good time to start a agency with new spirit,
limited resources and penetrate in market with solid and firm steps
blended with sheer professionalism the valued clients expect
something extra from us in order to switch the business from their
respective designated travel agent or agencies some Commercial
Houses doing business with more than one travel agent. Being more
than two decade in this market I is confident to bring some top
multinational and commercial houses on our account.

I strongly believe professionalism, dedication, honesty, zealous and
courteous approach towards the customer can turn the stone. What I
feel professionalism is not there at all in the travel trade like other
countries where related qualification blended with experience is must
for the job. An example of Community based travel agencies like
Polani’s travel, Aero Travel, Prime travel, Aroma travel, Safi Travel
Super Travels, Universal Travels and countless other where staff
chewing pan in front of customer and being top agent in Pakistan due
to the fact that they are serving to their community, no Memon or

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Bohri community buy tickets other than few of these agencies. On the
other hand American Express, Princely, Oasis, Bukhari Bond and
Gerry’s doing colossal business since all the multinational companies
divided into these agencies they have comparatively better staff also
depute their sales persons to their productive client offices to facilitate
them. Very good example is Aga Khan Travel Division where 7 IATA
Travel agencies have there Travel Desk.

Establishing new agency we have two choices either to go through
whole process of getting license and IATA approval or buy IATA
agency license. Most of the Commercial clients hesitate to do
business with non-IATA agency due to many reasons and lack of
facilities like they can’t have ticket stock of an airline; they have to
send EXO (exchange order) to IATA agency for travel products.
Commission and kickbacks also diluted. Firstly, we have to get DTS
license than look for a better option to get the agency on faster track.

It is very difficult to get good productive account without getting IATA
approval. Also I will try to get offline or online General Sales
Agency. I have vast experience here and abroad to apply and get
GSA or PSA of an airline; it can make lot of difference to an agency.

Since I am encompassing the complete scenario of this market in
perspective of GSA business of an airline or travel related product, it
is worth mentioning here the example of Akbar group. The owner of
Akbar Group Mr. M.I.Akbar (my colleague when I joined JAL) started
agency business with one offline GSA and grew up to 17 offline n on-
line GSA and a private airline Shaheen Airways. This is an example
of individual the group can do lot better I emphasize the value of GSA
for an agency when I was looking after different airlines in Pakistan
and other countries I appoint GSA with the three main ingredients
Group Credibility in the market, Financial health and professionalism .

Nowadays Hajj and Umrah packages are very productive for the
agency. I have known the related agencies in UAE and Saudi Arabia
as well, after getting the local documentation and local license from
the local bodies I will try get collaboration with them we can get good
revenues generate through

                                                                  Page 4 of 27
a)   Selling packages (leisure)
b)   Commercial clients
c)   Umrah packages
d)   Selling other travel related product like hotel, car rental, rail
     packages etc.

                                                             Page 5 of 27

 Sales of 14 million by year three.

 Maintain margins on all online and offline

 Develop strategic alliance with service providers
  nationally and internationally like hajj and umra
  packages. Tour operator both inbound and out

 Try to get GSA of an airline (offline or online)
  and   partnerships   with   Top      class   service
  providers like BTI and Thomas cook.

                                                    Page 6 of 27

XYZ Travel is a travel agency that specializes in
package tours and travel. It will provide consulting and
custom travel arrangements and packages, MT’s
mission is to become the foremost provider of leisure
and Umra package travel to the individuals and groups
both from Commercial houses (local) and multinational
companies and spread the wings to Lahore and
Islamabad also, XYZ Travel seeks to connect holiday
makers    and    veterans    with   service    providers,
accommodation, activities, car rental that fit the clients
desires, budget and skill levels.

                                                      Page 7 of 27
             Keys to Success

 Effective segment and target package tours and
  travel within the larger travel market.

 Grab some good commercial houses with volume
  of business domestic and international particularly
  Japanese firms, foreign banks and pharmaceutical

 Introduce Hajj Umrah packages in collaboration
  with local agents successfully position ourselves as
  package tour specialist.

 Communicate the differentiation and quality of our
  offering through personal interaction and local print
  and other media.

 Develop    a   repeat   business    base   of   loyal

                                                  Page 8 of 27

XYZ Travel provides individual and group travel to leisure and
corporate clients. Focus will be on Commercial houses. Services and
products provided by MT include travel consultation, pre-arranged
tours, custom packages, reservations for lodging, rental cars, rail
passage etc. XYZ Travel seeks to differentiate itself as the premier
tour specialist travel agency in the greater hub of Commercial

                        Sales Literature

Brochures for travel locations, rental car companies, hotels,
entertainment etc are obtained from the wholesale houses and
service providers with whom XYZ Travel deals. Brochures for MT are
handled by a local graphic arts Company and are mailed to potential
customers upon request. Additional literature such as individual print
ads and sales promotion materials (giveaways) will be utilized as
needed. XYZ Travel will maintain the database from which customary
contact information will be drawn.


XYZ Travel will establish relationships with airline and tour operators.
Four major carriers have been selected on the basis of ticketing on
these airlines to raise the profit in the shape of regular commission
and slab discount which has been float in the market through
negotiation which is differ from agent to agent. Sourcing will be
continuously evaluated. MT will take advantage of trade shows
travels industry publications and offer sources of industry related
information to monitor the quality of its offering.

                                                               Page 9 of 27

XYZ Travel will rely on a Computerized Reservation System (CRS)
which ever best available in the market for all client reservations. The
CRS enables travel agencies to identify what the customer is looking
for and make that information available quickly it also increase the
speed and efficiency with which MT can communicate with supplier,
like the local practice here all airlines have there fare list on the
system. In addition, the CRS makes customer date storage and
retrieved relatively simple. MT will also make use of the internet for
market research and communication.

                         Future Services

XYZ Travel may in the future open branches in Lahore and
Islamabad. Engage in Hajj Umrah Package. Major commercial house
on their list with full services including MT’s travel desk at their place
like the other top travel agents practicing like Oasis, Princely,
Bukhari, Polanis and Gerry’s. XYZ Travel may participate in
additional segments of the travel market like getting online or offline
GSA (General Sales Agency) of airline and Travel Services
providers like BT and Thomas cook. XYZ Travel establishes itself as
Tour specialist.

                         Market Analysis

XYZ Travel plans to focus on its initial efforts on getting maximum
Commercial Houses and on the Package Travel. Package Travel falls
primarily under the leisure travel category. Revenue from leisure
travel earned by the travel agencies exceeds 2 billion rupees

                                                                Page 10 of 27
                     Market Segmentation

XYZ Travel target customers will be from Commercial Houses and
Multinational executive, using our contacts to try our services since all
the Commercial Houses has its own designated agency in other
words we have to dig out our share through sheer professionalism
attitude towards valued clients.

                                                               Page 11 of 27
                Target Market Strategy
a) To be competitive in pricing with other agencies.

b) Implementation of effective marketing/sales strategies to
   achieve desired market share.

c) Increase the traffic flow on high yield long haul sector as the
   traffic grows

d) Concentrate on Commercial Houses and Multinational for
   corporate business.

e) Short seminars will be conducted to enlighten with the facilities
   available for necessary frequently guidance/information for the
   Commercial client.

f) Penetration will be made through various channels to approach
   the Elite Class by making contracts with members of different
   social clubs e.g. Sindh Club, Marina Club, Golf Club, Boat Club

g) In order to achieve these goals, XYZ Travel needs to focus on
   the three key areas of:

     a. Effective segmentation and targeting of MT within the
        longer travel market.

     b. Successfully position us as Tour operator specialists.

     c. Communicate the differentiation and quality of our offering
        through personal interaction. Frequent visits and regional

     d. Develop a repeat business base of loyal customers in
        order to create sufficient sales.

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                Competitive Comparison
The travel agency market is competitive and technology the
internet and computerized Reservation System (CRS) currently
Amadeus, Galileo and other systems are quite effective with full
options of ticket, car and room booking. Airlines have taken
advantage of the internet by offering tickets online at discounted
rates like E-tickets.

XYZ Travel is researching the market to identify potential
opportunities for future sales in the rapidly changing environment
XYZ Travel’s long-term goal is to establish itself as tour operators
both in bound and outbound (presently inbound is not there at all
due to country situation). This goal does not prohibit XYZ Travel
from particularly in additional segments. It does, however, provide
a corporate focus and a differentiated offering.

XYZ Travels target elite class customers in from corporate sector.
Those who are earning 5 to 6 million yearly normally enjoy
holidays at least once a year XYZ Travel target market is an
exploitable niche and XYZ Travel will provide a specialized and
thus differentiated services.

MT established relationships and good support with providers of
travel related product and services.

XYZ Travel will take advantage of trade shows, travels industry
publication and other sources of industry related information to
introduce and to monitor the quality of its offering.

                                                          Page 13 of 27
Although there are many competitors in the market but will seek to
acquire our market share through sheer professional approach
towards valued customers pricing strategy and service standards.

The agency will also pursue an aggressive marketing campaign
through personal visits and relationship which developed through
the year of my travel industry experience with more than 7 carriers
and leading travel agencies which include Japan Airline, Czech
Airline, Air Seychelles, Uzbekistan Airways, Japan Asia and
DNATA. Sales persons will visit daily to commercial houses. XYZ
Travel’s goal is to develop personal familiarity between its
employees and the Commercial clients.

                                                          Page 14 of 27
             Service Business Analysis

In other developed countries travel and tourism industry is the
third largest retail industry whereas in Pakistan this industry
isn’t even consider as an industry. The market is separated
into two main categories, business and leisure travel. Each
contributes about 45% to total revenue. The market is further
separated into domestic and international travel. Domestic
tickets issued in volume can contribute much to the revenue.
Leisure travelers are classified according to the types of trips
they take, income, or age.

The four primary leisure travel groups are:

1) Sight seeing trips, Honeymoon.
2) High Income Travelers.
3) Budget-conscious Travelers.
4) Families, Students and Seniors.

                                                          Page 15 of 27
                        Market Needs

Although there are very few countries left who are giving tourists
visas easily otherwise all other countries asked from the bank
statement to the forefathers. Customers look to the agency to
provide them with sound advice for a competitive price. Time is
precious commodity. XYZ Travel can save the customer time and
money and help to ensure that they are satisfied with their
vacation arrangement.

                        Market Trend

One notable trend in the travel industry is increased deregulation.
Deregulation has increased the need for differentiation and has, in
many cases, lowered the prices of airfare and other travel related
services. Additional trends include caps on agency commission by
many of the larger airlines from 9 to 5 percent commission on the
tickets resulting reduction in profit margins.

                       Market Growth

The travel industry is stagnant not growing on the normal pace
due to many reason international recession and local unrest.
Despite the fact leisure and Umrah travel considerably increased.

                                                          Page 16 of 27
                   Corporate Business

According to a survey in 2007, 151 multinational and recognized
Pakistani companies are selected on a random basis whose travel
entertainment budget exceeds PKR 40 million. Based on 1600
outlets travel and entertainment expenditure on the corporate
sector valued at Rs23 million, 1600 companies in Pakistan spend
approximately 5600 million annually on the conference and
incentive travel of their employees which is quite encouraging.
Pharmaceutical Companies are on top of the list.

Travel Policies

 In most organizations Director’s departmental travels and
MD/Chairman’s travel first class/business class while 71% of the
managerial and other category of staff using Y class.

Travel Management

95% arrangements are made through travel agent.
20% of the companies have their own travel department,
97% of Pakistanis use the services of one or more outside travel

Statically a multinational spend 4 million annually on incentive
travels or conferences abroad, 29% multinationals have held
conferences abroad, Dubai, Cairo, Colombo, Bangkok, Kuala-
Lumpur and Hong Kong being popular locations.

We shall promote incentive and leisure traffic. Regular sales call
will be made to concerned persons.

                                                         Page 17 of 27
          Competition and Buying Patterns

Competition is very tough among the agencies due to the
prevailing circumstances. Customers and Commercial Houses can
switch the agency on hundred rupees difference. Since very
limited disposable income influence the decision on individual and
Company base.

                   Business Participants

The Travel Agent Association of Pakistan(TAAP) report 212 IATA
agent in Karachi and Sindh and 123 non-IATA agent in addition
there are many agencies not affiliated with these associations.

              Strategy and Implementation

In order to reach its goal of becoming the premier Package Travel
agency (leisure and Umrah) XYZ Travel will adopt the following

1. Establish XYZ Travels reputation as a differentiated, especially
   providers of Package travel. This will accomplished through a
   diverse marketing communication program at XYZ Travels
   target marker utilizing various channels.
2. Provide unparalleled service to the Corporate/Commercial
   clients in order to gain repeat business and built trust. This will
   include providing superior services in all phases of the
   transaction including timely follow through.
3. Aggressively promote leisure and Umrah beside the grabbing
   good Commercial Houses and Multinational Companies.

                                                            Page 18 of 27
                     Value Preposition

XYZ Travel employees will be confident in their ability to meet the
needs of the customer’s enthusiasm for the tour and other
packages XYZ Travel offers. The value added of XYZ Travel’s
offering is its knowledge and expertise, competitive rates, and
specially focus on packages travel which translate into increased
price competition.

                                                          Page 19 of 27
                        SWOT Analysis


1. XYZ travels belong to XYZ International Group a well known well
   established reputable company engaged in diversified businesses.
2. Utilize my expertise that I have built up over the 25 years to
   manage and maintain the highest levels of standard whilst also
   minimizing cost.
3. Successful record in the industry the diversified experience and
   the network of valuable connections developed will contribute
   greatly to XYZ Travel success. Specialize in leisure travel & Tour
   packages over 68 trainings & Courses on my credential.
4. Niche destination knowledge commonly visited by the Pakistan.
5. Excellent rapport with travel products suppliers.
6. Strong consortia membership and well placed in community civic
7. Good contacts and strong consortia membership.
8. Reputation in marketplace commercial houses and multinationals
   is strong.
9. Excellent Customer’s list and destination specialist designation.

                                                              Page 20 of 27
  1. New player in a competitive and limited market.
  2. No IATA approval no DTS license.
  3. Staff needs trainings parallel to reputed agency staff.
  4. Limited designated travel trained, educated and experienced
  5. Shortage of Tourist Tradition.

 1. Well prepared to cater corporate clients.
 2. Develop a best–in-class website.
 3. Collaboration with wholesalers for Hajj & Umrah packages.
 4. Best time to get General Sales Agency of an airline most
    probably offline and also agency for travel related service
 5. Pent up demand for travel after this temporary sluggish travel
 6. Series of articles time to time in travel related magazine and
    papers gets lot of attention.
 7. Diversify its communications efforts through own World Wide
 8. The potential to integrate services and add branches in other
 9. Establish a new reputation for upscale elite class.
 10. Unfulfilled customer’s needs, new tour packages both inbound
     & outbound.

                                                               Page 21 of 27

  1. Unhealthy n unethical competition due to non professional
     category of agents in the market.

  2. Agents spoil the market by sharing commission 7 kick back with
     the clients.

  3. When the airlines were deregulated, price competition increase
     every airline has its own rules some float their fare list with 5%
     other on 9% remaining just service charges.

  4. The internet has provided a sales medium for consolidator who
     competes on price and has also given customer’s the ability to
     plan and arrange trips for themselves.

  5. Present circumstances have reduced disposable income of an

  6. No inbound travel, neither mass tourism like the Japanese
     groups nor individual tourist due to the country’s situation.

  7. Competitive market could increase market cost.

  8. Market not yet saturated.

                                                             Page 22 of 27
             Forecasted Profit & Loss Statement

Yearly Sales                 140000000
Yearly Profit (7%)             9800000
Monthly Profit                  816000

Profit per month                                  816000


      Salaries & benefits                325000
      Rent                               50000
      Marketing promotion                50000
      Utilities                          70000
      Insurance                          20000
      Vehicle exp                        30000
      General expenses                   20000
      Entertainment                      30000
      Financial expenses                 10000
      Repair n maintenance               20000
      Others                             20000

      Total Operating exp                645000

Net profit                                        171000

                                                    Page 23 of 27
Organizational Chart

                       Page 24 of 27
Projected Sales by year

                          Figures in Millions
                                                Page 25 of 27
Projected Sales by month

                           Figures in Millions   Page 26 of 27
Profit by year

                 Figures in Millions   Page 27 of 27