Tour Operators are the key player in the massive tourism market. Their role is vital not only for themselves but for the Hotels they work with and even for the countries that they bring clients to. Tourism is such an important sector for some countries the macro economical figure, labor is depended on Tourism.

For tourism, Tour Operators are the key player. Recently with the failure of Thomas Cook, we figured out that with more clear picture.

Thomas Cook's failure also proved to us that the long background or its reputation on media may not give us the correct picture and nearly every Tour Operator has the potential to fail.
I think the worst consequence of Tour Operator`s failure for a Hotel is, the Hotels that worked with that Tour Operator for a long time, lose its contact to nearly all tourist supplier agents in that country. Because when Tour Operator operates from a country, it doesn`t collect clients via its own offices. Mostly they work with the Sale Agents that are across the country in Shopping Malls, cities, villages, streets, etc.

Now having said these let's have look at Tour Operators way of operating:
Can any tour operator fail?

Yes. Unfortunately, every tour operator has the potential to fail. This is because of nature as any business may fail if not managed and operating the way that business does. But for Tour Operators, the possibility is not because of their business investment, capital return or difficulty of managing the risk.

Tour Operating is a business that flows with the least capital investment but works with the largest amount per sale. They operate from a few hundred USD PP for every booking with almost no capital investment. Every booking is weeks earlier than the client wants to go.

How does the Tour Operator work for both sides?

For collecting clients, the Tour Operator works with Sale Agents across the country they bring from. They don’t have their own office everywhere with salary paid personnel, tax, etc. Instead, they create a chain of Sale Agents network which each is individual for their expenses across the country. The Tour Operator pays a certain percentage of commission of Sale Agent bookings only. So if there isn’t booking and its payment is received/collected, there is no payment. The Tour Operator usually hires a few persons only who are in charge of contacting Sale Agents in certain regions only. With today’s internet technology, there is no need for these personals even.

The Tour Operators hire planes for air traffic, organizes bus transportation for their clients, bring clients to Hotels that they don’t own and payment is for clients that they bring only. but they can see the booking forecast weeks before flight and can cancel the contract whenever necessary. (seldom the Tour Operator makes a contract with Hotels based on guaranteed payment whether clients come or not but that is only for Hotels that they are sure they will and they do).

Overall Tour Operators potentially have no reason to fail in terms of normal business workflow. Because they don’t invest anywhere heavily that will bring them to fail.
Is the tour operator I work with Safe?

There is no way for a hotelier to control a Tour Operator whether is safe or not. The only thing Hotelier can do is to pray for the Tour Operator to keep operating. Hoteliers don’t see the sale forecasts, the Tour Operator`s payments, etc.

What consequences Hotelier may face If the Tour Operator fails?  What is the worst scenario of impact for its failure?

The consequences that a hotelier may face when the tour Operator fails can be dramatically painful. The failure of a Tour Operator may bring Hotelier down very easily with millions of USD. The hotelier has an investment of millions of USD, 100+ of employees, 100+ of suppliers and all will be affected painfully as a result of Tour Operator failure and the payments evaporation.

But assuming the hotelier keeps running, the pain will be long-lasting anyway. Because usually, the Tour Operators don’t accept working with Hotel that works with another Tour Operator for the same market. Tour Operator doesn’t want to have another Tour Operator as a competitor for the same market. That makes each Tour Operator monopoly for the market that is operating. For example, a British XXX Tour Operator will not accept the same hotel to have a contract with another British Tour Operator for the British market. In that case, when XXX Tour Operator fails, the Hotel needs to find a new Tour Operator for the British market. The new Tour Operator works with Sale Agents across Great Britan that don’t know the Hotel well to send clients. This is not a big loss for the Tour Operator because the Tour Operator cares about booking not booking to any specific Hotel. Booking to any Hotel, destination or country is almost the same for the Tour Operator. But it is totally opposite to countries, destinations, and hotels. Each wants the client to his country, destination or Hotel only.

What measures should Hotel take for the worst scenario?

The booking for clients that come for a vacation to hotels is made by Sale Agent and the client is brought by the Tour Operator.

For hotels to keep safe, the best is to have contact with SALE AGENTS. But this is not easy because Tour Operators don’t allow the two parties (Hotels and Sale Agents) to have direct contact with each other. All communication should go through the Tour Operator. There is almost no way to bypass the Tour Operator for direct communication. The only way is to work with the following new online Booking Platform.

What is new with HEBERI and why should Hotels and SALE AGENTS work? is a new online platform that connects Tourism Service Providers (Hotels, Excursion – Cruise Journey Organizers and Shopping) one side and Sale Agents on the other side.

Our aim is not to bypass the Tour Operators and make clients find the hotels for direct booking without tour operators. However, there are many online platforms already serving for client direct booking to hotels.

We believe the Tour Operators are the key player in the Tourism business and will keep being vital for a very long time. Because the business that the Tour Operator is doing is far beyond simple booking and making a profit. They provide enormous service to clients such as transportation, guiding services, etc. The client can reach the Tour Operator representative whenever need so and will receive assistance under any circumstance.
But one point is perhaps not the way Service providers want. Hotels have no contact with Sale Agents and they have no interference for their marketing.

This is exactly what we fixed for Tourism Professionals.

We made Hoteliers make their hotel's marketing to Sale Agents which will decrease the Tour Operator`s marketing expenses. It will also decrease the number of complaints from Hotels about not bringing clients as they expect so.

Simply the Tour Operator can ask HOTELIER to make his Hotels marketing, collect clients and they will bring when bookings are made. Then the hotel will see forecasts, expend its portfolio to new markets. It will also make it easy for Hotels to announce the Tour Operator whenever changed so that Sale Agents will know how to send clients.

On the other hand, we made it easy for Hotels to make their marketing by themselves and collect clients to their hotel individually or via the Tour Operators. This enables the hotel to announce or clarify the new Tour Operator for Sale Agents to know how to send clients.
With the hotel may offer an additional commission to Sale Agents to recommend to his clients. This is optional and is what the hotel offers only. Its payment is until the client appears.

What is new with HEBERI and why should SALE AGENTS work?

The Sale Agent is the real source of clients. Sale Agent is the one that the client knows before going. And Sale Agent makes his booking with different Tour Operators to different countries, destinations, and hotels.

We believe Tourism marketing should be straight to them. We also believe they deserve making additional activities 
reservations for their clients during their holiday too.

The client takes whichever Hotel the Sale Agent recommends.

Now we made it possible for the hotelier to conduct his hotels marketing directly to Sale Agent from his desktop, ask him to recommend his hotel and offer extra commission for his recommendation. The Sale Agent gets a booking commission from Tour Operator anyway. With it is possible to add some from the hotelier's side to attract more.

With the Sale Agent can conduct bookings to other activities at the holiday destination such as to conduct bookings for excursions or shopping. That increases the commission income for Sale Agents.

Published: 17, Oct, 2019 By Mehmet TUNG

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