Unit 1 The Travel and Tourism Sector Solution

The Travel and Tourism Sector Solution

Unit 1 The Travel and Tourism Sector Solution



Diploma in Travel and Tourism

Unit Number and Title

Unit 1 The Travel and Tourism Sector

QFC Level

Level 4

Unit Code



The Travel and Tourism Sector has been prepared to understand the influence of supply and demand in the TUI Tour and Travel industry which is the world’s leading travel operator. The study will also demonstrate the factors that affect the demand in tourism sector. It will also analyze the positive and negative economic and social impacts of tourism. The study will also discuss the strategies that can be used by TUI industry to minimize the negative and maximize the positive impacts.

unit 1 Travel image


LO 3. Understand the effects of supply and demand on the travel and tourism sector

On the basis of the definition given by World Tourism Organization tourists are referred as the individuals who travel as well as stay at the numerous different places that are not within their usual environment and the main purpose of these people or individual mostly would be leisure, entertainment, medical etc. The analysis of this report presents the demand and supply scenario for the travel and tourism services and products.

3.1- Explain factors affecting tourism demand

Demand in the tourism sector is an essential element that needs special contemplation and specific management strategy in the travel and tourism industry (Aref, Redzuan and Gill, 2009). Demand in tourism sector can be defined as the number of tourists visited a specific tourist destination within a particular period of time. The major factors that affect the demand for TUI tourism products and services within the context of UK are described below.
Demographic- The modifying demography of customers has affected the demand because tourist is conducting great spending power that mostly includes larger number of young customers as well as great traveling frequency for customers (Evans, Campbell and Stonehouse, 2003). All these factors are determining the demand in a positive way because tourists are forming great spending on the activities of tourists.
Technological- Technological factors like availability of data and information on the internet along with this online reservation process has impacted demand because customers are now able to receive all relevant and important information as well as demand would enhance through enhancing and changing technology in TUI travel and tourism.
Fluctuated Currency Rate- This is the most significant factor in decreasing currencies rates for the destination nation would automatically attract larger and great amount of tourists or customers in exactly that nation because the money would have great value in that nation (Gelan, 2003). As for illustration of this, if rates of GBP would decline in comparisons to the US dollar then there would be a larger demand for the tourism and traveling services of UK in America whereas other nations have dollar currency.
Economics- This factor is quite important for TUI tourism as the economic situations in various nations would also affect the demand for TUI tourism products and services. In this fact a nation is bearing economic crisis then there would be less demand for the company’s products and services because tourists would be averse to create much more spending.
Political- A nation along with a great degree of political stability would have a great demand of tourists all over the globe (Goodall and Ashworth, 2013). Political stability is the most important reasons for enhancing demand from tourists in the UK.
Inflation- Inflation in interest rate would enhance entire pricing for the money and at the same time the customers’ would be willing to contribute less money along with great interests rates existing in the market.
Globalization- Enhancing trend of globalization, as well as the movement of customers and also service givers from one nation, to the other nation has allowed the trend in TUI tourism and travel company thus much more customers are traveling their destinations from one nation to the other nation (Globalization, 2016). This has formed great demand for the services and commodities in TUI Tourism Company in the UK.

3.2- Explain how supply has changed at TUI Group to meet the effects of demand.

It is significant for forming a balance amongst supply and demand of the TUI tourism services and products provided by a nation so that whole company can operate easily and smoothly. The authority and various shareholders in TUI Tourism Company would be putting constant efforts for striking a balance amongst the two factors. Supply of the TUI tourism services and commodities has been modifying on the basis of managing the condition easily as well as shareholders in tourism firm have answered positively to the enhancing demand (Regan, Carlson and Rosenberger, 2012). There are various factors that have been changed for meeting and satisfying demand for the tourism services and commodities and these elements are quality, kinds of products, technology, and provision for accommodation, seasonality, and services in TUI Tourism Company. There is enhancing pressure over accommodation for managing the enhancing demand as well as larger amount of accommodation is established at the tourists’ destinations (Scanlon, 2006).
Tour operations of TUI tourism firm has managed to enhance demand for the tourism services and commodities so that customers and tourists can be bale to receive appropriate information as well as benefits at these places. Service aspect and quality aspects are of prime significance for the customers in recent time and shareholders in Tourism Company have concentrated their attention on all these aspects of managing the demand for tourism services and products (Sharpley, 2006). Seasonality is demand for the services and commodities require to be handled by enhancing costing for the peak season as well as decreasing amounts in the offseason so that demand can be handled in offseason. Technology is one of the most important factors as it the allowing element for handling the demand for tourism services and products as with online reservation as well as the online information it has become smooth for the customers or tourists globally for availing all these services from their own nation only.

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LO 4. Understand the impacts of tourism

4.1 – Evaluate the main positive and negative economic, environmental and social impacts of tourism with reference to TUI Group businesses.

TUI group is considered as the fastest growing company in the world of tourism industries as there are various advantages as well as limitations of tourism activities on the other nation handling all these activities and functioning. Factors like, namely, economic, social and environmental would have positive factors as well as negative factors on tourism and Travel Company globally. The positive economic advantages of tourism and travel firm would contain economic growth, the inflow of foreign currency, government tax base, higher employment, enhancement in export industry and higher income for the other nation (Shaw and Williams, 2004). Negative effects of economic factors on TUI tourism and travel industry would contain the larger amount of living, demand for public service, the higher dependency of the economy on tourism firm, inflation rate, and property taxes.
In terms of positive environmental affects planning and control, maintaining and improving quality of the atmosphere, conservation of natural resources and community revival. Negative affects verified for the environmental factors would contain the degrading landscape, impact on the natural scarce resources, effect because of pollution and also the devastation of flora and fauna of the other nation. The social factors have positive effects on tourism firm in form of conservation of the heritage & cultural principles of a nation and restoration of monuments. Negative effects of social factors on tourism firm would contain loss of domestic festivals as well as the effect on the local tradition from the tourist entering for visiting.
Observing into the traditional and cultural aspects it can be identified and stated that intercultural understanding, as well as globalization of tradition, are the larger positive effects required by other nation by tourism activities when there are various negative effects of tourism activities for social factor like local skills, commercialization of the cultural events and loss of local individuality etc. So, the political, cultural, environmental, economic factors on the TUI travel and tourism group thus leads for helping other nation for understanding the analysis of entire advantages that would be required by tourism activities (Song, Witt and Li, 2009). Much more study of the advantages and limits for these factors would support for understanding the problems as well as the solution would be proposed for the limits of ant certain factors for creating forming the arrangement for solving the problems confronted in the organizational setting.   

4.2 - Explain strategies that can be used to minimize the negative impacts while maximizing the positive impacts TUI Group businesses.

For dealing with the negative outcomes and results of the different factors like economic, cultural, environmental and political aspects it is significant which appropriate and efficient strategies are created as well as executed in the setting of a certain other nation. Negative economic aspects can be reduced through implementing the strategy of handling local standards of lifestyle at a controllable level so that standard of lifestyle does not enhance much more for the local person living in the region. Much more local individuals should be involved in the economic policy and rules for providing advantages to them so that they can manage the enhancing amount (Song, Witt and Li, 2009). The strategy of change can be utilized for reducing the reliance on the tourism group in which there should be appropriate combination and reliance on various sectors so that in nay certain condition if any industry is not doing according to the expectation so there are no larger effects of this on the entire economy of a nation.
The negative environmental effect can be decreased through establishing the key policy and law in an environmental setting for resolving clash amongst access to natural resources as well as environmental deterioration of the natural resources. This rules and policy established as well as a committee hired for assuring the conservation of environmental factors that would assure the minimum probable environmental effects of the environmental factors on the TUI tourism group (Shaw and Williams, 2004). Additional environmental safeguard and security agencies require to be hired who would receive the reviews of a certain tourism place in the country and according to the negative effect analysis on these tourism activities future laws and policies considering the environmental effects for tourism sites would be established and grow. Negative traditional and cultural effect can be reduced through improving a quite strong host nation culture and tradition that can have an excellent understanding of another tradition and culture coming in contact to which culture by tourism activities but individuals should be dedicated to the implementation of their own tradition and culture. This would support individuals in the host nation for implementing their own culture and not getting encouragement from the other culture as carried by tourists coming from various regions of the world.


This report discusses the influence of supply and demand in the TUI Tour and Travel industry which is the world’s leading travel operator. The study also demonstrates the factors that affect the demand in travel & tourism sector. It also analyzed the positive and negative economic and social impacts of tourism. The study also discusses the strategies that can be used by TUI industry to minimize the negative and maximize the positive impacts.


Aref, F., Redzuan, M. and Gill, S. (2009). Community Perceptions toward Economic and Environmental Impacts of Tourism on Local Communities. Asian Social Science, 5(7).
Evans, N., Campbell, D. and Stonehouse, G. (2003). Strategic management for travel and tourism. 1st ed. Oxford: Butterworth-Heinemann.
Gelan, A. (2003). Local economic impacts. Annals of Tourism Research, 30(2), pp.406-425.
Globalization. (2016). International Journal of Psychology, 51, pp.647-651.
Goodall, B. and Ashworth, G. (2013). Marketing in the tourism industry. 1st ed. Hoboken: Taylor and Francis.
Regan, N., Carlson, J. and Rosenberger, P. (2012). Factors Affecting Group-Oriented Travel Intention to Major Events. Journal of Travel & Tourism Marketing, 29(2), pp.185-204.
Scanlon, N. (2006). Stakeholder Response Strategies to Climate Change Impacts on the Economic and Environmental Sustainability of Tourism Destinations. Tourism Review International, 10(1), pp.103-111.
Sharpley, R. (2006). Travel and tourism. 1st ed. Thousand Oaks, CA: Sage Publications.
Shaw, G. and Williams, A. (2004). Tourism and tourism spaces. 1st ed. London: SAGE.
Song, H., Witt, S. and Li, G. (2009). The advanced econometrics of tourism demand. 1st ed. New York: Routledge.