Tourism Chapter 20A – Fundamentals of Travel Agency and Tour Operation Business

NIOS Class 12 Tourism Chapter 20A Solutions

INTEXT QUESTIONS 20.1

1. What is meant by a travel agency?

Ans: A travel agency sells packages to wholesalers and earns revenue through the commission, acting like a retail store for travel services.

2. Why are travel agencies and tour operations called intermediaries?

Ans: Both are called intermediaries because they bring together clients, provide principal services, and strengthen the selling and buying process, both for the customer as well as the hotels.

INTEXT QUESTIONS 20.2

1. Mention the two major types of travel agencies.

Ans: A Wholesale Travel agency and a Retail Travel Agency.

2. What is meant by a retail travel agency?

Ans: It sells tourist products directly to the tourists.

3. What is the mark-up price?

Ans: The difference between the retail price and the wholesale cost is known as the markup price.

4. What is a wholesale travel agency?

Ans: It buys service components in bulk from different suppliers, designs, packages, sells, and resells them.

INTEXT QUESTIONS 20.3

1. Who is a tour operator?

Ans: A tour operator is an organisation, firm or company that buys travel components from different services, assembles them into tour packages, gives them their price tag, and then sells either on its own directly to clients or through other intermediaries such as retailers.

2. Mention the different types of tour operators.

Ans: Domestic, inbound, outbound, and ground operators.

3. What is the difference between inbound and outbound tour operators?

Ans: An Inbound operator handles foreign tourists and an outbound operator handles tourists going to foreign countries from a host country.

4. Who is a domestic tour operator?

Ans: Operates within a host country and handles domestic tourists.

5. List some of the ground services.

Ans: Local transport, instructors, guides, events, car rentals, entertainment services, etc.

INTEXT QUESTIONS 20.4

1. Who earns more revenue on commissions: a tour operator or a wholesaler?

Ans: A retail travel agency earns more revenue on commission.

2. List any two differences between a tour operator and a retail travel agency.

Ans: 

Tour Operator	Retail Travel Agency
It is a wholesaler.	It works as a retailer
It creates its products.	It follows a tour itinerary and, as such, acts as an intermediary
It is located in megacities	It may be anywhere in small towns, sub-towns, and cities.

3. Mention any two important features of a Wholesale Travel Agency.

Ans: 

• (i) It does not sell package tours directly to clients.
• (ii) It makes bulk purchases of services and assembles them to sell in packages.

Terminal Exercises

1. What is meant by a travel agency and a tour operator?

Ans: A travel agency is an organised service provider in the travel industry. It means a travel agent is responsible for organising travel. 

• It provides a link to the suppliers of services with the tourists.
• It acts as a retail store for both suppliers and clients.
• It plays the role of an active connector for the delivery of end service.

A tour operator is, hence, an organisation, firm, or company that buys travel components from different service providers, combines them into tour packages, and gives them its own price tag, and then sells either on its own directly to clients or through other intermediaries such as retailers.

• A tour operator buys (or owns in some cases) a high volume of travel services across carriers, accommodation, and services.
• These services are then assembled into packages for purchase by the consumer.
• The packages are sold via travel agents (independent or owned) or through the phone and the internet.

2. Who are inbound, outbound, domestic, and ground operators? Explain with examples.

Ans: 

• Inbound Tour Operators: Inbound tour operators are those operators who handle inbound foreign tourists in the host country, provide them various services on their arrival and departure, such as transfer, accommodation, transportation, sightseeing, entertainment, currency, insurance services, etc. They are also called as incoming tour operators as they specifically operate for handling incoming foreign tourists or guests.
• Outbound Tour Operators: They operate package tours to foreign countries/overseas from a host country. These operators are specialised in promoting and designing multi-national tours. The outbound tour operator sells a package tour to an individual or a group of people from their own country to another country or a number of countries for a specific pre-decided period and destinations.
• Domestic Tour Operator: Domestic tourism in India is scaling up enormously. The domestic market has witnessed attractive growth rates as large players in the travel industry are aggressively entering and promoting this market. Leading tour operators usually focus on the international market where margins are higher, but now, in addition, they are floating new packages to create a niche in this segment to tap the vast potential in the domestic market.
• Ground Handlers/Operators: Ground operator is also referred to as, ‘reception operator’, ‘destination management companies’, ‘reception operator or ‘handling agencies’. These operators are generally expected to provide ‘land arrangements’ at a particular destination. Thus, a ground operator who provides the services required by large tour companies where they do not have a local branch/office or are not dealing at the source with the principal suppliers, such as hoteliers, transport operators, car rentals, entertainment organisations, and so forth.

3. Differentiate between retail and wholesale travel agencies from the tour operators.

Ans: 

Retail Travel Agency	Wholesale Travel Agency
Works as a retailer and sells package tours on behalf of the wholesaler	Does not sell package tours directly to clients
Is an intermediary between tour operators and tourists	Makes bulk purchase of services and assembles them to sell as package tours
Plans sightseeing tours and excursion tours, airport transfer, check-in and check-out time in the hotel	Is less inclined to perform ground services
Plans sightseeing tours and excursion tours, airport transfer, check-in, and check-out time in the hotel	May deal with one specialised component of a travel product
Acts as a local agent to confirm and reconfirm the services	Size of the business, the operational area is limited, and multi-service capacity is low
Works on commission from principal suppliers	Size of the business, the operational area is limited and multi-service capacity is low

4. List out ground services and mention how they play an important role in the travel industry.

Ans: Ground operator is also referred to as ‘reception operator’, ‘destination management companies’, ‘reception operator or ‘handling agencies’. These operators are generally expected to provide ‘land arrangements’ at a particular destination. 

• A ground operator who provides the services required by large tour companies where they do not have a local branch/office or are not dealing at the source with the principal suppliers, such as hoteliers, transport operators, car rentals, entertainment organisations, and so forth.
• The reception operator secures, coordinates, supervises, and handles accounts/ payments of all services related to the tour in their region/area.
• His services are invaluable for an efficient and successful operation of an inclusive group, as well as foreign independent tours.

Additional Study Materials

• NIOS Class 12 Tourism Syllabus Bifurcation
• NIOS Class 12 Tourism Sample Question Paper
• Chapter 16. Human Resource Management-I
• Chapter 17. Human Resource Management-II
• Chapter 18. Communication and Personality Development
• Chapter 19. Tourism Marketing