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ANALYSING SUPPLY ISSUES IN TOURIST TRANSPORT - Coggle Diagram
ANALYSING SUPPLY ISSUES IN TOURIST TRANSPORT
THEORETICAL PERSPECTIVE ON TOURISM AND TRANSPORT SUPPLY ISSUES
Tourism supply
Tourism sppuly is a complex phenomenon because of both the naure of the product and the process of delivery
It is a composite product involving transprt, accommodation, catering, natural resources, entertainment and other facilities and services
It cannot to be stored, canot ve examined period to purchase, it is necessary to travel to consume it, heavy relian is placed on both natural ans human-made resource and number of components are required
The main principles outlined focus on four market situations
Perfect comoetition
Contestable markets
Monopoly
Pligopoly
Perfect Competition
Substantial number of consumers anf firms, implying that neither can effect the price of an undifferential product
Free entry to and exit from the market, assuming that there are no barries
Market are not perfectly competitive
Contestable markets
Insignificant entry and exits costs, so that there arenegligible entry and exit barriers
Information and supply conditions are available ro all producers and producers cannot change prices
New and established firms are able to challenge rival businesses through pricing strategies
Monopoly
A major business or firm is able to exercise a high level of control over the price of the product and level of output
Firms operating in a monopolistic market charge prices above the average cost of production to generate high profit levels
Domestic air and rail networks operate operate under monopoly conditions
A monopoly condition may be more beneficial than competition, as in the case of deregulation
Regulation be the state is normally imposed to prevent higher prices and supernormal profits
Oligopoly
A limited number of producers dominate that transport sector
Tourism has a highly dualistic imdustrial structure which is polarised between large numbers of small firms and a small number of large companies
In an oligopoly
Each firm controls its price and output levels
There are entry and exit barriers
In a ideal world
The profits are maximised for all producers
Oligopolies could lead to a monopoly and higher profits for producers if firms restricted the supply
In the internaltional market
Some route are competive
Being served by many carriers, at least two carriers
The structures of the bus, coach and trail sectors are similar to that of air travel
A large number of small firms operate in the transport sector a competitive market exists
A range of criteria needs to be investigated in different market conditions
The number and size of firms
The extent of market concentration
Entry and exit barriers
Economies/diseconomies of scale
Costs of capital, fixed capital and costs of operation
Price discrimination and product differentiation
Pricing policies
THE SUPPLY CHAIN IN TOURIST TRANSPORT SERVICES
Research has focused on established areas of tourism and transport supply, notably
Descriptions of the industry and its operation, management and marketing
The spatial development and interactions that characterize the industry at different geographical scales
The analysis of a firm or company is characterised by certain relationship within the organisation and with its purchasers or consumer
Commercial transactions are based on agreed conditions between the parties
Transaction chanins develop to link the tourist with the suppliers of services in tourism
The significance of the "chain of distribution" for transport and tourism services
TRANSACTION ANALYSIS
The nature of the specific supply chain depends upon a wide range of factors
Internal
External
Transaction analysis illustrates the significance of "agent" in the system, corporate policy in transport provision and contractual arrangements in the supply chain
One of the critical issues in the distribution system for the seller is access to superior information on available services
The nature of corporations controlling the transactionchain to
maximise profit by eliminating costs
Reduce the price to the consumer to boost market share
Increa their level of concentration in the tourism industry
Company strategies often pursue horizontal and vertical integration in the tourism and transport sectors
INTEGRATION IN THE TOURISM SECTOR: IMPLICATIONS FOR THE SUPPLY OF TOURIST TRANSPORT
Tourism supply chain management
Many of these supply chains are managed by business-to-business relationships
Tourism supply chain management is more specific to the management of tourism supply
Abouve all better coordination of the supply chains assists in improving relationships
TSCM can be used to assist in profitability, quality assurance and improvement of market share
Horizontal Integration
Two enterprises with the same output combine to increase the companies'control over output
It can occur through mergers, acquisitions, collaboration, franchising, agrements.....
Vertical integration
Occuring when anterprise with different interests and involment
Integration in tourist transport operations, vertical ownership, may help to reduce costs
Analysing annual reports: Company accounts
An annua report is used by companies to provide a review of the year's activities
Company account that are prepared within accounting guidelines
Company accounts contain messagrs that use specialist jargon to deal with a complex stuation
Two key elements within company accounts
A balace sheet
A profit and loss acount