Distribution Channels IN THE Tourism Industry PDF

Preview

Summary

DISTRIBUTION CHANNELS IN THETOURISM INDUSTRYDISTRIBUTION CHANNEL A set of independent organizations involved in the process of making a product or service available to the consumer or business user.  It moves goods from producers to consumers, it overcomes the major time, place and possession gaps...

Description

DISTRIBUTION CHANNELS IN THE TOURISM INDUSTRY DISTRIBUTION CHANNEL  

A set of independent organizations involved in the process of making a product or service available to the consumer or business user. It moves goods from producers to consumers, it overcomes the major time, place and possession gaps that separate goods and services from those who would use them.

TOURISM DISTRIBUTION CHANNEL 

It is an operating structure, system, or linkage of various combinations of organizations through which a producer of travel products describes, sells, or confirms travel arrangements to the buyer

DISTRIBUTION CHANNEL AND ITS FUNCTIONS

CHANNEL LEVELS

MARKETING INTERMEDIARIES

TOURISM DISTRIBUTION CHANNELS

SELECTING CHANNEL MEMBERS    

Knowing the needs of your customer Attracting channel members Studying economic feasibility Maintaining control

BUSINESS LOCATION

FRANCHISING 



Is a method of doing business by which a franchisee is granted the right to engage in offering, selling or distributing goods and services under a marketing format which is designed by the franchisor (Kotler 2008) Granting the right to engage in offering, selling, or distributing goods or services under a marketing format which is designed by the franchisor TO THE FRANCHISEE

ADVANTAGES Brand recognition Minimizes financial risks because of less chances of business failure National advertising and marketing plan Faster business growth Assistance in site selection

Architectural plans Standard operating procedure software and manual National contracts with suppliers Product development Consulting on managerial and technical concerns Access to a comprehensive reservation or delivery

DISADVANTAGES Fees and royalties are required Initial fees are quiet steep Return on investment might not be quick as expected Limits products and recipes to be sold Franchisee is subject to rules and regulations on operating hours and minimum volume of product are sold The franchisor’s performance affects the profitability of the franchise Limits the creativity of the franchisee in all aspects of the business Territorial disputes on franchisee agreements

network Established customer base TO THE FRANCHISOR Advantages Receives a percentage of gross sales Expands the brand without much capitalization Can achieve rapid growth through its franchisee Gets support for national advertising campaign Gets negotiating support for national contracts with supplies Takes advantage of economies of scale

Disadvantages Limits other options expanding distribution Franchisees must be monitored closely to ensure product and service consistency Poorly run franchise unit can reflect negatively on the entire board Limited ability to require franchisees to change operations strategies Franchisees want and need to have an active role in the decision making...