Who's Who in Tourism

Private Sector Tourism

See also:

• Public sector tourism
• What does it mean for tourism businesses

There are lots of different businesses operating in tourism. Whilst there is no structure, as such, generally businesses operate at a particular level or place in the market.

What they all do

They all sell to consumers. They never used to, roles used to be more clearly defined, but the internet has changed all that. In addition, they do the following:

Product Providers
At the bottom we have the providers of products and services, the tourism businesses (accommodation, attractions, restaurants, guides, etc) and the travel providers (airlines, trains, car hire firms etc). These businesses actually provide the products that consumers want to buy. They sell direct to consumers through their own websites and premises, but they also sell to consumers via other businesses, like tour operators, travel agents, hotel booking agents, ticketing firms and so on.

Packagers and Wholesalers
In the middle we have the packagers and wholesalers. They are:

• tour operators (like Thomsons, First Choice etc) who create packages to be sold either direct to the consumer or via travel agents
• tour organisers (also called ground handlers) who have the on-the-ground contacts with the tourism businesses and the local knowledge, and can put together the packages
• consolidators/aggregators (like SuperBreaks, Active Hotels, English Country Cottages) who provide marketing (and sometimes management services) for a large number of individual businesses

These organisations either actually bulk-buy the products up front from the providers (literally buy attraction tickets, flights or book and pay for rooms or units) and then resell them to consumers, or they enter into an agreement with the product providers to sell on their behalf for a mark-up or commission. These packagers and wholesalers sell direct to consumers (eg Thomsons, Active Hotels, English Country Cottages) and/or they sell via retailers and distributors.

Retailers and Distributors
These businesses sell to the consumer, they are the retail outlets for the packagers and wholesalers, and, more recently, for individual businesses. Retailers can be travel agents (ones with actual shops in the high street or online ones like www.tripadvisor.co.uk or www.expedia.com) or distributors who just gather together the content and make it available at websites and retail outlets for consumers to book. Distributors are distinguished from travel agents in that, although they often have a retail outlet themselves, eg a website, and therefore act like a travel agent, they also make it possible for their content to appear at lots of other websites or retail outlets, through distribution technology.

Changing roles

The most fundamental change over the last few years has been, of course, the internet. The biggest impact this has had is that the roles are no longer distinct: everyone sells to everyone else, especially the consumer. Tour operators have become travel agents and distributors. Thomson, for example, owns high street travel agents, has its own website www.thomson.co.uk where it sells to consumers, and pushes its content to lots of other websites. Hoseasons is another example. Look at their website: www.hoseasons.co.uk. If you scroll down the home page you can see they are selling direct to consumers, there is a travel agents log-in button and, if you go right to the bottom and click on 'Affiliates' you can see that anyone with a website can display Hoseasons content and earn commission from any sales made.

Next in this article:

• The implications for tourism businesses