The Travel Business in Australia - Essay Example

Name: Course: Institution: Date: The Business Entrepreneur Introduction Tours and travel industry in Australia is one of the fasted growing sectors within the Australian economy. This is based on the understanding that Australia is both a local and international tourist destination (Tribe 119). In addition the services that companies and different tours and travel companies offer can be attributed to high level of competition and the high levels of professionalism among employees and the management in this industry (Tribe. 119). Through the involvement of the government to ensure the implementation of policies and legislations that create a competitive and safe environments to conduct business, the Australian tours and travel industry is currently envisioning the best methodologies that can be used in the development of lasting solutions towards emerging challenges such as the threat of terrorism, the possibility of a global financial crisis and the gradual damage caused by the effects of climate change on natural tourist destination sites. Spencer Travel is an SME in the Australian tours and travel industry. The company has been involved in different marking operations for tourist of local and international origin to travel to Australia as a holiday destination. Through its online platform the Spencer Travel organizes for travelling services, accommodation services and possible tourist destination sites that one can visit while in Australia. Throughout its mandate, the company endeavours to enhance the travel experiences of its clients through personalized attentive services. Furthermore, Spencer Travel envisions realizing this mandate through open communication and the act within the requirements of passion in every turn. The main objective of this report is to conduct a situational and financial analysis of Spencer Travel. This will be through an analysis of the business situation in terms of its strength and weakness, market positioning and possible developments to boost its position in the market. Critical appraisal of the tours and travel industry in Australia Tours and travel is one of the most successful industries within Australia. The sector provides the country with about $ 35billion in its Gross Domestic Product. The industry is also a major employer (Lawton & Bruce 2010, p. 69). Tours and travel industry is highly dispersed and has made it possible for the industry to make valuable contributions to different developmental initiatives within the country. This is not only in terms of employment but also in relation to infrastructural development (South Australian Tourism Commission 18). The highly competitive environment in the tours and travel industry makes it possible for the Australian government to institute measures that will help in the development of the industry (South Australian Tourism Commission 21). Spencer Travel envisions expanding its services in terms of forming partnerships with different airline and other travel agencies within Australia and ion the international platform. SWOT analysis In terms of strength, the company has already established itself as one of the major players in the tours and travel sector. The company operates through its online platform to market its services that enable clients to register on the online platform. This has made it possible for individuals in areas separated by geographical barriers to acquire information on the Australian tourism sector. In terms of weakness, Spencer Travel has been has relatively fewer staff compared to its competitors. This makes it short of manpower which is essential to ensure growth and development of the company. Furthermore, the company only focuses on Australia as the tourist destination and has failed to expand its services to other countries. In terms of opportunities, the company can begin initiatives aims at establishing itself as a multinational service provider in the tors and travel sector. The company can also embrace different social networking platforms such as You Tube and Instagram as online marketing platforms. This will improve on its popularity within the sector. Threats emanate from the company’s main competitors in the highly competitive tours and travel industry. The Pan Australian Travel for instance, has already embraced online marketing through social networking sites. The company has also been able to extend its services to international markets. Other major tours and travel companies such as WHL continue to dominate the Australian and the international market hence limiting the ability of the company to experience exponential growth. Budget and cash flow Budget Initial capital Note Period for depreciation 17 For the purposes of fixed and long term assets 18 Decoration 2,000,000 5 Motor vehicle 0 3 Equipment 0 5 Office equipment 0 5 Rental and other long term deposits 135,000 Other long term assets 0 2,135,000 Other main expense items Property agency commission 60,000 Consultancy fee 30,000 Promotional expenses 0 Incorporation expenses and business registration fee 7,500 2,232,500 For the purpose of operation (Excl depreciation) 19 Stock（Stock turnover： 30 day(s)） 218,722 20 Recurrent expenditure（ 1 month(s)） 315,000 Initial capital required 2,766,222 21 Payback period 22 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Initial capital required 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 2,766,222 Profit after tax 1,593,719 1,081,453 569,187 56,922 (551,932) (1,223,598) (1,913,518) (2,603,438) (3,293,358) (3,983,278) Depreciation 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000                     1,993,719 1,481,453 969,187 456,922 (151,932) (823,598) (1,513,518) (2,203,438) (2,893,358) (3,583,278) Payback period (year(s)) 1.39 1.87 2.85 6.05 -18.21 -3.36 -1.83 -1.26 -0.96 -0.77 Cash flow statement Market positioning Affordable pricing and distribution are the best market positioning strategies that the company can use in improving the perception of its target customers on the quality of the products and services that it offers (Weaver & Lawton 44). Through affordable pricing strategy, it will be possible for the company to set its prices according to the prevailing market conditions within Australia. Affordable rice is that which seeks to strike a balance between the highest possible price and the lowest possible price. This will make it relatively difficult for the company to experience any client loss on the basis of price (Weaver & Lawton 46). Distribution channel as a market positioning strategy is essential for the growth of the company since it will help the customers perceive the products and services offered by Spencer Tours as those of the highest quality. The creation of this perception can be through the incorporation of customer feedback as an advertising platform (Weaver & Lawton 47). One customer who experiences the quality of products that the company offers will be an instrumental determinant of the future customers that the company will be able to attract. In addition, through customer feedback, it will be possible for the company to develop strategies that can be used to ensure constant and frequen improvements of the quality of the products (Tribe 120). This will be made possible if Spencer Travel embraces both positive and negative feedbacks from its customers. the use of social networking platforms such conversations with actual and potential customers, the services the company provides and its partners within the industry will also help in boosting the profile of the company as an essential service provider in the Australian tours and travel industry (Osborne et al 6). Possible development and integrated set of actions Customer service is an essential platform within the tours and travel industry. This is because the main objective of any company within this industry is to attract and retain more customers. This means that for the company to experience any form of growth in its operations, it has the responsibility of improving on its customer relations (Siebenaler & Groves 12). This is realizable through the introduction of strategies that will improve on the rate of satisfaction of existing customers. One way by which customer services can be improved is through the development of interactive platforms on which the company’s employees can engage on an instant form of interaction with customers. Social networking sites and an interactive website will allow the employees to interact with the customers while at the same time improving on the online visibility of the company (Siebenaler & Groves 14). Conclusion Spencer Tours is an emerging company in the Australian tours and travel market. The success of the company has been on its ability to provide affordable and high quality services to its customers. There is need to the business to expand on its services in ways that will ensure that it grows and the local and international level. One way by which the company can attract more customers is through embracing online marketing strategies aimed at improving on efficient customer relations. Personal reflections The skills that an individual possesses as a manager in any business initiative are essential in the determination of the direction that an organization will take in terms of organizational strategy and culture. One of the skills that I consider important in management is leadership skills. Leadership skills will determine the organizational structure and the communication channels that an organization will embrace. As an open leader who embraces democratic principles, the company will be able to work in accordance with open channels of communication. This is essential in the development of the organization since employees have the permission of engaging in discussion with the management. The decision on whether to embrace the thoughts of the employees can be considered as a prerogative of the management. Effective communication and interpersonal skills are also an essential set of skills for a manager in an organizations setting. This is because these skills will help in boosting the relationship between the management and different stakeholders within the organization. In tours and travels sector, the manager has the responsibility of understanding the desires of individual employee or customers in relation to those of the organization. Communication skills are also essential in the development of an organizations strategy. These strategies often help organizations in the realization of their mandate. Effective communication and interpersonal skills by the manager will enable the organization to engage in the development of some sense of commitment towards the realization of the goals and objectives of an organization. Through this approach it is also possible for an organization to be involved in a process that will ensure that the inputs of every stakeholder in the organization are sought. The resulting strategy will be one that is informed by the inputs of different stakeholders hence easily implementable. It is also important for a manager in an organizational setting it possess team work skills. This will make it easier to intergrate different members of the organization into the realization of common objectives. A manager is a team leader and this makes it important for the leader to understand the essence of team work in the execution of different responsibilities. The team leader is also a team player and this will require the manager to be involved in different communal initiatives and plans on how to realize different goals. It also involves the identification of different skills and talents that individual members of a team possess. These skills and abilities will help the organization in the allocation of responsibilities according to areas of expertise. Such allocations are essential in the promotion of the possibility that a business will realize its objectives from an organizational perspective. It is also possible to assert that through teamwork, an organization also has the ability to execute its responsibilities in accordance with the desires of its employees. The manager becomes less dictatorial and more sociable. In terms of attitude, the perception that a manager develops about an organization or its employees plays a major role in determining the possibility that the organization will succeed in the realization of its objectives. Cognitive attitudes that are largely stereotypical or racial will contribute to the downfall or poor performance of an organization. This is based on the understanding that the manager will be operating according to unverified beliefs about particular group of its employees. Cognitive components of attitudes can also contribute to the growth of an organization especially if they are geared towards positivity. This will motivate employees towards the realization of their objectives and those of the company within the set time periods. Affective components of attitudes deal with feelings and emotions of the manager towards the employees or of the employees towards the management. For an organization to experience any form of growth, it will be important for any affective feeling towards different stakeholders to be founded on the respect. This will ensure that all the employees to operate in accordance with the demands of the principles of integrity and discipline. Discipline for instance enables members of organizations to act in accordance with the demands of the governing principles of an organization. The management will not be able to exercise abusive or exploitative power. Furthermore, through integrity, it will be possible for the management and the employees to act in accordance with the tenets of professional codes of ethics. These codes will be used as the basis of professionalism hence minimizing the possibility of bias within the organization. it is the responsibility of every manager to not only in ways that are acceptable to their job descriptions but also provide a system of leadership that allows different members of an organization to exercise their rights while abiding by the existing laws and regulations of the company. Knowledge on management is an essential for effective governance of a company. Through such knowledge it is possible for tha manger to ensure that he is best played to exercise his responsibilities in accordance with the requirements of different theoretical perspectives involved in managements. There are different concepts that are definitive of the management process. These are only applicable in situations where the manager of an organization understands his responsibility in embracing a philosophical approach or theoretical understanding that will act as the foundation of the organization. Organizational behavior and culture is derived from the philosophical foundation and the overall understanding of employee responsibility from the perspective of the management. This means that for effective organizational behavior to be exercised, it is the responsibility of the manager to provide a channel of operation. In terms of personal traits, I am an individual who embraces courage, enthusiasm and risk taking. I consider these to be essential attributes because they are in line with my career ambitions of managing an SME in the tours and travel industry. My major areas of interest in this industry are derived from the understanding that it is one of the fastest growing industries in the Australian society. In addition, there are players at different levels whose target customers are also varied. I consider effective management as an essential aspect in the growth and development of the business because it will be possible to develop sound strategies that are in line with the demands of theories and travel market. My traits will be essential in this market because of the belied f that tours and travel industry is largely unpredictable. The unpredictability of this industry requires risk taking and courage to undertake a vision with the aim that wit will develop as envisioned by the business. One way by which I have been able to demonstrate my entrepreneurship skill is through active engagement in different entrepreneurship forums with the aim of improving on my skills, knower and experiences on matters related to effective management. I have also been involved in an entrepreneurship aptitude test. This test was aimed at assessing my capacity as an effective entrepreneur. In addition, through this test I was also able to identify my areas of weakness and the mechanisms that I can incorporate to ensure that I improve in my skills. In my previous test I scored 75%. This was above average. Some of the areas that were identified for improvement include my level of creativity and innovativeness in matter of entrepreneurship. To improve on these areas I am currently engaged in numerous online discussion forums on entrepreneurship. This is aimed at providing me with a broad outlook of the contemporary market. References Lawton, Laura & Bruce, David . 2010, “Travel Agency Threats and Opportunities: The Perspective of Successful Owners.” International Journal of Hospitality & Tourism Administration, 10:1, 68-92, DOI: 10.1080/15256480802557283 Osborne, S., Nagendra, P., & Falcone, T. “The changing nature of the travel agency industry: Technological and agency theory issues. 2011: Paper presented at the USASBE/SBIDA Annual National Conference, February 7–10, in Orlando, Florida. Siebenaler, T., & Groves, D. “Travel agents and their survival.” Human Resources in Hospitality & Tourism, 1(1), 2011, 1–16. doi:10.1023/A:1024232915870 South Australian Tourism Commission. South Australian Tourism Indicators. Adelaide: South Australian Tourism Commission. 2002 Tribe, J.. “Strategy for tourism.” In L. Pender., & R. Sharpley (Eds.), The Management of Tourism, 2013. (pp. 119–134). London: Sage. Weaver, D., & Lawton, L. “Not just surviving but thriving: Perceived strengths of successful US-based travel agencies.” International Journal of Tourism Research, 2011. 10(3), 41–53. Read More