tour operators and travel agents

The Difference Between Tour Operators & Travel Agents

28 Sep 2023 Quite a common question for anyone not working in the travel industry is about the difference between a tour operator and a travel agent. Both terms are, in effect, industry jargon and we expect the consumer to work out what the difference is. So let's clear that up. What Is a Tour Operator?   A tour operator is a person or company that thinks up ideas for holidays, researches the ideas, designs the holiday itinerary and content, contracts the services needed for the holiday, accommodation, transport, guides, tour leaders or resort reps and then markets the resultant package. They sell the package either directly to the consumer or use the services of a travel agent to do so. A tour operator sells the product that they themselves create. They do not sell anybody else's packages, they sell only their own creations. A tour operator is what in law is referred to as a "principal", meaning they take responsibility for the package that they create and cover that liability with (usually) an ATOL licence and / or some form of bonding to ensure that the consumer gets their money back if the tour operator fails, or is flown home if they are abroad when a tour operator fails.   It's worth mentioning that, with regard to bonding for financial protection, the law asks that certain items or services must be bonded; AITO demands that all its tour operators bond anything they sell to the consumer; this is in excess of what the law demands, to the benefit of the consumer. Who does a Travel Agent Differ?    On the other hand, a travel agent offers the consumer a range of holiday packages that have been put together by a tour operator. They do not, in theory, put together any of their own packages; they sell lots of different holidays put together by lots of different tour operators. They do not usually design or create the holidays they sell, and they do not act as a Principal. The tour operator whose product they sell takes the responsibility for the holiday; the travel agent does not. Therefore the agent usually does not have an ATOL licence or any bonding in place, but relies on the tour operator to cover this.   Nowadays it is fair to say, the difference between tour operator and travel agent is blurred. Some travel agents do create some packages, and therefore do act as a Principal and have the required licences, but they will also sell other product put together by tour operators.   A good analogy goes like this: if you want to buy a dining room table and chairs, you have two choices. You can go directly to the factory where one particular company makes the table and chairs and buy from the creator of the product. But you will only, at that factory, see furniture made by that one manufacturer. If you go to a high street store and browse their furniture department, you can choose from a range of furniture made by several different furniture makers, but none of the furniture has been made by the high street retail store.   In travel, the manufacturer, the factory, is the tour operator. The high street retail store is the travel agent. It's up to you whether you prefer to (a) talk to the creator or the product, or (b) have a wide range of product from different manufacturers to choose from.  Why Book With a Tour Operator or Travel Agent?   Another common question is why a potential traveller should book their holiday arrangements with a tour operator rather than doing it themselves. The answer to this question covers tour operators and travel agents - both are offering commercially assembled holidays.   It is possible to spend hours researching a possible destination, pondering over the best itinerary, checking for the best hotels and so on. Or you can book with a tour operator who has done all that research and chosen wisely based on their experience and knowledge. If you design your own itinerary it can be fun, but if something goes wrong then you are on your own. A tour operator has a legal responsibility to look after you if things go awry. Strikes, natural disasters, personal illness and several other disasters can befall the traveller, better to have someone to take care of things at such critical times. If your overseas hotel ceases trading when you are there, or on your way there, you are on your own; whereas a tour operator will make alternative arrangements. When the Tsunami struck in Thailand some years ago, all the clients who had booked with a tour operator were helped by their tour operator; they were moved to alternative accommodation or flown home. Travellers who had booked their own arrangements were left to fend for themselves. "It's always the individual travellers who we can't locate and help", said someone at the Foreign Office Travel Unit, "since they don't tell us where they are going".   If you want to assemble that dining room table and chairs yourself it's perfectly possible to buy some wood or other, practice a bit with a saw and then start creating your furniture masterpiece (have some bandages and some glue handy just in case). Or you can go to a furniture factory or retail shop and buy a carefully crafted piece of furniture. Most people do the latter when it comes to furniture - why be any less careful when it comes to making travel arrangements? Make it yourself or buy from a professional - it's your choice. What is the Role of AITO?    A third question is why look at AITO for holiday ideas and help? Imagine if you could get over 100 tour operators all in one place, each with their own special holidays. Imagine if each operator had specialist knowledge about one particular destination or style of holiday. And imagine if each of the tour operators was independently owned. That is, each was run by the people who own it and who are passionate about what they sell. If you actually want all that, visit aito.com and it's all here in one place. 

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Quite a common question for anyone not working in the travel industry is about the difference between a tour operator and a travel agent. Both terms are, in effect, industry jargon and we expect the consumer to work out what the difference is. So let's clear that up.

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Understanding the Difference Between Tour Operators and Travel Agents

By Cressida Sergeant

Tour operators and travel agents might seem similar at first glance, but they have distinct roles when it comes to planning a vacation. While they both offer some similar services, it’s helpful to know which one best fits certain needs.

What is a Tour Operator?

A tour operator handles the nitty-gritty of a holiday experience, from booking and packaging to organising accommodation, transport, meals, guides, and optional tours. They’re like the behind-the-scenes magicians who ensure everything runs smoothly once a customer steps off the plane at a destination

On the other hand, travel agents act as matchmakers, connecting customers with the perfect vacation package from various tour operators. They’re like personal travel advisors, helping navigate through different destinations, budgets, and travel preferences to find the ideal fit for a dream getaway. Once customers have made a choice, they liaise with the tour operator to ensure all requests are met, handling the paperwork and payments along the way.

In the past, travel agents were the go-to choice for booking tour packages. However, with the rise of the internet and travel technology over the last couple of decades, many people now opt to book directly with tour operators. The internet has made it easier than ever to access and book tour packages independently, reducing the need for an agent to identify available operators. Nowadays, most tour operators engage directly with clients and sell their packages, cutting out the middleman.

However, some people still prefer to rely on their trusted local or family travel agent, with whom they have built a long-standing relationship over the years.

Types of Travel Agency

In the travel industry, there’s a growing number of independent travel agents who operate without ties to a specific agency. This presents a fantastic opportunity for people looking for remote work in the travel sector.

These independent agents come in various forms. Some create bespoke itineraries tailored to each client’s preferences, while others partner with specific travel companies. Additionally, some act as resellers, offering pre-packaged tours through Host Agencies.

Regardless of their specific model, most travel agents excel at helping to plan a trip. They use their expertise to provide recommendations based on their customer’s interests, budgets, and travel requirements. The advantage of working with a travel agent lies in their insider knowledge and knack for navigating the complexities of holiday planning and booking. When it comes to travel agencies, there’s a varied range of options available to suit every preference. Here are some of the different types of travel agencies:

Online Travel Agencies (OTAs): These are websites that allow users to search and book travel-related services online. OTAs offer a wide range of options, from flights and cruises to tours and activities, all in one convenient platform.

Brick-and-Mortar Travel Agencies: These are traditional travel agencies with physical offices where customers can visit and speak with travel agents face-to-face. They provide personalized service and assistance in planning and booking travel arrangements.

Corporate Travel Agencies: Specializing in business travel, corporate travel agencies cater to the needs of companies and organizations. They manage corporate travel policies, negotiate discounts with suppliers, and help with itinerary planning and expense management.

Specialist Travel Agencies: These agencies focus on specific types of travel, such as adventure travel, luxury travel, or niche markets like eco-tourism or culinary tours. They offer expertise and tailored recommendations for travellers with particular interests or preferences.

Overall, the travel agency landscape is diverse and caters to a wide range of travellers, each with unique needs and preferences.

The Roles of Tour Operators and Travel Agents

In conclusion, while tour operators and travel agents share some similarities, they play distinct roles in the holiday planning process. Tour operators handle the logistics of a vacation, from booking and packaging to on-the-ground arrangements, ensuring a hassle free experience for travellers. On the other hand, travel agents act as intermediaries, connecting customers with the perfect holiday package from various tour operators, and offering personalized advice and assistance throughout the planning process. Despite the rise of online booking platforms and websites , many travellers still rely on trusted travel agents for their expertise and insider knowledge. Additionally, the travel agency landscape continues to evolve, with independent agents offering bespoke services and various types of agencies catering to different travel needs and preferences. Ultimately, whether booking through a tour operator or a travel agent, travellers have access to a diverse range of options to suit their individual preferences and requirements thanks to the advancements in travel technology and products .

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Core Differences

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10 Difference between Tour Operator and Travel Agent (With Table)

Technological advancement has made traveling around the world easier. But a lot of people have lost thousands of dollars when trying to book holiday packages online.

Travel industries have tried to get rid of these misconceptions by introducing tour operators and travel agents. The purpose is to protect travelers from scammers in the online travel industry.

Many people usually find tour operator and travel agent terms quite confusing. This industry jargon may sound the same but that is not true in real life.

So, what is the main difference between tour operator and travel agent? The former is the company or an individual responsible for planning the trip while the latter is the broker or intermediary selling the tour package.

The relationship between the travel agent and tour operator can be confusing for first-time travelers. Understanding the definition of travel agent and tour operator is crucial in this case.

This article provides insight into the differences between tour operators and travel agencies in a tabular form. Take the time also to read the similarities between tour operators and travel agents.

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Comparison Table (Tour Operator vs Travel Agent)

Who is a tour operator.

A tour operator is a person or company responsible for planning, arranging, advertising, and creating trips or tours packages for clients.

Tour operators are responsible for creating holiday packages such as accommodation, airport pick-ups, activities, and trips.

The trips usually take place through an intermediary or directly. These two channels are ways how the tour operators make sales in the travel industry.

Inbound tour operators are those companies that receive guests and handle all arrangements within the host country (responsible for community-based tourism experience).

Outbound tour operators promote foreign destinations while domestic tour operators offer travel services to domestic travelers (service may not be taking place entirely in the country).

Ground tour operators are locally based and usually work in close association with other travel businesses. The operators do not sell transportation and guidance services individually.

Who Is a Travel Agent?

A travel agent is a person who sells and administrates holiday packages to tourists. These individuals help tourists narrow down their searches and recommend the best travel packages.

Travel agency works with several tour operators and earns a commission after the tourist has made a booking with the desired tour operator.

Travel agents offer tourists different experiences depending on their needs. Travel agencies are responsible for promoting tourism in a particular country or destination.

The travel agency is responsible for processing and packaging all the attraction, amenities, and ancillary services.

Travel agents work directly with tour operators and they provide transportation, accommodations, and trip packages.

Main Difference between Tour Operator and Travel Agent

• Tour operators create holiday packages, sell, advertise and plan. Travel agents sell and administrate tour packages.
• Tour operators deal with finer details such as accommodation, tickets, and meals. Travel agents help tourists to choose a suitable package.
• Tour operators offer advice on legalities on the ground while travel agents offer advice on travel documents such as passports or visas
• Tour operators’ job ends when the client returns home after vacation while travel agents job end when the client makes a booking for vacation.
• Tour operators earn huge profits since they set trip fees while travel agents earn commission from the bookings made by the client.

Similarities between Tour Operator and Travel Agent

• Both belong in the travel industry
• Both help tourists fulfill their holiday experiences
• Both have information about various destinations.
• Both promote tourism in various destinations.

Frequently Asked Questions

Is a Tour Operator an Agent?

Not really. An agent sells the holiday packages bought from a tour operator. The tour operator takes care of the tourist according to the holiday package description.

Difference between Travel Agency and Tour Operators

Travel agencies sell attractive tour packages to people interested in holiday vacations. Tour operators are responsible for creating holiday packages and broke them to travel agencies.

Difference between Wholesale Travel Agency and Tour Operator

A wholesale travel agency deals with one component of travel product whereas a tour operator deals with a variety of tour programs. Besides that, a wholesale travel agency does not sell directly to the public and a tour operator does sell directly to the client.

In Conclusion

The core difference between a tour operator and a travel agent is that a tour operator creates the holiday packages while a travel agent is responsible for selling and administering the holiday packages to clients interested in the vacation.

Do not allow the close relationship between travel agents and tour operators to confuse you. I hope this article was helpful in telling the difference between travel agency and tour operator.

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More Sources and References

• https://tourismnotes.com/tour-operators/
• https://link.springer.com/referenceworkentry/10.1007%2F978-3-319-01669-6_206-1
• https://www.researchgate.net/publication/315768436_THE_TOURISM_INTERMEDIATION_SYSTEM_THE_RELATIONSHIP_BETWEEN_TRAVEL_AGENCIES_AND_TOUR_OPERATORS

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Travel agencies and tour operators both are necessary for the travel industry. But sometimes the question arises re their actual definition.

How are they different?

If you’re often confused by the difference between a travel agency and a tour operator, we’re going to discuss these two roles, and outline the significant differences between them.

They’re often connected, but are not the same.

The Difference Between a Travel Agency and a Tour Operator

Travel agency.

A travel agency is a company who plans, arranges, books, and makes the necessary arrangements for travellers. They sell flights, accommodation and tours, and package them together for travels who don’t wish to book themselves.

Worth noting that there are now many independent travel agents, who take on this role without being connected to an agency, and this can be  a great travel industry job  for people who want to work remotely.

There are several types of travel agents. Some put together itineraries from scratch for their clients while others work for specific travel companies, and some are mere resellers of pre-packaged tours on behalf of Host Agencies.

However most will help you plan your trip, and make suggestions based on your interests, your budget , and your travel requirements, the benefit here being that they’re experts in booking travel, and know the best tricks for planning and booking a holiday.

Pro tip:  An MLM scheme can usually be identified when there is a set-up cost involved in working for the company as an agent.  You shouldn’t have to pay to work for someone.

Travel agents are professionals – in many countries agencies need a travel agency license , meaning they are qualified and licensed to book trips on behalf of other people.

The way they make money is through access to industry discounts from companies they work with, which allows them to add a markup / commission to make money without charging more to the traveler.

Tour Operators

A tour operator is someone who organizes, prepares and runs a holiday tour. If you book a tour which includes accommodation, transport, breakfast, tour guides, and sightseeing etc, this is organized by the operator.

Essentially, they sell a product that they themselves create. They work with suppliers to create a packaged tour which they put their own price tag on, and can be booked by travel agents for their clients, or by the traveler directly.

They do not sell anybody else’s packages (which travel agents do), they only organize and sell their own tours.

Just as there are many different types of agents, there also are many different types of tour operators , including  inbound tour operators, outbound tour operators, domestic tour operators, and ground tour operators.

Though even inbound and outbound tour operators, who bring tourists to a country and handle all the arrangements in that country, will hire local travel agents to book in things like airport transfers, and maybe even hire ground tour operators for the tour itself.

With advances in technology, many travelers now book their packages directly with the tour operators rather than going to a travel agent, where-as in the past travel agencies were often the only option for connecting with a tour.

Key Differences Between Travel Agencies and Tour Operators

➤ Travel agents sell the holiday package purchased from different tour operators. Tour operators take care of the clients according to the package description like airport pick up, meal facilities, sightseeing, offering other travel destinations, etc.

➤ Tour operators are often specialized in one, or very few countries. But travel agents can deal with most destinations.

➤ A travel agent earns less profit, usually a small mark up or commission based on the travel they’re booking. Tour operators have the potential to earn a huge profit, as they set their own price tag.

➤ Travel agents can’t work without the help of tour operators. But tour operators can work without a travel agency being that people are now more likely to contact tour operators directly for a holiday package.

➤ There are different kinds of training programs available to start a travel agency. In comparison, the tour operator requires proper business management skills.

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Megan is an Australian Journalist and award-winning travel writer who has been blogging since 2007. Her husband Mike is the American naturalist and wildlife photographer behind  Waking Up Wild ; an online magazine dedicated to opening your eyes to the wonders of the wild & natural world.

Having visited 100+ countries across all seven continents, Megan’s travels focus on cultural immersion, authentic discovery and incredible journeys. She has a strong passion for ecotourism, and aims to promote responsible travel experiences.

Great information on Travel Agency and Tour Agent.

Glad the post was helpful for you Bella, thanks for reading :)

Thanks so much.it was helpful

You’re welcome! Thanks for reading :)

Thank you Megan,

We are a small family tour operator here in Tasmania. Specializing in small private experiences, with great guest focus, attention to interests and needs. Delivering balance of Tassie wild, depth in past and present with a side order of creative local produce.

We small and passioante operators need to support each other.

Great to connect with you Ben! Weve recently moved from Tasmania to Cairns, but Tassie will always be home :)

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How do Tour Operators Work?

To unlock the tourism industry's business and leisure travel potential, you must understand how tour operators work.

From package holidays to bespoke tours, tour operators make memorable holidays. Whether you're a domestic operator focusing on your country's destinations or an outbound operator designing trips abroad, this guide is for you.

The Role of Tour and Activity Providers

At the heart of the travel industry, tour operators like you, whether inbound or outbound, design travel packages that simplify things for tourists. This involves meticulous planning of land arrangements, accommodation, tours, and transport.

As a tour company, you may specialize in specific types of trips, such as leisure travel or business trips, creating packages that cater to your target market's preferences.

What are the different types of tour operators?

• Domestic Tour Operators : Focusing on the domestic tourism market, these operators provide travel packages within their home country.
• Outbound Tour Operators : These companies design holiday packages for travelers visiting other countries, often incorporating international destinations into their itineraries.
• Inbound Tour Operators : Inbound operators cater to tourists coming into their host country, providing local insights and experiences.
• Ground Tour Operators : Often known as ground operators, these firms handle local arrangements in the destination country, often working in collaboration with other tour operators.

How do tour operators work with accommodation and transport providers?

Tour operators play a pivotal role in crafting the perfect travel experience, and a big part of this involves working closely with accommodation and transport providers. Here's a glimpse at how this collaboration typically works:

Building Relationships with Accommodation Providers

• Negotiating Rates : Tour operators negotiate contracts with hotels and resorts to secure competitive rates. This often involves bulk booking or agreeing on fixed rates for a certain period.
• Customizing Guest Experiences : They work with these providers to tailor lodging experiences that align with the overall theme of the tour, whether it's luxury, adventure, or cultural immersion.
• Ensuring Quality and Standards : Regular inspections and feedback mechanisms are put in place to ensure that the accommodation meets the expectations and standards required for their clients.

Partnering with Transport Providers

• Seamless Logistics : Tour operators coordinate with various transport providers, including airlines, bus companies, and car rental services, to manage the logistics of getting travelers from one point to another.
• Group Deals and Scheduling : They often negotiate deals for group travel and ensure that transportation schedules align seamlessly with the overall tour itinerary.
• Quality and Safety Checks : Ensuring travelers' comfort and safety is paramount, so tour operators regularly check the quality of vehicles and the reliability of transport services.

Creating Cohesive Travel Packages

By integrating accommodation and transport seamlessly, tour operators create cohesive and hassle-free travel packages. This integration is crucial in providing a smooth and enjoyable experience for travelers, where every aspect of their journey is well-coordinated and managed.

Adapting to Client Needs

Tour operators remain flexible and responsive to their clients' needs, often customizing aspects of accommodation and transport to cater to specific preferences or requirements.

To summarize, negotiating strategically, ensuring quality, and meticulous planning are crucial to the relationship between tour operators, accommodation providers, and transport providers. In order to deliver great travel experiences that aren't just fun, they must be safe, comfortable, and just right to match discerning travelers' expectations.  

How do tour operators work with travel agents and OTAs?

Tour operators team up with travel agents and OTAs? It's like having the best of both worlds in the travel industry.

Here's the lowdown: travel agents are like sales gurus. They've got the skills to match your cool tour packages with travelers looking for their next adventure. It's all about personal touches and making travelers feel special.

Now, let's talk about OTAs – think big names like Expedia and Booking.com . These guys are your ticket to the global stage. They're not just about showing off your tours; they're about connecting you with travelers from all over, 24/7. Plus, with their smart marketing tools and the power of customer reviews (which, let's face it, are gold in our world), you're setting yourself up for some serious visibility and street cred.

Combining travel agents' personal selling charm with OTAs' global reach is how tour packages stand out in this competitive market.  

Talking about creating packages, how can you work with accommodation and transportation providers?

How to create inclusive tour packages?

As a tour provider, crafting appealing and inclusive tour packages, also known as package holidays or package tours, is key to attracting travelers.

These packages bundle services like flights, accommodations, and transportation for a hassle-free experience. Here’s how you can create comprehensive offers:

• Understand Your Travelers : Know who you’re designing for. Are they families, solo travelers, or adventure seekers? Tailoring your packages to fit their preferences is crucial.
• Forge Strong Relationships with Suppliers : Collaborate closely with accommodation and transportation providers. Strong partnerships can lead to better rates and unique offerings, making your packages more attractive.
• Quality Over Quantity : When choosing hotels and transportation options, prioritize quality. A well-selected hotel or comfortable transport experience can elevate your entire package.
• Flexibility is Key : Offer flexibility in your packages. Options for room upgrades, transport preferences, or even alternative activities can make your package more appealing to a diverse range of travelers.
• Highlight Unique Experiences : Include special experiences travelers can’t find elsewhere. Unique local tours or exclusive access to attractions can make your package stand out.
• Transparent Pricing : Ensure transparency in pricing. Hidden costs discourage travelers. Clear, upfront pricing builds trust and satisfaction.
• Feedback Loop : Regularly gather feedback from your customers and adjust your packages accordingly. Continuous improvement based on customer insights can significantly enhance your offerings.

By focusing on these areas, you can create inclusive tour packages that meet but exceed the expectations of your travelers, ensuring memorable and hassle-free trips.

How do tour operators pay suppliers?

For tour operators, establishing and maintaining a solid financial relationship with suppliers — including accommodation and transportation providers — is crucial for a smooth and successful business and tour operation itself. Here's a look at how these payments are typically managed:

Advance Payments and Deposits

Tour operators often make advance payments or deposits to secure services well ahead of tour dates. This is especially common with hotels and special activities that require early booking.

Credit Facilities and Post-Payment Agreements

In some cases, tour operators may have credit arrangements with suppliers, allowing them to pay after the service is delivered. This requires a high level of trust and a proven track record of reliable payments.

Bulk Payment Contracts

For regular or frequent services, operators might negotiate bulk payment contracts. Under these agreements, they pay a lump sum for a specified number of services or bookings over a period, often at a discounted rate.

Net Rate Agreements

Suppliers may offer net rates to tour operators, which are discounted prices exclusive of commissions. The domestic tour operators then mark up these rates when selling to customers, and the difference forms their profit margin.

Direct Billing for Services

In some collaborations, suppliers might directly bill the tour operator for services rendered, usually after completion.

Electronic Payments and Wire Transfers

With the digitalization of financial transactions, most payments are now made electronically. This ensures quick, secure, and traceable transactions.

Managing Currencies and Exchange Rates

For international tours, operators must adeptly manage payments in different currencies, considering exchange rates and transaction fees.

Contingency Funds for Unforeseen Expenses

Operators often set aside contingency funds to cover unexpected costs or last-minute bookings, ensuring that the tour runs smoothly without financial hiccups.

Why is the booking process so important for selling tours?

The booking process is crucial in the tour industry for several key reasons:

• First Impression Matters : This initial interaction sets the tone for customer experience and expectations.
• Ease Equals Sales : A simple, user-friendly booking system encourages more purchases.
• Trust Building : A smooth process builds trust, showing customers that they’re dealing with a professional operator.
• Upselling Opportunities : During the booking, there’s a chance to offer additional services or upgrades, enhancing the experience and increasing revenue.
• Data for Personalization : The information collected can be used to tailor future offerings and improve service.
• Effective Communication : This stage is vital for conveying key tour information and ensuring customer understanding.
• Reputation Impact : A positive experience can lead to recommendations and positive reviews, while a negative one can harm the operator's reputation.
• Resource Management : Understanding booking trends helps manage tours and resources.

In short, the booking process isn't just about securing sales; it's about shaping the entire customer journey, from first impressions to post-tour feedback.

Tips for Operators

Invest in a good, easy-to-use, and cost-effective booking software solution. Granted, it may incur some fees on your part, but think of the heavy lifting it does for you.

It does more than take reservations and bookings. It saves you tons of time with manual tracking, guest follow-up, and ticket management. It also eases the customer journey from point one to post-tour feedback.

Booking software solutions like TicketingHub save you stress and ease your guests. It charges 3% only for successful bookings.

Trusted by Egypt Sound and Light Shows, The Immersive Gamebox, Secret Food Tours, Sipsmith Distillery , and a hundred folds more - this software solution is jam-packed with time-saving features in an easy-interfaced navigation.

Whatever software solution you pick, aim for the solution that saves you time from needless complexities in design and usability - all while helping you stay profitable and leaving your guests satisfied right from the booking page.

Conclusion: Making Great Tours Happen

In wrapping up, it's clear that being a tour operator is about connecting the dots to create amazing travel experiences. Whether you're showing off the best spots in your own country or taking people on adventures abroad, the key is in the details – from picking great hotels to organizing smooth rides.

Your partnerships with local travel agencies, agents and OTAs are super important too. They help you reach more people and make sure your tours stand out. And when making tour packages, remember to listen to what travelers want and keep things flexible and interesting.

Don't forget, managing your money well, especially when paying for services, keeps everything running smoothly. And the booking process? That's your chance to make a great first impression and keep things hassle-free for your customers.

So, there you have it – mix in a bit of planning, a dash of good relationships, and a sprinkle of creativity, and you're on your way to creating trips that travelers will love. Happy touring!

FAQ Section

How important are tour operators.

Tour operators play a pivotal role in the tourism industry. They create and organize tour packages, catering to both business and leisure travelers. These packages simplify travel arrangements, offering hassle-free travel.

Tour operators are the key architects of memorable trips, ensuring travelers can explore various destinations easily.

What is the life of a tour operator?

Tour operators plan meticulously and collaborate with various stakeholders. They work closely with outbound and inbound tour operators, accommodation and transport providers, and even travel agents and online travel agencies (OTAs).

Their goal is to create appealing package holidays, manage travel arrangements, and provide tourism products that meet their target market's preferences.

What are the strengths of tour operators?

Tour operators have several strengths, including the ability to create inclusive tour packages that simplify travel for tourists. They can specialize in various categories, such as business or leisure travel. They can also collaborate with distribution partners like travel agents and OTAs to reach a wider audience.

Tour operators leverage market data to sell directly to their target market, offering tourism products that cater to different preferences.

What's the difference between a tour operator and a travel agent?

Tour operators and travel agents serve different roles in the travel industry. Tour operators design and create tour packages, manage travel logistics, and provide tourism products.

Travel agents, on the other hand, act as intermediaries between travelers and tour operators or suppliers. They assist customers in choosing and booking the right travel options, including tours created by tour operators, but they don't create the tours themselves.

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What is a tour operator and how does it work?

Disclaimer: Some posts on Tourism Teacher may contain affiliate links. If you appreciate this content, you can show your support by making a purchase through these links or by buying me a coffee . Thank you for your support!

The tour operator is an integral component of tourism , yet many people are unclear about what a tour operator actually is or what they do.

In this article I will explain what a tour operator is and why tour operators are important. I will also talk about what the difference between a tour operator and a travel agent is, as well as the different types of tour operators.

What is a tour operator?

Definitions of tour operator, importance of tour operators, the difference between a tour operator and a travel agent, what does a tour operator do, products and services sold by tour operators, inbound tour operators, outbound tour operators, domestic tour operators, ground tour operators, the association of independent tour operators, the tour operator: to conclude.

Tour operators are inextricably linked to the package holiday model. The tour operator is the person or organisation who creates the package. A travel agency is then used to sell the package holiday.

In the chain of distribution , the tour operator is represented by the term ‘wholesaler’. This is because the tour operator is responsible for purchasing products of services in bulk and then redistributing them as a packaged product to consumers.

To put it simply, a tour operator is the person or organisation who takes the individual elements of a holiday (e.g. transfer, hotel, transport) and packages these together.

The types of package vary. Most commonly, tour operators are associated with mass tourism and the traditional package holiday market. However, tour operators do also play an important role in the production of niche tourism products and services too.

If you’re looking for a formal definition of a tour operator with a reputable source, you may want to reference Polyther, who in 1993, defined the tour operator as;

‘[an organisation or person] who has the responsibility of putting the tour ingredients together, marketing it, making reservations and handling actual operation’.

Similarly, Holloway (1992) states that;

tour operations undertake a distinct function in the tourism industry, they purchase separate e lements of tourism products/services and combine them into a package tour which they sell directly or indirectly to the tourists .

The Organisation for Economic and Cultural Development (OECD) define a tour operator as follows;

‘Tour operators are businesses that combine two or more travel services (e.g., transport, accommodation, meals, entertainment, sightseeing) and sell them through travel agencies or directly to final consumers as a single product (called a package tour) for a global price. The components of a package tour might be pre-established or can result from an “a la carte” procedure, in which the visitor decides the combination of services he/she wishes to acquire.’

Tour operators are an important part of the tourism industry .

Tour operators make the logistics of organising a holiday much easier for the consumer. This makes people more likely to travel, more often.

Tour operators have a lot of power. If they choose to sell holidays in a particular location, for example, then that location will receive many of the associated positive and negative economic impacts of tourism .

Tour operators are often vertically or horizontally integrated with other organisations, such as travel agents and airlines. This allows for easier management and distribution of products.

Tour operators typically build holidays en masse. This means that economies of scale play a key role in driving down prices- the more you produce the cheaper the product becomes! This is obviously beneficial to the consumer and helps travel agents to have a competitive advantage when selling holidays.

Many people are not aware that a travel agent and a tour operator are actually two totally different organisations and they are not aware of the difference between a tour operator and a travel agent.

In fact, it is quite easy to understand this difference!

A tour operator is the organisation which puts the different elements of a holiday together. And the travel agent is the organisation who sells it to the consumer.

Whilst this differentiation is pretty easy to comprehend, it is easy to understand why people get tour operators and travel agents confused. This is largely because many organisations will operate under the same company. For example, TUI has a tour operator and a travel agent (and an airline too). As a result, many people do not realise that in actual fact, there are two separate organisations doing two separate jobs.

Ultimately, a tour operator is responsible for putting the different elements of a holiday together into a commodified package.

To do this, there are a number of different roles and responsibilities that tour operator staff will have. This includes:

• Data analysis- which destinations will sell best, how many holidays should they sell etc
• Assessing suitability of accommodation, transfer and transport options
• Liaising with stakeholders e.g. coach operators, airlines, hoteliers and resort representatives
• Negotiating contracts
• Confirming reservations with airlines/hotels
• Managing and responding to customer feedback
• Undertaking market research
• Production of marketing material
• Providing pricing information
• Handling bookings, invoicing and issuing of tickets
• Working with travel consultants from different travel agencies to put holiday packages together

Tour operators have a number of products and services that they sell, depending on their specific business model, business intentions and target market. A tour operator will typically package together two of more elements to form a packaged product, which is then sold at an inclusive price.

Examples include:

• Package holidays
• Accommodation
• Information on destinations
• Representative service in resorts

Types of tour operator

Tour operators come in all shapes and sizes. Some are large, multinational organisations and other are small, independent business.

Different types of tour operators develop products for different types of tourism . This can include the mass market, niche tourism market, special interest tourism, the luxury market, tailor-made products and dynamic packages .

There are four different types of tour operators, which I will explain below.

• Inbound Tour Operators
• Outbound Tour Operators
• Domestic Tour Operators
• Ground Operators

An inbound tour operator is one who facilitates inbound tourism .

The aim of an inbound tour operator is to bring tourists in to a particular country or countries.

Inbound tour operators will often collaborate with local travel agencies and transport operators to facilitate travel arrangements for their customers.

Inbound tour operator example: A group of German tourists conduct a tour of China, encompassing a visit to Shanghai , Hangzhou and the Yellow Mountains . The tour operator who organises their travel is Chinese-based company China Highlights . This company is based locally in China and they offer local, Chinese tours.

An outbound tour operator is one who facilitates outbound tourism .

The aim of an outbound tour operator is to send tourists out of a particular country or countries.

Outbound tour operators will often collaborate with foreign travel agencies and transport operators to facilitate travel arrangements for their customers.

Outbound tour operator example : A family of four from Liverpool, UK want to book an all-inclusive summer sun holiday in Alicante. They book through TUI , the largest tour operator in Britain, who specialises in outbound travel. They are based in the UK, but they work with foreign partners to facilitate holidays overseas.

A domestic tour operator is one who facilitates domestic tourism .

The aim of a domestic tour operator is to organise travel within a particular country or countries.

Domestic tour operators will often collaborate with domestic travel agencies and transport operators to facilitate travel arrangements for their customers. Domestic tour operators will often also serve the inbound tourism market.

Domestic tour operator example : A group of twenty-something boys from Chicago want to travel to Florida for the spring break holiday. They want to do a tour of the local attractions in the area and have some time to relax on the beach . They organise their travel through the tour company, Trek America . Staff at this company are experts in domestic travel within the USA.

A ground tour operator is an organisation who dopes the ground work as grass roots level.

Many tour operators do not have connections in all places around the world, therefore they build a network of connections to help them run their business.

Essentially, some of the work is passed on to a third party, known as a ground operator. This work may include negotiating local contracts, liaising with local suppliers and providing market data, amongst other things.

This is especially common for small tour operators.

You may also hear ground tour operators referred to as handling operators or handling agents.

Ground tour operator example : A backpacker wants to ‘give something back’ and book a volunteer tourism holiday in Kerala. She wanted to use a known and trusted tour operator to book her trip so she booked it with Intrepid Travel . Intrepid Travel create and sell adventure holidays all over the world, and it is impossible for them to have contacts and every staff in every corner of the globe. Therefore they work with local ground operators, who do the work on the ground. In this instance, the ground organisation is Iris Travel – a tour operator based in Kerela, India.

The Association of Independent Tour Operators , abbreviated as AITO, is a travel industry trade group (like  ABTA  or ATOL) based in Britain. They launched in 1976.

The AITO represents around 120 independent  tour operators  across 200 countries.

These tour operators provide access to a huge range of activities including city breaks, safaris, luxury holidays and much more. The AITO is based in Twickenham, south-west London.

The AITO does a variety of things. Most importantly, you can be reassured that your holiday is well-protected thanks to the Association of Independent Tour Operators.

They assess every member financially as well as by their own business practice code before granting membership; this means that you are guaranteed clear and accurate descriptions of holidays as well as tour standards that are consistently monitored.

Tour operators are an important part of the tourism industry, and with AITO, you have added security when booking your travels through a tour operator. Hopefully after reading this article you are now confident with what a tour operator is, how these organisations work and the different types of tour operators operating the market.

If you liked this article, why not take a look at these too?

• Types of travel agents | Understanding tourism
• What is e-tourism and how is it changing travel?
• 10 jobs in travel and tourism that will be BIG in 2022 and beyond
• What does the World Travel and Tourism Council do?

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• World's Best

Travel + Leisure Readers' 15 Favorite Tour Operators of 2023

The right tour operators can make or break a trip. These specialists came out on top in our annual "World’s Best Awards" survey for 2023 thanks to insider knowledge and personalized service.

How Voting Works

What readers loved, the full list.

Courtesy of Butterfield & Robinson

While we travel to see the sights, what we really take home with us are the experiences. And finding the right tour operator — one that’s able to meld insider knowledge about a destination with the best ways to take it in — can make or break a trip. But when the right combination does come along, it can be pure magic, so it’s no wonder that the last year has seen group travel on the rise .

Every year for our World's Best Awards survey, T+L asks readers to weigh in on travel experiences around the globe — to share their opinions on the top hotels, resorts, cities, islands, cruise ships, spas, airlines, and more. Nearly 165,000 T+L readers completed the 2023 survey, an increase of nearly 25 percent over pre-pandemic voting levels. A total of more than 685,000 votes were cast across over 8,500 unique properties (hotels, cities, cruise lines, etc.).

Tour operators and safari outfitters were specifically rated on the criteria below:

• Staff/guides
• Itineraries/destinations
• Accommodations

For each characteristic, respondents could choose a rating of excellent, above average, average, below average, or poor. The final scores are averages of these responses.

With nine of the companies returning from last year’s list , one major trend that stands out is the focus on a region, like with this year’s No. 1 pick, ATJ, which focuses on luxury travel, ranging from bespoke private to small group itineraries, in Austrasia. Also destination experts are Inside Japan Tours (No. 10), who offer themed trips, from honeymoons to diving, around the island nation, and Vagabond Tours of Ireland (No. 12), which makes its debut on the list, standing out for its B Corporation status, as it guides travelers around the Emerald Isle in their choice of style, either relaxed and culture-focused or active and adventurous. 

Also notable are the operators who go a step beyond, like two returning favorites: Artisans of Leisure (returning as No. 3) has been called “top notch”; one reader said that “no other tour operator comes close in terms of knowing the destinations [and] understanding what we want and executing our trip flawlessly.” Black Tomato (dropping from last year’s No. 4 to a still respectable No. 6) manages to both fulfill curiosity and allay FOMO on its adventures globally.

But more than anything, it’s loyalty that shows what a strong tour operator is made of, and readers often raved about return visits with a particular company. One, for instance, shared that after 25 journeys, Du Vine Cycling + Adventure Co. (No. 2) stands out among them all. “The best cycling trips I’ve been on,” they said. “Great staff, accommodations, and first class all the way.” And that’s the winning combo for a tour company — leaving travelers with that passion for exploring the world through their eyes. See the complete list of top 15 tour operators, according to T+L readers, below.

Courtesy of ATJ

Formerly known as Asia Transpacific Journeys, ATJ made the list in 2011, 2017, and 2018, and it now leapfrogs back in triumphantly, notching the No. 1 spot. Offering tours in countries like Australia, Bhutan, Japan, Laos, Mongolia, Morocco, Nepal, Vietnam, and Taiwan, the company specializes in custom itineraries and private group trips. But what travelers rave about is its band of extremely helpful customer service reps who are “responsive and personable.” They added, “I can call and speak with a live person immediately.” Customers tend to be loyal, but so are the agents: “I have used the same agent and she always remembers what we like and any special needs we have.”

I have used the same agent and she always remembers what we like and any special needs we have.

Reader Score: 99.07

2 . DuVine Cycling + Adventure Co.  

Reader Score: 99.05

3 . Artisans of Leisure  

Reader Score: 98.89

4. TCS World Travel

ReaderScore: 98.84

5. Trek Travel 

Reader Score: 98.62

6. Black Tomato  

Reader Score: 98.29

7. Classic Journeys  

WBA Hall of Fame honoree.

Reader Score: 98.27

8. Adventure Unbound  

Reader Score: 98.15

9. Scott Dunn  

10. Inside JapanTours  

Reader Score: 98.13

11. Butterfield & Robinson  

Reader Score: 98.00

12. Vagabond Tours of Ireland

Reader Score: 97.78

13. Quasar Expeditions

Reader Score: 97.53

Reader Score: 97.33

15. Jacada Travel

Reader Score: 96.20

How does the travel industry actually work?

You may be new to the travel industry, investigating a career in travel or just trying to research a bit about the industry ahead of your next adventure. There’s a mass of information out there and it can be overwhelming to wrap your head around. Lucky for you, our team of travel experts have been hard at work to give you a bird’s eye view of the travel industry as a whole .

The travel industry has gone through many evolutions with a variety of external factors contributing to who has access to travel, where they are travelling to and what the travel industry looks like overall.

A few important travel industry statistics

Let’s start by setting the scene…the travel industry is HUGE and the numbers certainly prove it .

Source: Statista

A brief history of the travel industry

We are fortunate to live in a globalised world meaning that travel is reasonably accessible. At the press of a button, most people are able to book a flight and jet off to wherever our wallets will take us. 

But, it hasn’t always been so easy. To help you understand how the industry has developed to the point it has today and where it might head in the future, here is a travel industry timeline.

Before the mid 20th century, travel was reserved for the extremely wealthy. It was expensive and it was time-consuming (can you imagine having to travel on a boat for 3 weeks…. or 3 months!). The concept of a ‘travel industry’ had not yet formed; it was more a collection of hotels, restaurants and coachlines who all operated independently from one another.

1950 – 2000

After the Second World War, travel suddenly started to become accessible for many more people due to the development of commercial airlines. Although they were originally still very expensive,  costs started to reduce over the years and more people were able to invest in seeing the world.

The industry grew and grew, and many saw a gap in the market for people wanting to travel but not having the knowledge, or time to organise it themselves – travel agents and tour operators started to establish themselves!

2000 – 2019

The travel industry has undoubtedly boomed, and the way that people travel is almost unrecognisable from the early 20th century. With smartphones, we now have unlimited apps at our fingertips, specifically designed to make every aspect of travel easier. 

For travellers, there are websites and apps to help them plan their travel, help them while travelling and to give them inspiration for their next trip! For travel agents and tour operators, itinerary software has streamlined much of their processes, from itinerary planning to customer relationship management. Now all this technology is amazing, and helps our lives in many ways, but has also resulted in fragmentation of the travel industry with travellers choosing to plan and manage their trips themselves or online increasingly.

 2020 and the future of travel

Due to the pandemic and the pause in travel, both countries and travellers worldwide re-evaluated travel and how it should be conducted. Countries who experienced over-tourism considered ways to encourage more sustainable travel in their destinations . For travellers, Covid triggered them to start thinking about their bucket list destinations and working with travel designers to plan and book them. This resulted in tourism returning with a significant rise in 2022, although the industry is indicating it might be plateauing in 2023/2024 .

How does the industry actually work?

You may be thinking to yourselves, how does travel actually function as an industry . How does it all fit together? You are not alone, it’s a complex industry notorious for its jargon, terminology and abundance of acronyms!

As you can see there are a few key players to remember:

Tourism Boards and Government organisations: Usually run or overseen by local or national governments. These boards set in place regulations for the other players in the industry. They also market countries or cities as tourist destinations for potential travellers

Suppliers/Vendors: Suppliers (or Vendors) are the hotels, the restaurants and the activity providers that travellers eat, stay and partake in on their travels. Travellers may liaise with and purchase from suppliers directly if they are organising their own travels, or communications with suppliers may be managed entirely by a middle-man (AKA, the tour operator, travel agent, travel wholesaler or DMC).

Tour Operators: Tour Operators design itineraries, often tailor made, for their customers, liaising with suppliers to organise and book the travel itinerary (partially or start to finish)

Travel Agents: Travel agents liaise with tour operators to book packages and tours for their clients. As such, tour operators will often focus on a certain destination or market area, whereas travel agents can focus on selling the whole world – with a comprehensive list of suppliers in their books

Destination Management Companies (DMC’s) : Organisations that specialise in offering tours, logistics, and planning services for a particular destination. They often re-sell their services to tour operators

Ground Handlers : A ground handler takes care of some day to day operations and tour management such as picking customers up from the airport and arranging sightseeing tours

Associations and Memberships: These organisations exist to provide support, promotion, and opportunity to other players in the travel industry. All of them operate with a slightly different mission, whether it’s to promote sustainable business practices, celebrate the luxury travel market or to connect travellers with LGBTQ friendly travel businesses

Travellers: Arguably the most important cog in the wheel. Everyone in the tourism industry sets out to meet travellers’ needs – to ensure they keep coming back for more!

The beauty of the travel industry supply chain is how all of these key players work together creating one of the worlds biggest industries.   

 Interested to learn more?

The ultimate A-Z glossary for the Travel industry. Understand the different terms, jargon and acronyms.

For a taste of the luxury end of travel, explore our list of Exclusive luxury travel communities

To discover more about sustainable tourism, download our ebook focusing on how to elevate travel design with sustainability.

Travel designers- meet the influencers you should work with.

Understand the role travel influencers play in the industry and why tour operators should be following, interacting and collaborating with them. Explore eight global travel influencers who are inspiring travellers daily.

Tourism news websites you can trust

In the tourism industry it can be hard to differentiate the reliable travel news sources from the not-so-trustworthy ones. In this blog we summarise the top travel news websites that tour operators, travel agencies and DMC’s should pay attention to.

How to set your team up for success when introducing new software

Making changes happen is hard. Especially when it is something that will create a significant impact on the way you work, like new software. We discover what change management is and how it can assist you, your leaders and your team in creating new processes that will make you more successful in the long run. Is it time for a change?

How can tour operators contribute to sustainable tourism?

Sustainability is a key pillar of tourism, with a growing number of people interested in travelling responsibly and sustainably. We explore the easy ways in which your tour operator business can make a positive change. You can help to encourage economic growth and protect our environment whilst also watching your business flourish… could it get better?

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• Tour Operators

Top Tour Operators and Travel Agencies in North America 2024/2025

Top Tour Operators and Travel Agencies in North America. Below you will find 40 of the best tour operators and travel agencies in North America offering in total 698 tours and holidays through-out North America. Combined they have received 784 customer reviews and an average rating of 5 out of 5 stars. The top tour activities offered in North America are: Sightseeing, attractions, culture and history, Adventure and sport & Wildlife, landscapes and nature.

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• North America Travel Guide

40 Tour Operators in North America with 784 Reviews

Adventures Abroad

• Address 2148-20800 Westminster Highway, Richmond BC, Canada
• Response Rate 50%
• Response Time 1 hour

Intrepid Travel

• Address 380 Lonsdale Street, Melbourne, Australia
• Response Rate 90%
• Response Time 2 hours

• Best-in-Class Top 5% of companies
• Excellent Service Top 10% of companies
• Superior Service Top 15% of companies

MiCuba Travel

• Address Veembroederhof 173, Amsterdam, Holland
• Response Rate 99%

Cuban Adventures

• Address Newtown , New South Wales AUSTRALIA, Australia

• Address 33 Kern Road, Toronto, Canada
• Response Rate 88%
• Response Time 3 hours

• Address 6 Fife Road, Kingston Upon Thames, Surrey,, London , England
• Response Rate 84%

Expat Explore

• Address 10 Merryweather Place, London, England

Travel Talk

• Address 18 Exhibition House Addison Bridge Place, London, England
• Response Rate 96%

Insight Vacations

• Response Rate 86%

Marvelus Travel

• Address Avenida Santander Zona 2 , Panajachel, Guatemala

Quark Expeditions

• Address 3131 Elliot Avenue, Suite 250 Seattle, WA 98121, Seattle, USA
• Response Rate 79%

Luxury Gold

• Response Rate 60%

Exodus Travels

• Address Grange Mills, Weir Road, London, England
• Response Rate 85%

Infinite Adventures

• Address 809 W Riordan 100-325, Flagstaff, USA
• Response Rate 100%

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Tour Operators and Travel Agents

Tour Operators are persons or organisation which organised and sells travel like air, railway ticket, transport and accommodation to a tourist. Moreover, a travel agent is a form of business that sells travel related products and services, particularly package tour to the tourists on behalf of travel suppliers such as airline, hotels, tour operator, cruise liners and other travel vendors.

Several travel agencies are specialized in commercial and business travelers while some agencies have setup separate departments dedicated to a separate sector. Several travel agencies serve as general sales agent for larger and foreign travel agencies or companies. A travel agent plays a significant role which converts a countries attractions, accessibility, amenities into saleable goods commodities and promotes, markets, and convince to buyers. Thus, the place of a travel agent is very prominent among the other types of intermediary operations involved in the provisioning and selling of travel products and travel services.

Travel agent:  

Travel agents is defined as   an individual, a firm or company who makes arrangements on behalf of tourists in respect of travel tickets, travel documents-VISA, transportation, accommodation , entertainment, insurance, foreign currency and other travel services from the principal suppliers and sells to the prospective tourists. Thus, the definition clearly identifies that a travel agent/ travel agency is a business may be small or big that sells travel related products and services to end-user customers on behalf of third party travel suppliers/ vendors, such as airlines, hotels and cruise lines. Generally, the clients of travel agencies include tourists and business travellers.

Tour Operator :  

The term tour operator is used to define the large scale operation in the travel intermediary’s process. Thus, ‘tour operators’ can be wholesaler, and or retailer depending upon market size and organizational structure. Thomas Cook, Thomson, American Express, Cox & Kings, Kuoni, Thomas Bennett are good examples of a dual travel organization.  In the Indian tour operation market most tour operators are the outgrowth of successful retail travel agencies in their own travel markets. A Tour operator is defined as an organization/ firm/ company who package the travel to and from a destination along with complete ground services like accommodation , local sightseeing, local cultural fairs / festivals etc. Interestingly, they provide these services themselves as some of the ingredients of tour package they their own or they arrange these ingredients from different destination operators.       

 Generally, the industry practices indicates that a tour operator is a firm /company which specializes in the developing, planning and actual operation of pre-paid, pre-planned holidays and makes these available for tourists either directly or through the  middlemen. In most of the advertisements in the newspapers, magazines and others we have seen regarding five days/four nights along with tour itinerary and price per PAX.   For example, one week in Kerala  5000 Rs. (500 Rs. worth healthcare coupons free or ten days in Goa—heavy off season discounts, beaches, music and other services for Rs. 40000 inclusive meals per PAX etc.  There are numerous offers like this in the newspapers and magazines. Generally, these offers of package tours are available for both individuals as well as groups.  Now the question is that we have ever paid any attention to these offers that who have packages such tours and why? Or how they are packaged   and marketed these products/ services to general public?  Some people arrange these products/ services by their own and some approach the professional organizers to arrangement on their behalf.  When we arrange travel services/ product by own definitely this is a time consuming process. On the other hand there are many people who don’t want to bother themselves about arranging, planning and organizing their own journeys rather they want this to done by someone professional expertise.  It is the tour operator who packages all attractions of a destination into one composite product and retails it through the travel agents or directly to the tourists. He creates the demand, travel, market and image of the destination. Today, many tourists buy these package tours as per their interests, priorities and budget at a price that is pre-determined. The complete holiday package tour includes travels (air/surface), accommodation , sightseeing, insurance, currency, escort/ guide and so on. The person who puts together all these aspects into a package is known as the Tour Operator.

 Practically, a tour operator is a firm/ company who provides travel information, plans, organises and coordinates travel related services/ products with various ground operators to create a tour package. At the same time tour operator also ensures smooth conduct and operation of the package tour due to this professional work a tour operator is also called a Tour/Travel consultant or Tour Coordinator. The tour Operator may or may not necessarily have any product of his own but act as an intermediary for different travel vendors to tailor a package to meet the varied needs of a traveller. In fact, a tour operator plays a pivotal role in organizing, explorations, research expeditions, planning and operation a tour package. We must appreciate here that tour operations originated ever since people wanted to explore new areas/ destinations, go on pilgrimage / religious or trade expeditions, individually or in groups. 

 Definition of a travel agent and Tour operator 

•  The American Society of Travel Agents ( ASTA ) defines the travel agent as follows: “An agent is a person who undertakes a job for another person, who is the ‘principal’. The principal in such a relationship not only sets the goals of the job, such as selling tickets, but also may control the means and manner in which the job is done”.

•  According to Airlines Reporting Corporation (1987), “a retail travel agent is defined as a business that performs the basic functions : quoting fares and rates, makes reservations, arranges travel tickets, books rooms, arranges travel documents, and acts on the behalf of tourism vendors.”

•  Joel M. Abels, (1985) “A travel agent is an individual who, based on recognized industry standards of expertise and experience, is deemed qualified by travel agent peers and by travel principals to offer and sell travel arrangements and services to the general public”.

• Aryear Gregory (1985), “The tour operator is the architect/manufacturer who assembles the tour ingredients and creates travel, creates a market, creates lead and creates an annuity by having satisfied clients who return year after year”. 

•  James M. Poynter (1993) defines, “tour operator is one who has the responsibility of putting the tour ingredients together, marketing it, making reservations, handling all financial and accounting aspects, and selecting as well as managing tour managers”.

•   Mohinder Chand (2006). “ a tour operator is an organization which conceives idea of tourism product and converts this idea into realities by repeating tourists again and again”.

Difference between Travel Agent and Tour Operator

     Historically, the tour operator has mostly emerged from retail travel agency. However, today a clear distinction must be made between a travel agency and a tour operator.

Essentially a travel agent is a retailer and tour operator is a wholesaler. The travel agent is a retailer because he sells the travel services to the final consumers i.e. the tourists directly.

But unlike the travel agency, the tour operator is a manufacturer of the tourism product . He plans, organises, sells and conducts the tours. He acts as a wholesaler also sometimes because he has to engage travel agents as middleman to sell his package tours in different territories. The Figure 1.1 makes amply clear the flow of travel services from suppliers to the tourists. Moreover, the role of travel agent and tour operator in the tourism market is well defined. In fact, due to strategic alliances and world integration this distinction is meaningless as both are performing similar functions. 

The main difference as: 

•       Travel agents usually sell to end-users   on behalf of travel vendors.   

•       Tour operators plan almost each and everything related with tour package.  

•       Tour operators are specialized in dealing with specially one country/ one destination at a time. But there’s no specialization in the case of a travel agent.

•       Most of the cases some travel agents work directly with tour operators and provide the tour operators with the information of clients.

•       Travel agent gets permit to work from the respective tour operator either private or public while tour operator acquires license from the Ministry of Tourism.

•       Becoming a travel agent doesn’t require so much time/ money as compared to the tour operator.  

•       Tour operator is directly responsible to the regulatory authorities while travel agent is first responsible to the clients and then to the tour operator.

•       The main source of income of travel agent is commission and other reserves while a tour operator earned profit by providing services/ products to the clients and he also earned commission from the different travel vendors like hoteliers, transporters, airlines , cruise companies and destination companies etc.

IMPORTANCE AND FUTURE OF TRAVEL AGENT AND TOUR OPERATOR  

    Over the years, the role and contribution of travel agents and tour operators have been changed. In the beginning travel agent were ‘mom and pop’ organisations but today they are more professional and operating a large scale.  Inbound travel has been dramatically hit by introduction of VISA on Arrival and different promotional measures adopted by the Indian government like Incredible India   In fact; all forecasts are that travel between countries will continue to enjoy substantial growth through the 21st century. Thus, tourism between different countries has shown tremendous growth during 2016-2017 and India is no exception in this context.   Recent figures from the Ministry of  Tourism , Government of India have shown that whereas the overall number of domestic holidays increased by 20% between 2000 and 2016,   the domestic market will grow by 20% in the five years to 2017 and this  is  good news for the  tour operation industry. Outbound travel has, of course, enjoyed continuous growth since the advent of overseas package holidays in the 1990s. Whilst the outbound package market has in recent years increased at approximately 10 million holidays each year, independent holidays taken abroad are still growing strongly, and ensure that the overall outbound market continues to grow each year( Ministry of Tourism , GOI, 2016).  

     The following points are clearly described the role and contribution of travel agent and tour operation business in India:   

·  Travel Inf ormation:    

   Travel information is first and foremost activity of a tour operator. Today, most of the tour operators have developed an internet presence by posting a website, with detailed travel information. Moreover, use of technology has become vital for all travel companies. Most of the travel companies hired specially technology firms to maintain their website and upload latest travel information. Moreover, these companies use travel service distribution companies who operate Global Distribution Systems (GDS), such as  Sabre Holdings , Amadeus , Galileo  and World span to provide up to and minute detailed information on tens of thousands of flight, hotel,  transporters, car rental and others related with tourism services including package tours .

•  Tourist Publicity Material: 

    Tour operators produce huge tourism related material to attract and motive the tourists.     Moreover, travel agents and tour operators brought out a range of publicity material including shell folders on adventure, wildlife, tourist resources of South India Rajasthan and other states including tourist map and trekking maps of Himalayas. It also produced a general India brochure and those on various states and tourist destination in India. Thus, they are exploring India at global level. 

•  Promotion of Tourism:  

       Many tour operators and travel agents in collaboration with central or states governments have launched major campaign on “Tourism Environment / Awareness”. These campaigns are being released in all leading magazines across the country in Hindi, English and other Indian languages. The themes of the campaigns are “We can and we will keep India beautiful”. Besides, the department also launches advertising campaigns to promote lesser known bill resorts called “Holiday Campaign”; to promote Orissa and a campaign to promote Andaman and Nicobar and Lakshadweep Islands.

•  Tourism development   Planning :  

       Since tour operators play a pivotal role in tourism industry. They are actively involved and participate in tourism developmental processes and tourism policy formulation in the respective areas.  Every state in India has recognized that tourism has a vast potential for development in the country. Appreciating this potential Government has accorded the status of an industry to tourism.  Government has also extended various financial and non-financial incentives to tourism industry to motivate the tourism players.  Private sector investment has encouraged in developing tourism and public sector investment should be focused only on development of support infrastructure. Thus, travel agent and tour operators are  focusing on the following states so that tourism may developed  in a planned and systematic manners  such as states of Uttaranchal, Himachal Pradesh, Uttar Pradesh, Haryana, Meghalaya, Andhra Pradesh, Kerala, Arunachal Pradesh, Tamil Nadu, Bihar, Tripura, Manipur, Assam, Karnataka and Union Territories of Andaman arid Nicobar and Lakshadweep etc.

•  Promotion of Wildlife Tourism: 

      To  promote wildlife tourism, facilities are provided in the form of Forest Lodges and transport within the sanctuaries / national parks: Forest Lodges at Enjal (Gujarat), Manas (Assam), Dhangari (UP) and Parambikulam (Kerala) is in progress. The work of Forest Lodges Betla (Bihar) Simlipal (Orissa), Desert National Park, Ranthambhor, Ranakpur (Rajasthan). The tour operators are adding these destinations in their itineraries so that special interest tourism may be promoted. 

•  Tourist arrivals and Foreign exchange earnings: 

     As per Government reports,  the year 2016 has been a highly successful year so far as tourism in India is concerned. For the third successive year, India witnessed a positive growth in foreign tourist arrivals. Today, tour operator have been recognised as a vital component of travel and tourism industry and have become an integral part of this industry at global. They Account for more than 90% of international and 75% of domestic tourist traffic. Further, more than 70% of all travel agency revenues are derived from the business travel. Most travel agencies sell both commercial and leisure travel but there is many travel agencies which only specialize in one sector or the other. It is also appreciated that more than 50% tourists are coming through the travel agency and contributing huge foreign exchange to the country.

•  Development of New Products:   

      Various strategies have been formulated and implemented for tourism to meet the diverse needs of the tourists. Such as cultural  tourism,   wildlife tourism, sports tourism, social tourism, mountains and beach tourism, promotion of fairs and festivals,  and  leisure tourism and development of travel circuits.

•  Employment generation Promotional:   

       Travel agent and tour operators are the major players in the tourism industry. In fact, most of the tourism management students are employed in this vital sector of tourism industry.  More the 25 million people  are  working directly or indirectly in this sector. Event many tourism management students are establishing their own ventures. This is also helps the students to enter into their own business enterprises. 

•  Analysis of potential Tourism markets:   

     Most of the tour operators conduct market analysis and accordingly develop product. In fact, tour operators / travel agencies analysed tourism market potentials’ produce modified products based on the existing products and use technologies and skills. They identify potential of both domestic and foreign customer groups with description relevant characteristics like age, income, preferences and influencing factors on future demand. They also identify the unique selling point along with description of wanted characteristics product by the tourists.

      Thus, by 2020, the government of India expects travel and tourism to contribute Rs8, 500 billion to GDP, almost four times the value in 2010. With successive governments committed to reform, a strong manufacturing sector and a private sector that already has a critical mass that is needed to drive growth, it is unlikely that the strong growth in GDP is likely to be reversed ( Ministry of Tourism , GOI, 2017).  

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How many travel agency & tour operator businesses are there in Australia now?

It’s a good time to be involved in the travel industry and travel agency sector. tourism has more or less fully rebounded from the pandemic, air travel is just about back to 2019 levels and airfares are moving in the right direction , while australia’s busiest hub reports that more aussies are travelling abroad than ever before..

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But how is all of this great news actually reflected in the number of travel agency and tour operator businesses that are out there right now?

According to Tourism Research Australia’s ( TRA ) ‘ Tourism Businesses in Australia ‘ snapshot of the growth of tourism-related businesses over the five years between June 2018 and June 2023, the number of travel agencies and tour operators in Australia grew by 7.2 per cent (+572), from 7,952 to 8,524 . 

Considering this came during a pandemic, that’s a healthy rise. Slightly concerning, however, is that during the last of those five years, there was a decline, albeit a small one (-1.5 per cent, 130 businesses) in the number of travel agency and tour operator enterprises across the country.

Perhaps surprisingly, travel agencies and tour operators account for just two per cent of all tourism-related businesses in Australia.

Travel agency challenges

While the increase in the total number of agencies is a positive development for the travel industry, fully staffing those businesses remains a challenge. 

According to a recent survey by the Australian Travel Industry Association (ATIA), only one-third of agencies were able to fill all their vacancies for travel agent roles in 2023. That leaves a lot of companies understaffed – and a lot of potential business left on the table. 

Compounding the problem, there’s also a skills shortage in certain areas, as highlighted by the Council of Australian Tour Operators’ recent launch of the CATO Touring Academy .

The big picture

In June 2023, Australia had an overall total of 355,570 tourism-related businesses, making up 14 per cent of all Australian enterprises.

These businesses operate across nine different sectors, with the largest four sectors accounting for over 90 per cent of all tourism businesses. 

These were retail trade (155,755 businesses, 44 per cent), cafes, restaurants and takeaways (95,958 businesses, 27 per cent), cultural, sports and recreation services (36,422 businesses, 10 per cent), and taxi transport (34,704 businesses, 10 per cent).

Over the five years leading up to June 2023, the number of tourism-related businesses grew by 41,179 (+13 per cent), mainly between 2018 and 2022. However, there was a decline of 5,262 businesses (-1.5 per cent) in the year ending June 2023. 

Smaller businesses, employing fewer than five people, grew faster than larger businesses between 2018 and 2022 but experienced a decline in the following year.

Growth in tourism businesses in Australia between June 2018 and June 2023

The fastest-growing sectors over the five years were car rentals (+53 per cent), retail trade (+16 per cent), and cafes, restaurants, and takeaways (+14 per cent). Only two sectors – taxi transport and casino and gambling services – saw a decline over this period.

State by state, Victoria (+4.1 per cent), ACT (+3.2 per cent) and the Northern Territory (+2.8 per cent) experienced the fastest growth in tourism businesses over the past five years. But in the final year, Victoria, NT and South Australia had the largest declines. 

Additionally, tourism businesses in regional areas grew at a slower rate (+1.9 per cent annually) compared to those in capital cities (+2.7 per cent) over the five-year period, with both regions seeing a decrease in the last year.

As of June 2023, Melbourne has the most tourism businesses (79,993), followed by Sydney (78,002), Brisbane (30,100) and Perth (25,058).

The travel industry winners of the 2024 Australian Small Business Champion Awards were recently announced, with Sonia Jones Travel of Ashgrove in Queensland named winner of the 2024 Travel Agency category .

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【Notice of Proposal Competition】Co-Op Marketing Project with Tour Operators and Travel Agencies for the U.S. Market in FY2024

The objective of this project is to improve the reservation rate of travel products for Japan by conducting a co-op marketing project with tour operators and travel agencies handling inbound travel products to Japan in the United States.

Period of delivery of the Request For Proposals：From April 23, 2024 until 5pm, May 28, 2024 (must be received by Eastern Daylight Time)

Deadline of submission of proposal：By 5pm, May 28, 2024 (Eastern Daylight Time)

The Request For Proposals will be delivered by hand or via e-mail. If delivery of the Request For Proposals is desired, please contact [email protected] in advance.

Please see details below.

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Travel agents' and tour operators' turnover in Slovakia 2010-2014

Annual turnover of travel agents and tour operators in slovakia from 2010 to 2014 (in million euros).

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2010 to 2014

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