EUROPEAN TOUR OPERATORS

European Tour Operators





European Tour Operators

Introduction

The European Tour Operators has achieved a strong position in the market of the tourism industry. There are two most famous, which are Thomas Cook and TUI Travel with the large market share. However, there is a huge competition in the market now and the industry is facing a number of competitive forces in the tourism industry. Therefore, we find a need to analyse the macro environment of the industry by doing its external analysis. This paper will present the external industry analysis of the European Tour Industry by doing its PEST, Porter Five Forces, and the industry life cycle analysis. In the end, there will be a discussion on the industry's opportunities and threats.

External Industry Analysis

PESTLE

To assess the market of the tourism industry, we will do the PESTLE analysis which will identify the political, economic, social, technological, legal and environmental factors in the external environment of the tourism industry.

Political

The political factors play a great role in the regulation of the businesses. It involves the regulations of government and the legal issues to operate businesses. By doing extensive research, it is found out that the political situation of the United Kingdom is stable. There were some issues regarding the European Union enlargement and the war against terrorism which affected the government's political stability. As there is an increasing awareness of the consequences of the environment, the government of United Kingdom is planning to make sure that the aviation reflects in a certain way. There are some proposals which are emerging for taxes on the fuel and VAT on the tickets. The taxation policies of the government and its decisions regarding the increase in the petrol prices are affecting the people's buying power (Lennon & Foley 2000, 90).

Economic

The factors of the economy are affecting the buying power of the customers and are also affecting the offerings of the different companies. The economy of the country is having the advantage of low rate of inflation. The employment rate is high in the country. That is why the job confidence in people is also high and therefore, their buying power is also high.

The rates of exchange are also in favour of the country's citizens who travel abroad because of the strong position of the pound as compare to the currencies of other countries. Euro is used by a number of European countries as a single currency, and it is highly stable than other currencies. The drawback here is that the differences of inequalities among the rich and poor people of the country will increase more as their demand for travel will increase, and it will also influence in the growth of the travel market of the country.

Social

The trend of making purchases at home through online buying is increasing in the United Kingdom. According to the findings, around 80 percent of the people now use internet at their homes and many of them make online purchases since it is convenient for ...