12. Tourism components and supply-revised by Ajarn Scott

and Tata

HTM 3102 Introduction to Tourism Management

Travel Trade

Sector

AccommodationSector

Even

ts S

ecto

r

Transportation

Sector

Adventure & Outdoor

Recreation SectorFood Services

Sector

Attractions Sector

Ente

rtain

men

tSe

ctor

Tourism

Services

Supply components

1. Natural resources and environment-

including air and climate, physiography of the region, landforms, terrain, flora, fauna, bodies of water, beaches, natural beauty, and water supply for drinking, sanitation, and similar uses.

2. Built environment (things that have been created by human)

The infrastructure infrastructure consists of all underground and surface developmental construction such as water supply systems, sewage disposal systems, gas lines, electrical lines, drainage systems, roads, communications networks, and many commercial facilities.

The tourism superstructure superstructure includes facilities constructed primarily to support visitation and visitor activities. Primary examples are airports, railroads, roads, resorts, hotels, motels, shopping centres, etc.

3. Operating sectors

The transportation sectors is one of the most important components in the tourism industry because nothing happens until someone leaves home.

Tourists need a place to stay and be fed, so the

accommodation sector and the food service sector are important supply components.

Attractions are the reason people travel.

4. Spirit of hospitality and cultural resources

The development of hospitality resources is perhaps the most important factor in tourism. The finest physical facilities will b e worthless if the tourist feels unwelcome. A favourable attitude toward the visitor can be created through programmes of public information and propagandas.

4. Spirit of hospitality and cultural resources

The social foundation of the destination- its culture, which consists of the language, customs, and religions of the residents of the region as well as their works and related leisure behaviours.

It is the people and the cultural wealth of an areas that make possible the successful hosting of tourists.

Cultural resources include; fine arts, literature, history, music, dramatic art, dancing, shopping, sports, and other activities.

Tourists are often more attracted by a facility designed in conformance with

local architecture as a part local landscape than by the modernistic hotel that might be found at home because

people often travel to immerse themselves in an environment totally

different form their own.

Natural resources

Probably the most noticeable factors are the pronounced seasonal variation of temperature zones, and the changes in demand for recreational use of such areas.

To even out demand, the more multiple-use possibilities, the better.

The closer and area is to its likely markets, the more desirable it is and the more likely to have a high demand.

Operating sectors

AccommodationsFor successful tourism, accommodations must be available in sufficient quantity to match the demand of the travellers who arrive at the destination. Hotels vary tremendously in their physical facilities, level of maintenance,Cleanliness, and services provided. The hotels must provide the physical facilities, price ranges, locations, and services that meet the expectations, wants, and needs of the travellers.

Types of accommodation

1. Hotels are of several types: commercial, resort, motor, airport, and residential.

• Condominium apartments-real estate management firms often manage such apartments or groups of condos within a building or complex and thus serve as agents for the owners.

• Timesharing is a technique of multiple ownership and/or use of resort and recreational properties. It permits purchasers to own or to have occupancy rights of a resort accommodation for a period of time each year for a fraction of the purchasing price of the entire unit.

Activities tourists enjoy most

• Dining at restaurants• Shopping• Visiting historical sites• Visiting small towns• Sightseeing in the city• Touring the countryside• Visiting art gallery/museum• Visiting cultural heritage sites• Etc.

Shopping

Shopping is an important tourist activity and thus an essential element in tourism supply because it affects the success of the tourist destination area.

The most important single element in shopping is the authenticity of the

products offered for sale as they relate to the local area. Tourists can be encouraged to spend more money on shopping if displays are high quality, imaginative, and attractive.

Entertainment

The most satisfying entertainment for

visitors is native to the area.

Not all forms of entertainment can be

successfully described or illustrated in tourist promotional literature.

Formula to Calculate Number of Hotel Rooms Required

R = T x P x L S x NT = number of touristsP = percentage staying in hotelsN = total number of guest nights/number of

guests R = room demand per nights/number O = hotel occupancy used for estimating; divide number of rooms needed at 100% occupancy by estimated occupancyS = number of days per year in businessL = average length of stay

Example

T = 1,560,000 visitorsP = 98%L = 9 daysN = 1.690 = 70 %S = 365 daysR = 1,560,000 x .98 x 9

365 x 1.69

R = 22,306 (rooms needed at 100% occupancy) at 70 % occupancy needR = 22,306/.70 = 31,866 rooms

Task analysis is the procedure used in matching supply with demand. The following steps are usually employed:

1. Identification of the present demand2. A quantitative and qualitative inventory of the existing

supply3. The adequacy of present supply with present demand4. Examination of present markets and the

socioeconomic trends5. Forecast of tourism demand6. Matching supply with anticipated demand

Task Analysis

Global WarningGlobal WarningThe World's Endangered The World's Endangered DestinationsDestinations

The Everglades, Florida: Perhaps no region of the USA is as vulnerable to climate change as Florida . Even a slight

increase in temperature and water level could prove devastating to popular destinations like the Everglades,

Miami Beach and the Keys

Dalian, China   - : Fast growing China, shown here during a prolong ed heat wave last year, is opening about one coal plant every da

y this year. Along with the U.S., China is one of the world's leadi ng contributors to the greenhouse gases believed to be largely

responsible for the increase in the Earth's temperature.

Manhattan, New York City : With high concentrations of popul ation living just above sea level, New York and Los Angeles we

  re listed in a recent report from the Intergovernmental Panel o n Climate Change as being at risk of potentially catastrophic "

    megafloods" resulting from rising oceans and stronger storms in the next century

Halong Bay, Vietnam: With a high percentage of its population living along the coast, Vietnam faces considerable risk from the effects of global warming. Experts worry that developing nations may not have the resources available to thwart the dangers of climate change as readily as wealthier nations

Northwest Territories, Canada: Polar bears have become one of the more obvious victims of the impact of global warming. With about 23,000 square miles of Arctic sea ice melting every year, the bears' hunting grounds are shrinking rapidly. Some scientists predict polar bears will be extinct in the next century

Tokyo, Japan     : Following Tokyo's first winter witho ut snow in 131 years, the plum blossoms emerged

three weeks earlier than normal this year. This occ urrence is being echoed by migratory patterns and

spawning cycles throughout the natural world

South Georgia Island   : Rife with king penguins, seal, whales and albatross, South Georgia Island, located just north of Antarctica

    , has become a popular stopover for cruise ships in the south Atl antic. Studies have shown that both poles are warming at a

rate far faster than the rest of the planet, leading to decreased ice thickness and an increase in ice shelf

disintegration

What are the four (4) major components What are the four (4) major components of supply? of supply?

Give an example of each and briefly Give an example of each and briefly explain how each can influence an explain how each can influence an area’s attractiveness. area’s attractiveness.

Can supply components influence Can supply components influence demand? Explain.demand? Explain.

Classroom QuestionsPair work

Why do we suggest that government Why do we suggest that government

finance certain components?finance certain components?

Are natural resources important for a Are natural resources important for a destination like Bangkok?destination like Bangkok?

In an area just developing tourism, which In an area just developing tourism, which supply component should be created first? supply component should be created first? Last? Why?Last? Why?

Identify hospitality/cultural resources for Identify hospitality/cultural resources for tourism in Thailand. How important are tourism in Thailand. How important are these?these?

Are supply components generally expandable?Are supply components generally expandable?

The Assumption University Hotel Company believes that there is an opportunity to build a profitable hotel in Anyburi but they are not sure whether to go ahead with the project.

They have asked for your advice. After some research you have the following information.

Based on that information would you recommend that they build? If so, how many rooms?

(Show all calculations.)

1.1. Last year there were 1.5 million visitors to the area Last year there were 1.5 million visitors to the area and it is expected to be the same this year.and it is expected to be the same this year.

2.2. 75% of those visitors stayed in hotels.75% of those visitors stayed in hotels.

3.3. The average length of stay was 3 nights.The average length of stay was 3 nights.

4.4. Average number of persons in a room was 2.Average number of persons in a room was 2.

5.5. The average occupancy in the area last year was The average occupancy in the area last year was 70% and it is expected to be the same this year.70% and it is expected to be the same this year.

6.6. Our hotel will be open 365 days per year.Our hotel will be open 365 days per year.

7.7. We believe our market share will be 10%.We believe our market share will be 10%.

8.8. Currently there are 5,900 rooms in the area.Currently there are 5,900 rooms in the area.

R = R = T x P x LT x P x L = = 1,500,000 1,500,000 xx .75 .75 xx 3 3 = = 3,375,0003,375,000 = = 4,6234,623

S x NS x N 365 365 x x 22 730 730

4,623 rooms needed for area @ 100% occupancy.

6,604 rooms needed for area @ 70% occupancy.

at 10% market share = 660 rooms.

Advice: Build Advice: Build

– there is a need for 6,604 rooms and 5,900 exist. Build 660 rooms.

Why are more hotel rooms Why are more hotel rooms needed when estimating a 70 needed when estimating a 70 percent occupancy than a 100 percent occupancy than a 100

percent occupancy? percent occupancy?

Why is 70 percent used?Why is 70 percent used?

Business leaders in Bangkok believe that the area has a strong potential to become a major tourism destination area because tourism has been increasing gradually over the past few years.

They have asked you to analyze tourism supply and demand and advise them on what to do.

Outline the steps you would follow to accomplish Outline the steps you would follow to accomplish this task.this task.

Provide some advantages and also Provide some advantages and also disadvantages of securing foreign disadvantages of securing foreign

financing for tourism developments. financing for tourism developments.

35

THAI TOURISM UPDATE

No. of visitorsNo. of visitors ( (millionmillion)) RevenueRevenue ( (mil. Bahtmil. Baht))

7.227.22

220,754220,754

7.767.768.588.58

9.519.51 10.0610.0610.8010.80

10.0010.00

11.6511.65 11.5211.52

13.8213.82

242,177242,177253,018253,018285,272285,272299,047299,047323,484323,484309,269309,269

384,360384,360367,380367,380

487,000487,000

สึ�นาสึ�นามิมิ**SASA

RSRS**

% = 8.39 %% = 8.39 %40 - 4540 - 45

% = % = 6.03 %6.03 %45 - 4945 - 49

We met the target of 13.82 million visitor arrivals in 2006We met the target of 13.82 million visitor arrivals in 2006

•36

Target for International market in 2007

•2541•2542•2543•2544•2545•2546•2547•2548•2549F•2550F

•RevenueRevenue 545477500,500,million bahtmillion baht (+13.83%) (+13.83%)

•No. of visitorsNo. of visitors 148. 148. millionmillion(+8.42%)(+8.42%)

•7.76•8.58

•9.51•10.06

•10.80

•10.00

•11.65

•13.80

•11.52

•14.8

Target for Domestic market in 2007

8279.3379.5374.8

69.3661.8258.6254.7453.6251.6852.05

2540 2541 2542 2543 2544 2545 2546 2547 2548 2549 2550

•RevenueRevenue 377,800377,800 mil. mil. bahtbaht ( (+8.00%+8.00%))

•No. of Thai visitorsNo. of Thai visitors 8282 mil. mil. - - triptrip ( (+3.35%+3.35%))

Target Market in

2008.985,000 mil. baht

International Market

• Revenue

600,000 mil. baht +10%

• No. of visitors

15.7 mil. +6%

Focus on Europe, East Asia and Middle East

•227,500•37.92%

•+11.39%

•51,000•8.5%

•+3.45%

Revenue

385,000 mil. Baht +1.91%

No. of Thai visitors

83 million +1.23%

Domestic MarketDomestic Market

•3,800•0.63%

•+7.04%

•160,300•26.72%•+9.15%

•81,300•13.55%•+8.98%

•22,000•3.67%

•+12.24%

•3,800•0.63%

•+7.04%

•35,100•5.85%

•+8.47%

BACK TO AMAZING THAILAND

สึร้�างความิชั�ดเจนใน

การ้สึ��อสึาร้การ้ตลาด

ตอกย้ำ��าBrand อย้ำ�างต�อ

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“Be amazed by the varieties

of Thailand’s attraction on

creative print ads”

“Be amazed by trendy lifestyle & high

value for money through trade show &

event marketing”•Wanna be there?

“Be amazed by exotic cultural heritage via

interactivemedia & internet”

“Be amazed by tranquility of

nature & Thainessusing below-the- line

marketing”

44

CHANGES IN CONSUMER BEHAVIOUR

• Social, cultural and economic factors are changing consumer behaviour– More attention to the “value of tourism”– Acquire new experiences– Seeking to learn something new

45

CHANGES IN CONSUMER BEHAVIOUR

– More Global Warming Awareness– More health consciousness– Seeking closer relations with families and friends– Price is a major deciding factor but still willing to

pay for good quality products.

46

CHANGES IN CONSUMER BEHAVIOUR

• More flexible, personalised, individualised and tailor-made

• Automation and Information Technology will play a major role

47

READINESS OF THAI TOURISM PRODUCTS AND SERVICES

• ภาพล�กษณ์#ปร้ะเทศไทย้ำในเวท)โลก2006

•ท)�มิา : www.futurebrand.com•: กองกลย้ำ+ทธ์#การ้ตลาด การ้ท�องเท)�ย้ำวแห่�งปร้ะเทศไทย้ำ

SEVEN AMAZING WONDERS THEME PRODUCTS

Enjoy the Sun Surf

and Serenity

Encounter the Beauty

of Well ness and

Wellbeing

Experience the World’s

Friendliness Culture

Encounter the Beauty of

natural wonders

Excite Your

Senses with

unique trends

Enjoy a Land of

Year Round

Festivities

Explore a Land of Heritage

and History

•น�าเสึนอสึนค�าท)�เป/น

จ+ดแข็1งข็องBrand

วถี)ไทย้ำ ห่�วใจแผ่�นดน

The World’s Friendliness Culture

Land of Heritage and History

มิร้ดกแห่�งแผ่�นดน

Land of Heritage and History

•ว�ดให่ญ่�ไชัย้ำมิงคล: พร้ะนคร้ศร้)อย้ำ+ธ์ย้ำา

Sun Surf and Serenity

ห่ลากห่ลาย้ำทะเลไทย้ำ

Sun Surf and Serenity

•ชัลบุ+ร้)

The Beauty of Natural Wonders

ร้�กษ# ห่�วงใย้ำ ใสึ�ใจธ์ร้ร้มิชัาต

The Beauty of Natural Wonders

•ภ6กร้ะด�ง

สึ+ข็ภาพนย้ำมิThe Beauty of Wellness

and Wellbeing

The Beauty of Wellness and

Wellbeing

•สึปา

Your Senses with Unique Trends

ชั)วตร้�วมิสึมิ�ย้ำ ความิสึ+ข็ใจท)�แตกต�าง

Your Senses with Unique Trends

The Land of Year Round Festivities

เทศกาลความิสึ+ข็ สึ)สึ�นห่ร้ร้ษา

The Land of Year Round Festivities

•ป7ให่มิ�: กร้+งเทพฯ

63

GEOGRAPHICAL MARKETS

• 18 main markets are mainly in the Asia-Pacific, East Asia and Europe.

• 20 Emerging markets include Vietnam, Philippines, Indonesia, Russia and CIS countries, East Europe, UAE and Saudi Arabia.

• New offices in Dubai, Moscow and Vietnam

• Working actively in China

64

INTERNATIONAL MARKETING ACTIVIES IN 2008

E- Marketing

Thailand Fan Club

Golf

Senior citizens

Family

ROYAL INITIATIVE DISCOVERY

73

74

75

DOMESTIC TOURISM

Keep Thailand Beautiful

Tourism Awards

Environmental Conservation

Special OfferSpecial Offer

• Amazing Coupon

82Thank you and Sawasdee