Professional Documents
Culture Documents
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MTanya Gupta (4915)
Kartikeya Batra (4899)
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At the very beginning, I would like to thank our concerned teacher, m
who has
helped us in compiling this project report. This project could not have been possible,
without her able guidance.
-Authors
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HERMES
THE TRAVEL GODS
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is, in a very crude sense, an inter-state travel and tour
agency, but with more than one difference in terms of its vision, objectives and modus
operandi.
1. We are at present a road-based travel agency and render two basic types of
services:
a. '()*+,-
*.(): For these, we rent out different kinds of private cars with
drivers. The demand of the kind of car from the passengerǯs side depends on the
number of passengers, and the charges increase proportionately with the
number of passengers. In this case, the maintenance charges of the driver (and
guide, if needed) during the entire length of the tour are borne by the company,
and in fact, the final pricing of the tour is done keeping in mind these costs as
well.
b. (*./
*.(): Buses are rented out for these purposes. We provide buses,
guides, drivers and helpers for such tours. The vehicle may be a normal luxury
vehicle or Volvo buses. Once again, the maintenance costs of the guides, helpers
and drivers are borne by the company itself.
For personal tours, we take individual bookings and the convenience of the customer is of
paramount importance. For group tours, people with coinciding time preferences are
clubbed together and groups are sent for the tour. For the same, we have chalked out a final
list of the destinations that we are going to cover. Because we are a new outfit, we have
begun with a strategy where in we have fixed the frequency of the group. With time,
however, as we shall settle down in the market, we shall start dealing in ad-hoc group
travels as well.
Because we are new to the business, we currently have the following vehicles at our
disposal:
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c. 4 Toyota Innova
d. 2 Tata Winger
Ideally, for:
a. (01,2'
*.(3 Driver and the car (and the guide, if needed) are sent to the hirer at
the required location. The kilometers start ticking from our office center and they
end when the car reaches our office, after the entire trip is done. An estimate of the
total cost that is expected to arise is initially charged and the remaining is charged
later. Once again, as we are a new company, we provide services to only the
following places:
1.
: Amritsar, Chandigarh, Katra, Simla, Kullu, Manali, Kufri, Dalhousie,
Ludhiana, Jalandhar, Mussorie, Nainital, Haridwar, Rishikesh, Dehradun, Chehel,
Ranikhet, Agra, Vrindavan, Ambala, Kanpur
2.
: Jaipur, Udaipur, Jodhpur
.
: Jhansi, Shivpuri
4&
5
4
5
Indica A/c 9.00 125.00
Indigo 1.00 175.00
Innova A/c 1.00 225.00
Tata Winger 9 Seater 16.00 225.00
En-route State/Toll Taxes, Parking, Driver Service Charges, Day/Night Charges are to be
borne by the hirer. Minimum Average 250 Km Per day will be charged. Service Tax shall be
levied as applicable. Night Charges start after 10.00 pm to 5:00 am. Full tariff is to be paid
prior to departure at our Head Office. Post 11 pm, our drivers shall not drive if they have
begun at or before pm. In case they started after pm, charges per km post 11 pm shall
be counted as 1.5 times the original charges as mentioned above.
Besides, night halt during stay at the destination shall be Rs. 200 per day (for days) and
Rs. 00 (starting the 4th day), and although the charges for the cars are mentioned in terms
of kilometers, each customer has to mention the specific timings of departure and arrival
back into the city, failing which (in case of avoidable circumstances) Rs. 75 per hour (for
Indica and Indigo) and Rs. 100 per hour (for Innova and Winger) shall be charged.
Charge for guide: Rs. 800 per day (including day of departure from Delhi, excludes day of
arrival into Delhi)
Owing to our not-so-big size, we cannot yet handle ad hoc group tours. Hence, we have a
fixed schedule for the same. Each of the following trips will accommodate 41 tourists on a
first-cum-first-serve basis.
The price is borne by the one group that hires the bus for the trip. In case there are no
groups that solely hire the bus, the final cost is divided amongst all the tourists. One month
prior to the tour, group bookings are closed, because there needs to be enough time to
ensure that the agency is able to market the tour to individual tourists in order to fill the
41-seater. However, the terms are not rigid. A guide, helper and driver are provided for the
entire tour. Overnight charges for buses are Rs. 00/day, with the caveats of timings not
applying because each of the group tour leaves at 5:00 am in the morning.
3
/'(,20*+,-3Damages and repairs to vehicles, fuel, salaries of ad-hoc drivers and guides.
We shall not employ permanent drivers and guides during the initial period of our
business, because of the high levels of fixed costs involved in the same. However, these
costs have already been factored in the above tables.
Besides, for the initial phase, we shall hire 41-seater luxury buses for an average Rs. 40 per
kilometer (with driver). Later, after developing a large enough customer base, we shall buy
the buses for our organization.
Important to note that we have tie-ups with medium-sized stores, restaurants, hotels and
guest houses across these destinations on a commission basis.
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Drivers and Guides are not part of the organizational chart, but are, in fact, sent on tours, on
wage-basis. Besides, there are two pantry boys to assist in the day-to-day functioning of the
organization.
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3 For starters, both the partners pool in an equal capital of Rs. 25,
00,000 each, and hence, become 50-50 partners in the venture. Besides, one of the partners
has a spacious office in West Delhi, with enough car-parking area around the office that can
be used to station the cars that will be employed by the organization.
The remaining initial costs of furniture, salaries, computers, etc. shall be borne out of debts
and loans. Besides, for the first few years, 41-seater Tata luxury buses shall not be
purchased, but will be hired on a case-specific basis. The reason being the high costs of the
same.
3 The partner who owns the office has had a decent history of a successful
family business in the same market area. If at all, this congenial reputation of the family can
be leveraged to ensure initial success and a preliminary customer base from within the
market area. Besides, a highly well-knit network of online socially networked friends for
both the partners shall ensure enough online promotion. One of the partners, in fact, is in
touch with a chum who is adept at building and maintaining official websites.
3 The co-owners are well read in marketing, which eliminates the need
for a marketing head. Apart from this, however, the entire personnel have been hired, as of
now. The fathers of both the partners, nevertheless, have, quite interestingly, dealt in cars
in one way or the other, during their professional life. Hence, although their positions are
not mentioned in the organizational structure, their expertise and experience can be used
during crises.
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9
9
9 9
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A. An international tour and travel agency with an extensive network of
operational centers across the country, if not across the world. Introduction
of franchising system for diversification. Higher profits, more tours and a
close-knit organization with the highest quality possible amongst all drivers
and guides across all the franchises.
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9
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A. Once the road travel is successful, we shall expand into rail travel as well,
which shall not be a big problem. However, the next stage shall pose a bigger
challenge, as we would want to foray into air and sea travel. While air travel
shall mean being in touch with various airline operators, travel by sea shall
imply communication with different cruise services.
A. All kinds of travelers, moving upwards from the lower middle class shall be
our customers. For the lower middle class and the middle class, we shall have
road and rail travel, while for people who belong to higher income groups
shall be best served by our air and sea services.
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9
A. Extensive reach across borders and exhaustive knowledge about the same,
value-for-money travel and warm and affable experiences on all tours with
our personnel.
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A. The co-owners shall be the marketing heads of the organization. Through
various innovative means, the business shall be marketed across the
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spectrum. There shall be individual packages designed for all kinds of
customers: children, housewives, working women, etc., apart from the
conventional packages meant for families. There shall be associations with
offices, schools and colleges that shall come in handy. With such
organizations, there shall be a subscription fee system that shall ensure long,
consistent and durable relationships.
Our guides and drivers shall be trained with a focus on embedding an affable
attitude towards the travelers. The USP shall remain:
a. Extensive reach and exhaustive knowledge w.r.t. destinations
b. Warm experience
c. Value for money
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9 9 99 9
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BUSINESS SIZE Intra-national operations, road International travel agency that
AND SCOPE travel based in Northern India, a operates across boundaries
central office with a handful of dealing in all forms of travel
personnel, and dependence upon (maybe even space in the next
case-specific employees with few years) with a highly
varying quality levels (even if extensive network of offices.
there are little variations). Close-knit family of permanent
employees trained in standard
practices and procedures, in
order to maintain the highest
levels of efficiency and
standardization.
MARKETS & Lower-Middle and Middle Class. All kinds of families. Besides,
LINKAGES Primarily meant for typical special packages for children,
Indian families (nuclear and joint, housewives, working women, etc.
both). Linkages with a limited Association with various
number of hotels and restaurants institutions and organizations on
across a few select destinations a subscription basis. Linkages
with little bargaining power. with a large number all kinds of
hotels and restaurants (that cater
to different economic segments)
across all destinations with
considerable bargaining power.
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SOCIAL None Periodic tours for the
RESPONSIBILITI underprivileged via associations
ES with schools for the disabled, old
age homes, etc. Promotion of eco-
friendly practices, including non-
usage of plastic, use of CNG, strict
adherence to pollution control
levels, association with outlets
selling merchandise produced by
the disabled, etc. are some of the
other means of discharging these
responsibilities.
WORK FORCE 9+Ad Hoc Staff (Only the central 15-20 (including permanent
(NUMBER AND office) guides, drivers, etc.)+Franchise
SKILLS) System with each franchise
having its own manager, staff,
drivers, guides, vehicles etc.+1
representative elected by the
central office for each franchise
3 While the endeavor is to hire permanent guides and drivers and give them
standardized training, their number can be very large as the industry is season-based. The
number of permanent staff should be determined only after considering the minimum
possible number of tours. Beyond this, handpicked ad hoc drivers and guides whose
attitude and efficiency are close to those of the permanent staff shall be employed.
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Following is the 7 S framework of the companyǯs that the company aims to achieve in the
next few years:
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segment-specific efficiency in check the
packages. Response maintenance of these standardized
to special marketing records and the procedures that
campaigns is financial ought to be followed
analyzed and performance of each by technicians,
corrected for future franchise. This helps drivers and guides.
endeavors. The same in planning for
practice is followed future strategies and
across franchises. In plans.
case a franchise is in
its early
stage/performing
very poorly, reports
of the same are taken
on a monthly basis.
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campaigns, which is etc.
once again
dependent upon the
understanding of the
consumersǯ psyche.
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*-020 ,-3There will be now direct political ramifications to this business, at least in
the foreseeable future.
*+*>0 3 Fuel prices driven by international dynamics shall have a bearing on the
prices of the tours and packages. High inflationary trends may dissuade tourism and
may elicit attractive schemes and packages from our side.
# * 0,-3 Decreasing number of joint families and increasing number of nuclear
families shall eventually mean higher demand for personal tours, and larger number
of group tours that involve individual tourists, instead of large families hiring
facilities together.
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' <+*-*@0 ,-3With improving models of cars and other vehicles and improving
accessories and maintenance materials, technological improvements, in the form of
new cars, new accessories and new materials, coupled with equipping employees
with the relevant information about the same are needed.
*-*@0 ,-3Growing focus on eco-friendly practices isbecoming an essential aspect
of every business. Especially in the case of a business like ours that employs
resources that have the potential to negatively impact the environment, we need to
ensure that we use as many eco-friendly methods as possible, some of them being
use of CNG vehicles, adherence to emission norms, promoting cleanliness through
word-of-mouth from guides on tours, etc.
'@,-3All vehicles and drivers must have the relevant licenses. Proper registration
documents for the business should be procured. Guides, helpers and drivers must
not indulge in any legally controversial activities when on tours.
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<(',2*='9+2(,+2)3The industry of tour and travel in India is growing. While
competition with regards to domestic destinations is quite squeezed up, and initial
investments are quite high, it may not attract many new entrants. When it comes to
air and sea travel, one needs to have a good enough customer base to deal full time
in such high-stakes deals, which merits experience. Once again, new entrants are not
attracted very much.
+2(,&+7.)2(;01,-(; *>/'2020*+3As mentioned earlier, the industry is quite
intensely fought. Hence, the company shall have to continuously innovate and
develop new points of competitive advantage to ensure sustenance and existence.
From road to air to sea, there are competitors in every aspect of this industry, and
this is one of the major threats to the companyǯs performance and standing in this
industry.
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# à.;'(:)à,(@,0+0+@*9'(3Buyer information, thanks to the internet and other
such sources, has become very high. Service differentiation may not necessarily be
an important facet. However, although buyer volume may be high, due to the
presence of a large number of competitors and substitutes (online booking agencies,
etc.), buyersǯ bargaining power has gone up. Besides, on occasions pertaining to
road travel, travelers can integrate in the backward direction, and hence, this
increases the buyersǯ bargaining power. In essence, the buyersǯ bargaining power
remains high, although geographically speaking, there is monopoly for our
organization.
? .//-0'():à,(@,0+0+@*9'(3Major suppliers of our business are suppliers of
cars, maintenance materials, etc. Because these are present in abundance, they will
not enjoy much of bargaining power. Besides, there is little scope for forward
integration.
<(',2*=.A)202.2')3Hotels, resorts, etc, that are being built in the vicinity of
major cities are providing tourists with similar experiences as tourist destinations.
Although such threats exist, there arenǯt many of these that can threaten the
existence of our organization.
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f. Increasing expectations of travelers w.r.t. quality of tours in all regards
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Total #?
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1. High level of focus on interpersonal relationships with customers
2. Value for money
. Packages aimed at long-term relationships with big organizations
4. Exhaustive knowledge and know-how in areas being dealt with
1. Well-knit network of potential customers that shall help in personal selling
2. Various in-house resources that are being put to good use, eg.- Marketing acumen of
the owners, IT acumen of chums and operational acumen of relatives
. Association with various ecological and social causes from the very beginning (It
may not remain a competitive advantage for a very long time)
4. Zero cost on office rent
5. No borrowings on initial capital
TRENGTHS: Well-networked, personal resources of promoters, high involvement of
promoters, stress on ecological and social factors, foray into only those areas that are well-
known
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4. Foray into only those areas that are ? ?%
well-known
5. Stress on ecological and social !
factors,
6. No experience
7. Lack of permanent staff ? ?
8. Too simplistic an approach ? ?
9. Limited operations
Total
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We define our organization into more than one strategic group based on the following
parameters:
1. PRICE: Medium Priced catering to Middle and Upper Middle Income Groups
2. GEOGRAPHIC SCOPE: Northern India (primarily)
. MODES OF TRAVEL: Road (at present)
4. ASSOCIATES: Medium-sized hotels, restaurants, stores
1. To maintain the highest levels of efficiency with our vehicles and employees
2. To develop long-lasting relationships with organizations that shall deal with us on a
continuous basis
. To discharge our responsibilities towards the environment and the society
4. To provide value for money
5. To operate at a decent capacity level (depending upon circumstances, without over-
stretching personnel) and provide value for money
6. To operate in only those areas that we have full knowledge and expertise about
1. Lower Prices
2. Focus more on quality
. Market less on price and more on qualitative aspects
4. Leverage existing networks
5. Ask for price reduction from associates at different destination points
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1. Introduction of franchise system
2. Hiring more permanent staff
. Foray into activities like facilitating easy visas and passports, etc.
4. Tie up with large-size hotels, restaurants and stores across destinations
5. Start operations on air and sea routes
6. Teaching personnel techniques to standardize operations across all centers
7. Use of proper control techniques in order to ensure solid growth
8. Buy more fuel efficient vehicles
9. Foray into space travel, if possible
10.Tie up with more and more organizations on a subscription basis
11.Increased focus on ecological and social responsibilities
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1. Start with the already existing network of customers and leverage the same
2. Keep the numbers of tours low and base them on case-specific basis, and remove the
periodic regular tours as they increase fixed costs
. Continue with existing vehicles and ad-hoc personnel
4. Reduce prices, and attract more customers by offering new and innovative packages
and give them extra sops like free night stays, merchandise, etc., depending upon the
specified case
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This analysis is not applicable to our firm as we do not have any SBUs at this point in time,
and neither do we plan to have the same in the near future.
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Following are the control techniques used to ensure proper control on all fronts:
1. Constant feedback from all travelers after every trip in order to ensure proper
quality of services provided by drivers, helpers, associates across destinations and
guides.
2. Responses to special packages and marketing campaigns are registered and acted
upon, in case the need be.
. Finances are checked periodically. Prudence with occasional aggression is used to
ensure the best results.
4. Motivation levels of employees are checked by regular interviews on a periodic
basis.
5. Periodic surprise visits to destinations by the owners are also encouraged in order
to ensure the highest levels of conformity by the employees.
6. Vehicles are sent for regular maintenance and up gradation, in case the need be.
7. Number of members in the companyǯs database is regularly checked and targets are
set to increase the same periodically, in order to ensure that the size of the
contactable market increases.
8. New destinations are added to the companyǯs portfolio regularly, and guides and
drivers are asked to be equipped with every single piece of information for the
same. In order to make them better equipped, special training classes and
workshops are held.
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Sources referred to while compiling this report include:
1. Managementlab.org
2. Indiancarrental.com
. Quickmba.com
4. Netmba.com
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