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BATANGAS STATE UNIVERSITY

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Chapter I
BACKGROUND OF THE STUDY

This chapter deals with the presentation of the background of the study.

Specifically, this presents an introduction, the overview of the business, the

objectives of the study and the scope and limitations of the study.

Introduction

Traveling has become an integral part of the lives of many people. Travel

expands our minds, broaden our perspectives and appreciate life, have an

adventure, break away from the stressful life and most importantly, relax. In the

Philippines, domestic and foreign travels had seen an increase based on the

recent statistics of the government. The tourism industry plays an important role

in the Philippine economy. The country boasts of rich natural beauty in its many

spectacular beaches, sunny weather, and rich biodiversity. More than that, the

Philippines’ unique and complex culture, as exemplified by its people, cuisine and

lifestyle, attracts many people to visit the country.

Based on the 2016 results of Household Survey on Domestic Visitor by

Philippine Statics Authority, around 59% of Filipinos 15 years old and above,

have traveled at least once in 2016. Data shows that the main reason for

traveling has been for pleasure and vacation purposes.

There is a significant increase in the number of tourist arrivals in 2018.

Specifically, the country has welcomed around 5.8 million visitors - that’s 8% over

the previous year. As being engages in the tourism industry, we are on the brink
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of penetrating a lucrative market in a rapidly growing industry. The current trend

towards an increase in the number of tourists entering the country presents an

opportunity for Trouvaille Travel and Tours to penetrate the market. Trouvaille

Travel and Tours has an opportunity to exist the success because the national

tourism industry is growing at a rapid pace annually. Trouvaille Travel and Tours

is poised to take advantage of this growth and moderate competition in the travel

portion of the industry, with a dedicated and proficient staff, and effective

management and marketing. Trouvaille Travel and Tours intends to provide travel

and tour packages to tourists. Services and products provided by the company

will initially include pre-arranged tours, custom packages according to clients’

specifications, travel consultation, and as time progresses making reservations

for accommodation amongst other related services including the assurance of

security of clients. Trouvaille Travel and Tours seeks to differentiate itself as the

premier travel and tour agency operator in the greater Philippine area.

Overview of the Business

Trouvaille Travel and Tours is a Philippine-based company which aims to

provide individual and group travel to leisure clients. Services and products

provided by Trouvaille will initially include pre-arranged tours, custom packages

according to client’s specifications, travel consultation, and as time progresses

making reservations for lodging amongst other related services. As it grows it will

take on people and expand into related markets and services. It will also look for
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additional leverage by establishing relationships and representations with

appropriate strategic allies.

Mission

To serve our clients with enhanced travel experience by providing quality

services that will satisfy their needs and surpass their expectations.

Vision

To become the leading travel agency in the industry providing efficient and

effective services, and demonstrating faithfully our commitment towards social

and environmental responsibility.

Objectives

Our business strategy will revolve around the need to provide quality

service to our various target customers, in the process fully satisfying their

needs. This shall be undertaken through the recruitment of a proficient team and

the provision of good quality custom-designed travel packages, catering to the

client's particular needs.

With time, our marketing campaign will increase the awareness of our

services in the various market segments we shall be targeting. This is particularly

so with the organization looking at establishing a clear advantage in an

increasingly competitive market. We intend to establish a good camaraderie with

all the relevant interested party, especially hotels and other principal suppliers.

We also intend to have well-designed brochures and other promotional material

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that will enable clients to have an understanding of the types of services we offer.

Consequently, this will undoubtedly generate increased sales of our service.

Objectives of the Study

The general objective of the business plan is to establish the proposed

project. Moreover, the study specifically aims to:

1. Present all the possible marketing strategies applicable to the business

which can help in achieving its goals.

2. Present the operation process, manpower requirements, location, layout,

and other material management related to the operation of the business.

3. Present the legal form of the business, organizational structure, the

qualifications of employees or workers and their compensations.

4. Present the total project cost, the source of financing, the assumption

used and the financial ratios which are essential in interpreting the

financial stability of the business.

5. Present the socio-economic contribution of the business including the

evaluation of the effects and benefits of the business to the environment,

community, and economy.

Scope and Limitations of the Study

The study will tackle the proposed establishment of a travel and tours

company that is located at the corporate office in San Jose, Batangas. The

business plan includes the market, operational, financial and socio-economic

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aspects of Trouvaille Travel & Tours. These aspects serve as the basis in the

determination of the scope and limitations of this study.

In terms of the marketing aspect, the study includes the description of the

service, target market, demand and supply analysis, projected sales, marketing

program/strategies, and marketing/selling expenses. Descriptive research was

used. The operation description, process, labor requirement, plant location, and

layout are included in the operational plan of the business research project. On

the other hand, the organization plan focuses on the form of ownership of the

business, organizational structure, the job specification and description of

employees, office equipment and administrative expenses. The financial plan

focuses on the total projected cost of the project, sources of financing, list of

assumptions used, projected financial statements and financial analysis. The

socio-economic aspect deals with how the firm will contribute to the Philippine

economy, social desirability or employment and environment conservation.

Definition of terms

This study sought to define the terms used throughout the paper for

readers to easily understand the following:

Booking or Reservation. This is a seat/room or another service to be provided

to a traveler or hotel guest, at some future date or time. When a reservation is

made, it is a promise to provide the client with an agreed product or service for

which the client promises to pay.

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Optional Booking. It is a reservation which is held for a fixed length of time only

and at the end of that time, it must be confirmed and paid for or canceled.

Confirmation. This a clear statement, which ensures that the service to be

provided is held firmly available and will be paid for.

Overbooking. It occurs when a hotel sells more rooms that it has available or an

airline sells more seats than those that actually exist on a flight.

Industry Principal. It can be described as a primary provider of service, such as

an airline.

Deluxe Hotel. A hotel with the highest standards of service and facilities.

Tourist Hotel. A hotel which is in the lower price range.

Resort Hotel. A hotel which mainly caters for holidaymakers, and which contains

a high level of leisure facilities within its complex.

Double Room. A room for two people with one double bed.

Twin Room. A room for two persons.

Single Room. A room for one person.

Hotel Rate. The price charged by a hotel for the various types of room on offer.

Full Board or American Plan. A hotel rate which includes accommodation and

three meals.

Half Board or Modified American Plan. A hotel rate which includes

accommodation, breakfast, and either lunch or dinner.

Continental Plan. A hotel rate which includes accommodation and breakfast

only.
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European Plan. A hotel rate which includes accommodation only.

Check-in. At an airport ‘check-in’ when he/she goes through the formalities

required to board an aircraft. A hotel guest ‘check-in’ is when he/she registers

with the hotel reception. This involves completing a registration card which gives

details about the guest.

Check-Out. These are the formalities which a hotel guest undertakes before

departure.

Cancellation Fee. This is the amount paid by a passenger or guest who cancels

or fails to use a reserved flight or accommodation.

Commission. The amount paid to a travel agency by airlines or other suppliers

of services for the sale of air transportation or other services.

Destination. The place to which a person is traveling.

Origin. The place from which a person is traveling.

Fare. The amount to be paid for transportation.

Peak Season. This is the time of the year when rates are the highest.

Low Season. The time of year when tourist numbers are small.

Shoulder Season. The time that falls between peak and low season.

Inclusive Tour. This is a complete package which includes transfers, transport,

and accommodation.

Mark Up. It is the amount added to the cost price of goods to cover overheads

and profit.
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Buying Power. It is used to increase the profit by reducing the price form the

principal suppliers on each sale for the package.

Cash Flow. The total amount of money being transferred into and out of the

business, especially as affecting liquidity.

Net Rate. It is the price of the supplier meant for the retailers and on which the

agency base the prices of the products and services.

Gross Rate. It is the rate which a supplier quotes to the agency for the products

and services.

Visa. A foreign document through its consular offices issued this authorization

and its specify. The terms under with a government are allowed to enter into that

foreign country.

Passport. A document issued by the Philippine Government to its citizens

requesting other government to allows its holder to past safety and freely and in

case of need give him/her lawful aid and protection.

Escorted Tours. The group of people who separately bought the tour package

and are meeting for the first, structured journeys on which the tour participants

are accompanied by a tour manager who sees to their needs.

Hosted Tours. It is similar to escorted tours but the “host” or the tour

representative only meet with the tour travelers when they need to see them.