Tour costing

Anil Verma
Research Scholar
Reg No-1415819111

Concept of Costing
 A managerial accounting method
that describes when all fixed and
variable costs, including
manufacturing costs, are used to
compute the total cost per unit. Full
costing includes these costs when
computing the amount of money it
takes to produce and distribute one
unit of output.
 In travel and Tourism costing
includes, air travel and local
transportation, lodging, and other
Sight Seeing expenses.
22 08 2014 Tour Costing by Anil Verma 2

Costing Process in Tourism
Itinerary
Airlines Seats/ Railway Seats
Hotel & Meals
Ground Arrangements

Components of Tour Cost
Hotels Meals Airlines Railways
Road
Transport
Cruises Local
Guides/Escort
Miscellaneous

Hotels
 Different types of
hotels
 Types of rooms
 Tariff plans
 Extra bed charges
 Taxes
 Meals

Differential Hotel Tariff Plans
 Seasonal
 Regular
 Season
 Off season
 Weekend Tariff.
 Special rates for
Corporate
 Discounted
Rates for groups

Hotel
 Availability of rooms
 Exact no of Peoples
 Chain of hotels- Oberoi, Taj, etc.
 Regular Contact and Good Relationship
 Extra Bed: INR 1800 DB + INR 300 =
INR 2100
 INR 2100/3 = INR 700 PP

Meals
 Continental Plans (CP)= Room +
Breakfast
 Modified American Plan (MAP)
=Room + Breakfast or any one
Meal.
 American Plan (AP)= Room +All
Meals.
 European Plan (EP)= Only room –
No meals.
 A La Carte = According to the
menu, Pay their own bills
 Most Travel Agents don't include
Lunch because of Sight seeing.

Airline & Railway
 Travel Agents should have
the knowledge of airfares
for different sectors as
required for Itinerary or it
can be Supplement.
 TA should be familiar with
train names, routes,
schedules, and fares.
 Indian railways allow 90
days prior ticketing.
 Also Tatkal Seva is
available.

Road Transport
 Pick-up and Drop Facility from
Airport / railway Stn to Hotel,
Visiting places of attractions or
Sight Seeing.
 Travel Agent should contact
local transport operator for
calculating the cost of the
vehicle for entire tour.
 Drivers charges, parking
charges, toll taxes etc.
 Km travel/ day. Extra charge
for extra km
 Ac/ Non Ac vehicles.

 Cruise
 Cruise Packages for Three
to five days.
 Cost varies for different
categories of rooms,
cabins, on board facilities
etc
 Local guides charges
 English speaking or
Foreign Language speaker.
 Explain monuments or
other sight seeing
 Thus costing includes total
Guides charge divide per
person

Miscellaneous
 Entrance fees – Museums, Historical
forts, palaces, Churches and similar
charges.
 Cultural Show in the evening
 Porterage,
 Desert safari
 Toll Taxes

Pricing
 Mark-up
 In order to earn profits the travel agents and
travel tour operators add a mark up to the
total cost before quoting the price to the
client. Generally 7-15% commission
 Gross rate
 Supplier gives to the Travel Agent which
includes the commission generally 10%.

Preparation of Cost Sheet
 A document that reflects the cost of
the items and services required by a
particular project or department for the
performance of its business purposes.
 Cost Sheet example
 Travel Budget Calculator

Online Travel and Tourism Cost Calculator

 Thank You

Tour costing

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