Making use of the PESTEL framework, identify and discuss the key factors in the macro environment that affect the travel and leisure industry. Political: A large effect on the travel industry could be the stability of presidency. If the government in unpredictable it can be seen as dangerous and unpleasant to see. This can have a big impact on that countries travel and leisure numbers. A lot of governments also choose to generate shopping tax free for tourists, as travelers have the right to claim back VAT (Value-Added Tax)/GST (Goods and Solutions Tax).
By making purchasing in international countries taxes free it has attracted tourists to these countries. As stated in case one terrorist attacks in 2001 had a huge impact on the tourism industry. Everyone was worried because of their safety and so were a lot more subdued to visit. Therefore it has been important that the federal government implemented tighter security and immigration laws and regulations. Economic: Exchange rates can have an impact about tourism, because when forex strengthens or weakens it can affect spending overseas.
For example when the United kingdom pound is usually strong up against the U. S dollar that influences Britons to travel abroad to the ALL OF US, as they attract more for their buck. However it provides a negative impact on UK travel and leisure as the Americans will be put off travelling to the UK and in turn look to holiday in locations within the US (The Guardian, 2007). With the United kingdom Pound even now being solid against other currencies this is certainly relevant to the Tourism Sector today. (Rates List, 2012) Interest rates can easily too impact the travel and leisure industry. If interest rates enhance payments to loans could also increase, therefore those who have loans consequently have fewer disposable salary.
With less disposable salary people are much less inclined to invest it in luxury products, like holidaying. However , nowadays in this state interest rates in the UK are required to stay low (0. 5%), due to the on-going recovery from your Eurozone crisis (BBC, 2012). Furthermore with the current states people are nonetheless struggling, incidents where to hold straight down jobs. Therefore, people have less cash and cannot afford this kind of extravagant vacations, like heading overseas pertaining to long periods of time. Consequently shorter and cheaper holidays look a lot more appealing, for example travelling by car only for a weekend.
Social: There is certainly an ageing population around the globe. With a great aging inhabitants the requirements of the industry will change. People who find themselves in a afterwards time of their life have different needs and wants. There are more and more people who also are inside their later years who wish to travel, to cater for this kind of it may mean advertising focused more upon comfort and relaxation rather than excitement ridden activities. There is a great ever increasing attitude for positivity towards ‘going green’. Folks are purposely searching to only buy products from companies with environmentally friendly practises in position.
Hence, it is important for the tourism industry to take on these types of attitudes too, as it is getting an important element of our culture today to acquire environmental policies incorporated in everyday organization practises The Asian inhabitants is elevating at an instant pace. You will find 3. 9billion people in Asia, which can be 60% of the world’s inhabitants. As stated inside the 2010/11 ITB World Travel Trends Statement, “By 2020, the number of China outbound vacationers could twice and the range of Indians traveling abroad could grow fivefold. This would raise both countries within a 10 years to the top six telephone markets throughout the world. This shows just how quick China and India are becoming powerful players in the travel and leisure industry.
Technological: In our community today fresh technologies will be forever being created to be faster and more efficient as persons want things to take less and less time. Internet has made a big influence within the tourism sector. There has been a reliable incline of online product sales. For example in 2005 on-line bookings for TUI were 15%, which will had doubled in 2008 to 30% (Viardot, 2009). Booking on the web has made this much easier for individuals to book their own holiday seasons.
As well that with on-line bookings this allows for the customers to do their particular research of where the best locations for them to go is, instead of using a travel and leisure agent. Second of all, technologies are really advanced now that communicating with people around the globe is created much easier. For instance, people about opposite attributes of the world can chat easily, possibly even to strangers. This leads to the new craze that people can easily blog and communicate their thoughts to millions of people having a simple mouse click. This new technique of communicating may have a huge effect on the tourism industry.
Persons all over the world happen to be sharing their very own thoughts and feelings regarding everything they actually, whether this is a new product or perhaps an exciting new experience. Environmental: In this current decade environmental concerns have greatly started to be a huge impact in all business industries. Aviators is a significant part of travel. Sadly it is additionally a huge contributor to LASER emissions. A rise in carbon exhausts is a significant threat to climate conditions. As a result there have been even more taxes added to air travel. This kind of increase in income taxes will raise the prices of flying therefore could dissuade people to move abroad.
Normal disasters also can affect a country’s tourism. People are not as likely to travel someplace which is viewed as dangerous and secondly the disaster could ruin attractions. Legal: There are a lot of laws and regulations concerning aviation safety (Department of travel, 2009). Following polices is important concerning ensure almost everything is done to prevent any problems. As if people lose hope in flight companies being safe it could have an impact on travel and leisure. Another legal point is the fact when businesses merge or work with corporations in different countries they need to be aware of the laws and regulations overseas.