Tourism Industry In Uk Benefits And Challenges Tourism Essay

Tourism industry in UK has vastly contributed to the economic development in the state. The industry occupies a alone place as the UKs 5th largest industry, 3rd largest export earner and deserving ?115 billion a twelvemonth. Besides, it employs over 2.6 million people and supports over 200,000 Small Medium Enterprises ( SME ‘s ) ( beginning:, 2012 ) . Although, the industry has been helpful to the state ‘s economic system, there has been stagnancy of growing late, due to few cardinal issues and challenges.

In position of that, this study has decided to focal points on benefits and challenges of the touristry industry in UK. The study commences with the background history of UK every bit good as vision, mission, purposes and aims of the study. It besides seeks to clarify what strategic place is every bit good as touristry from a different position. It farther discusses the overview of the touristry industry in UK and its parts to the UK economic system. More so, it discusses the jobs and challenges confronting the industry. The study will besides propose strategic options such as a strategic attack to destination selling and action program. The study concludes by doing strategic recommendations and sum-up of two cardinal challenges confronting the industry.


The United Kingdom is a state that consists of England, Scotland, Wales, and Northern Ireland. It is a fantastic state with diverse civilization and tradition. It is extremely belief that, the nature of the people in the state, its landscapes, civilization, character, history and traditions ; its accomplishments, impact, successes, and standing ; and its hereafter, its vision, its possible makes Britain Great. Based on aforesaid features of the state has reckoned its ain people, and people from across the universe to see Britain, to cognize Britain and to understand Britain ( Source: Former Prime Minister, Tony Blair ) .

The state is a Member of overplus administrations which include the European Union, North Atlantic Treaty Organisation ( NATO ) , Commonwealth of Nations, World Trade Organisation ( WTO ) , and Organisation of Economic Corporation and Development. UK has the lasting place on the United Nations Security Council. Through touristry parts, United Kingdom is the universe sixth largest economic system and World ‘s first industrialized state with a population of over 62.4 million ( Ref. UN, 2011 ) .

Vision, Mission, Aims and Aims

Our vision, mission, purposes and aims are to ;

better the UK portion of touristry worldwide and its part to UK economic system, employment and quality of life.

addition UK portion in planetary visitant market

construct on Britain image and increase merchandise scope for visitant

Make easy to acquire in UK

better the battle of visitant with merchandises

Bettering market entree and connectivity

Developing and marketing competitory tourer finish in UK

Understanding Strategic Positioning and Tourism

Harmonizing to Michael E. Porter, ( 1996 ) ‘strategy is the ability to do an informed determination about how, when and where to aim a client group, facilitate resources and put aims ( bounds ) makes the difference between directors who thinks from a strategic position in visible radiation of what might emerge in future ‘ . Tribe ( 2010 ) , views a generic scheme as “ a scheme of a peculiar type or signifier designed to advance a permanent competitory advantage for an organisation ” .

Lovelock ( 1991 ) , describes positioning as the procedure of set uping and keeping a typical topographic point in the market for an administration and/or its single merchandise offerings. Porter argues that positioning is a perfect manner to form advantages within a company and can be grouped into variety-based placement, needs-based placement and access-based placement. To him, the procedure whereby merchandises are selected based on superior value concatenation optimisation that produces a specialised merchandise within an industry is called varied-based placement ( hypertext transfer protocol: // , cited in Porter, 1996 ) .

Puting them together, Strategic Positioning is the placement of an organisation ( unit ) in the hereafter, while taking into history the altering environment, plus the systematic realisation of that placement ( beginning: hypertext transfer protocol: // ) .

Typologies of Strategy

Michael Porter ( 1980 ) has categorized generic schemes into Cost Leadership, Focus and Differentiation. To him, houses can utilize this scheme to accomplish competitory advantage. On the contrary, any company that lacks a clear scheme can stop up in a clutter and confusion ( Porter, 1980 ) . Diagrammatically, this is Porters

Cost Leadership: Porter opines that a house can win a market portion by appealing to be or price-sensitive clients. The house can make this by holding the lost monetary value in the mark market section.

Focus: As the name denotes, it is based on strategic range of the company ‘s competition. Therefore, this strategic range of the industry is based on either cost leading or distinction. Based on this attack, the touristry industry can take to conflict in the mass market with wide range or in a defined market sections with a narrow focal point.

Differentiation: As the name implies, in order for the industry to out-think their rivals successfully, the industry must larn to distinguish its merchandises by seeking merchandise singularity.

Price-based schemes: The Price-based scheme has similar characteristics with the cost leading. However, the duality that draws between them is that, price-based scheme topographic points more accents on low cost which frequently seen by clients as the signifier of lower monetary value ( Tribe, 2010 ) .

What is Tourism?

Harmonizing to, Guyer Feuler ( 1905 ) , “ Tourism is a aggregation of activities, services and industries which deliver a travel experience consisting transit, adjustment, feeding and imbibing constitutions, retail stores, amusement concerns and other cordial reception services provided for persons or groups going off from place ” . In simple footings, it is the motion or going from one ‘s usual environment to another environment for some period of clip with the purpose of exploring, for leisure, concern or other related intents. Tourism can be categorized into Domestic, Outbound and Inbound.

Domestic touristry involves people taking vacations, short interruptions and twenty-four hours trips within UK.

The outbound touristry has to make with the people ‘s motion from UK to other states, districts or states to research.

The inward touristry involves single travelling from other topographic points such as Ghana, Togo, USA etc. to UK


The Overview of Tourism Industry in UK

As indicated earlier, touristry is a valuable beginning of foreign exchange, the UK ‘s 3rd highest export earner behind chemicals and fiscal services. Abroad visitants spend around ?18 billion a twelvemonth in this state and they contribute more than ?3billion in revenue enhancement and responsibility to the Exchequer ( VisitBritain Consultation Document, 2012 ) .

It is the 7th largest international touristry finish based on the visitant ‘s outgo ( Ref. UNWTO, 2011 ) . It means that, France, USA, China, Spain, Germany and Italy are all in front of UK in the touristry hierarchy ( Ref. UNWTO, 2011 ) . The inquiry here isaˆ¦ . `what might be jobs or challenges ensuing to hapless attending of tourers in UK.

Research has reviewed that, touristry in UK is highly turning faster than any other economic sectors. It is outpacing excavation, agribusiness, and fishing as a taking industry for the state. One could see the value of touristry in UK is highly high. However, pieces UK touristry performs good, international touristry is ferociously competitory concern and their rivals are upping their game ( ) .

Notwithstanding that, there some challenging ‘s sabotaging the tourer industry in UK. The industry is confronting job on how to make a competitory, first touristry industry in Britain which can fit both the quality and the best of British concern every bit good as the graduated table of touristry in Britain in peculiar.

UK ‘s Position in the International Market

The part of the touristry industry in the UK economic system has been really encouraging. As of 2010, the part of touristry has a entire gross of ?110 Billion and 2011-?120 Billion per annum ( UK Tourism Statistics, 2012 ) .

Visitors ( ?m ) Spent ( ?Bn )

Leisure 11.5 6.6

Business 6.8 4.0

Students 0.5 1.4

Other 2.4 1.2

In 2011 ( Ref: International Passenger Survey, 2011 )

* 1 % addition in the cost, significance, touristry gaining bead down by 1.3 % ( Sensitive Tourist, 2001 )

However, the industry ‘s place in the international market chart has been falling for the past 3 old ages now. for UK touristry industry is acquiring tougher. This is because the competition in the planetary market topographic point has become really tough as a consequence emerging finishs and other outstanding finishs such as France, Italy, Malaysia, Turkey, U.S.A etc. Although the industry was able to crush the cut-out point set for twelvemonth 2012, yet the state ‘s place in the planetary market is still worsening.

In 2011, as illustrated in Tab.1 below, UK came in the 7th place in the universe categorization of tourer finishs. The growing in planetary travel over the last two decennaries means that UK is viing against more finishs, for a larger figure of possible visitants ( ) .

Tab.1: Popular international touristry finishs ( 2011 )




Staying visits

( m )




















United kingdom











( Adapted from VisitBritain ( 2012 )

The Contribution of Tourism to the UK Economy

The part of UK touristry industry to the national economic system demonstrates the magnitude and complexness of the industry. Harmonizing to VisitBritain ‘s CEO, Sandie Dawe ( 2012 ) , touristry has enormously contributed to the development of UK economic system. To her, the industry can turn by more than 60 % which would be amounted to about ?188bn by 2020. Besides, the figure of occupations straight and indirectly linked to touristry could lift by 264,000 to 2.89 million by 2020, said the survey for VisitBritain.

Deducing from this, one could see that, touristry is a major subscriber to the balance of payments, while it is one of the few activities which would enable UK to accomplish competitory advantages through the redistribution of labor within Europe ( Economist, 1993:5-6 ) .

It is besides a critical incentive of the UK economic system cut downing the shortage of the balance of payments, hiking employment, bring forthing income, and lending to regional development ( Zacharatos, 1989:274 ; Truett & A ; Truett, 1987:178 ) . In fact, touristry per Se is one major generator of wealth in UK economic system.

Key Issues and Challenges

This subdivision of the study discusses the major key issues and challenges confronting the UK touristry Industry.


There are several challenges facing the touristry industry in UK. The factors ensuing to these challenges can be grouped into internal and external.

Internal Factors: They are the factors that involve the domestic personal businesss of the state. They include ;

Tax of adjustment and nutrient: Research has revealed that UK hotels and eating houses overtaxed in hurt to revenues for the wider economic system. Therefore, most UK hotels and eating houses charges full VAT rate on tourer adjustment, repast and attractive force. There are several stores and eating houses in UK that charges revenue enhancement on everything tourers buy. A noteworthy illustration is McDonald- any nutrient bought from McDonald has been tag with revenue enhancement. This has made most of the tourer to lose involvement in the UK touristry industry.

Entry Visa: It is an established fact that, for one to acquire tourist visa to UK is really hard. Not merely as hard but besides expensive as compared to other tourer finishs. For case, to acquire a tourer visa to UK, one has to pay an Amount of ?78 pieces Schengen visa is ?53. So relatively, people would prefer traveling to Germany and other finishs in stead of UK.

Increase in Price: A research conducted by San Francisco State University indicated that, the monetary values for local goods and services have increased by 8 % as a consequence of touristry development. What it means is that, touristry development has enormously increased in both edifice costs and land values. This is because the rich are now utilizing the lands to construct and prosecute in existent estate for touristry intent. This has resulted in trouble for the autochthonal people to run into the basic needs to buy lands for their ain usage.

Economic Dependence: Harmonizing to Marshall ( 2012 ) , “ over-reliance on touristry, particularly aggregate touristry carries important hazards to tourism dependent economic systems. He argues that economic recession and the impacts of natural catastrophes such as tropical storms and hurricanes every bit good as altering touristry forms can hold a annihilating consequence on the local touristry sector.

In add-on, the decrease of UK Government funding on touristry industry is a factor. Therefore, the subsidy given by the UK authorities as a back uping assistance to the touristry industry has dropped by ?48.0m to ?35.9m, which is 25 % lessening in 2011. This has besides made the industry to take drastic determinations to run into up their demand by seting high charges on clients visit.

External Factors: The external factors are factors that are coming from outside and they include ;

Turning Competition: Competition from bing and emerging finishs is another challenge: The emerging finishs like China, Malaysia, and Dubai are the states that are turning at a fast rate in the touristry industry. The major challenge here is how to make a competitory, first touristry industry in Britain which would fit both the quality and the best of British concern and advanced policies to make value and enhance of fight.

Climate Change: As the conditions in UK is unpredictable, tourer most frequently complain of been disturbed by rain and unfavorable conditions conditions. This has negatively affected the industry since most people are discouraged by shiping on the journey to UK.

International Economic Crisis: Another of import external factor is the international economic crisis that hit the G8 and most Europeans has accordingly affected the industry.

New Trends in Demands: The International touristry is traveling to a degree where consumers are demanding in new and varying activities which would prosecute them ever. Consumers are demanding for new countries such as eco-tourism, health-tourism, sports-tourism, activity-tourism and instruction touristry. This means tourers are no more interested in the civilization or geographical location of the state.


This subdivision of the study focuses on the Marketing scheme and action program which has to make with followers ;

Consolidating present merchandise offering and develop highly-focused new merchandises

Specifying new mark market and set abouting market incursion

Puting up alone market placement and distinguishing UK as tourer finish

A Strategic Approach to Destination Marketing

Buhalis ( 1999 ) defines a finish as “ chiseled geographical countries, such as a state, an island or a town ” . Cooper et Al ( 1998 ) position finishs as the focal point of installations and services designed to run into the demands of tourers. Although UK has all the necessary installations that the assorted definitions are speaking about, there are unequal services designed to run into the demands of the tourer.

Riley ( 2012, sees selling as “ the across-the-board map that links the concern with client demands and wants in order to acquire the right merchandise to the right topographic point at the right clip ” . Diagrammatically, this is how he explains selling.

Overview of the selling procedure

( Adapted from tutor2u, Riley ( 2012 )

Using Ansoff Matrix for the Strategic Approach to Destination

Ansoff Matrix was propounded by a Russian-American, applied Mathematician and concern director called H. Igor Ansoff. The theoretical account was foremost published in the Harvard Business Review in 1957 ( & A ; Wikipedia ) .

Ansoff Matrix has grouped selling schemes into selling development, selling incursion, merchandise development and variegation. Diagrammatically, this is Ansoff clarify his theoretical account ( Ansoff Matrix ) ;

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Marketing Development: This theoretical account maintains that, to derive market for an bing merchandise, the company must be introduced into a new face of people. The touristry industry should aim different geographical markets either at place or abroad. It should acquire new market Centre for the bing merchandises and utilize different gross revenues channels to aim different groups of people. The industry can follow societal networking sites to do different among its rivals.

Market Penetration: To perforate agencies to enter-thus, market incursion involves with come ining a new market with an bing merchandises. Although it could be hazardous to come ining a new market with an bing material but, the industry can follow advertizement to promote people in UK to ship on domestic touristry.

Merchandise Development: Merchandise development has to make with developing new merchandises for an bing market. It is an opposite of market development. To use this, the touristry industry must widen their merchandises by traveling to new countries such as eco-tourism, health-tourism, sports-tourism, activity-tourism and instruction touristry every bit good as boxing the bing merchandises.

Diversification: Diversification is a signifier concern scheme that seeks to increase profitableness through gross revenues obtained from new markets and new merchandises ( Beginning: Wikipedia ) . In the application, the industry must utilize or acquire existing expertness to accomplish such scheme since it is the riskiest among the schemes.

Strategic Recommendations

To get the better of the challenges and maximise the benefits of the industry, the industry in coaction with UK Government should:

Adapt strategic believing so as to develop touristry with benefits for everyone.

Extinguish the revenue enhancement on touristry and do certain that there is no infliction of revenue enhancement on the tourers. The authorities should beg for financess from private endeavors to back up the touristry industry. This will guarantee easy entree to all tourers.

Reduce the tourer visa fee to vie with Schengen visa. Therefore the sum of money taken from tourers as they apply for tourer visa should be reduced to vie with the other competitory states.

Use the corporate administration scheme to maintain the industry accountable. This will assist to avoid any kinds of graft and corruptness in the touristry industry.

Have a touristry industry which provides low-cost quality, which is unfastened to all and which makes the best usage of Britain ‘s resources.


To sum up everything, Marshal ( 2012 ) opine that “ the challenges confronting the touristry industry are complex and legion. However, the two key among all the challenges are ;

Tax of adjustment and nutrient and

How to make a competitory, first touristry industry in Britain.

Honestly speech production, “ turn toing these challenges will necessitate a high degree of coordination and cooperation to marshal resources more efficaciously. Fiscal force per unit areas and viing precedences among all touristry spouses and touristry stakeholders will necessitate new and advanced partnership agreements to react to turning competition and planetary chances ( Marshal, 2012 ) ” .


It is the aim of the Ministry of Tourism and the Government of UK to make the environment where the industry would make non merely learn people to smile but give them a ground to smile. The Government should do it a point to do this ideal the bedrock of his new touristry policy ( beginning: Hon. Harold Lovel, 2012 ) .

Annotated Bibliography

Vision, mission, purposes and aims

In order for an organisation to hold clear strategic waies, it must foremost explicate clear vision, mission, purposes and aims. The undermentioned books were helpful in discoursing the intent of the vision, mission, purposes and aims ;

Dale, C. ( 2012 ) , “ Strategic Management for Tourism ”

Senior Lecturer in Tourism

University of Wolverhampton

Evans, N. C. D. and Stonehouse, G ( 2003 )

“ Strategic Management for Travel and Tourism ” . Oxford

Butterworth-Heinemann, 15-20

Understanding Strategic Position and Tourism

Scheme and Tourism have myriad of definitions from a different position. It is hence of import to open this study with a brief account on strategic placement and touristry. This will assist to ease better apprehension of scheme preparation and execution. The undermentioned books, diaries and articles were helpful in capturing the chief conceptualisation of scheme and touristry.

Capon, C. ( 2008 ) , “ Understanding Strategic Management ” ,

Prentice Hall: Hemel Hempstead.

Lovelock, C. H. ( 1984 ) . “ Services Selling ” .

Englewood Cliffs, NJ: Prentice-Hall.

Lovelock, C. H. ( 1991 ) . “ Services Selling ” . 2nd ed. , Prentice- Hall

Johnson, G. et Al. ( 2008 ) , “ Researching Corporate Strategy ” ,

Prentice Hall: Hemel Hempstead.

Porter, M.E. , ( 1980 ) ,

“ Competitive Scheme: Techniques for analyzing industries and rivals ”

New York: The Free Press

Tribe, J, ( 2010 ) , “ Scheme for Tourism ” , Goodfellow Publishers, Oxford

Overview of Tourism Industry in UK

In order to acquire wide and comprehensive reappraisal of touristry in UK, there was the demand to research into several books, diaries and articles which helpful to this study. As a affair of fact, the undermentioned books and diaries were able to give accurate information that the research worker was looking for.

Butler, R.W. ( 2011 ) : “ Contemporary Tourism Reappraisals: Tourism Life Cycle ”

Strathclyde Business School, Universiity of Strathclyde

Goodfellow Publishers Ltd. , Woodeaton, Oxford, OX3 9TJ


Shaw, S. ( 2012 ) : International Hospitality Management Program hypertext transfer protocol: //

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The Economic Importance of Tourism: UK Tourism Satellite.. , hypertext transfer protocol: // — -the-economic-importance-of-tourism/rep-2009tsa.html ( accessed December 12, 2012 ) .

Tribe, J. ( 2005 ) , “ The Economicss of Recreation, Leisure and Tourism ” , Butterworth Heinemann, Oxford.

UNWTO, EUROSTAT, OECD ( 2008 ) , “ Tourism Satellite Account: Recommended Methodological Framework ( TSA: RMF ) ” , Madrid, Luxembourg, Paris.

UNWTO, EUROSTAT, OECD ( 2008 ) , “ International Recommendations for Tourism Statistics 2008 ( IRTS 2008 ) ” , New York, Madrid. United Nations, Statistical Office of the European Communities, Organisation for Economic Co-operation and Development and World Tourism Organization ( 2008 ) .

VisitBritain Consultation Document ( 2012 )

“ Delivering A Aureate Bequest: A Grow Strategy for Inbound Tourism to Britain from 2012 to 2020 ” .


Key Issues and Challenges

This portion of the study is really sensitive to the research worker, hence there was the demand to acquire books which would give accurate information about the benefits and challenges facing the touristry industry in UK. The research made mention from the undermentioned books and web sites ;

BIS Economic Paper ( 2012 ) : “ Industrial Strategy: United kingdom Analysis ”

Department for Business Innovative & A ; Skills, No. 18

hypertext transfer protocol: //

“ Business Management and Strategies ” ,

hypertext transfer protocol: // ( accessed December 12, 2012 ) .

Marshall, C. ( 2012 ) , “ Challenges confronting the Tourism Industry in Antiqua & A ; Barbuda ” : Ministry of Tourism and Civil Aviation.

Office of National Statistics ( 2012 ) : “ The Economic Importance of Tourism: UK Tourism Satellite Account 2009 ”

VisitBritain Consultation Document ( 2012 )

“ Delivering A Aureate Bequest: A Grow Strategy for Inbound Tourism to Britain from 2012 to 2020 ” .


TOMORROW ‘S TOURISM – Home – Ask, common inquiries asked of… ( n.d. ) . Retrieved from hypertext transfer protocol: //

Strategic Options

This subdivision of the study focuses on the Marketing scheme and action program. There was the demand to acquire models and theoretical accounts to back up the work. The research worker hence made mention from the following books below, because these books give accurate accounts to the assorted strategic options and selling theoretical accounts ;

Buhalis, D. , 1999a, Limits of touristry development in peripheral finishs: jobs and challenges, Tourism Management, Vol.20 ( 2 ) , pp.183-185.

Cooper, C. et al. , ( 1998 ) , Tourism: Principles and Practices, 2nd erectile dysfunction, Addison Wesley Longman, England.

Digital Startup and Campaign Marketing station in Hyderabad.. , hypertext transfer protocol: // ( accessed December 12, 2012 ) .

Gallic Luxury Vacations, hypertext transfer protocol: // ( accessed December 12, 2012 ) .

William, J. ( 2002 ) : “ H. Igor Ansoff, 83 ; instruction drew world-wide acclamation ” – San Diego Union-Tribune. Retrieved ( 8/12/2012

hypertext transfer protocol: //

Beatty, C. et al. , ( June, 2010 ) : “ The Seaside Tourism Industry in England and Wales ” : Employment, Economic Output, Location and Trend. Centre for Regional Economic and Social Research

Sheffield Hallam University

Positioning the Destination Product – Bournemouth University..http: // an_Regional_Tourist_Boards_Learn_from_Private_Sector_Practice_ ( for_upload to_BURO ) .pdf ( accessed December 12, 2012 ) .

Porter M.E. ( 1996 ) , “ What is Strategy? “ | Reflections, hypertext transfer protocol: // / ( accessed December 12, 2012 ) .

Pima Community College: As with other impacts: Directories, hypertext transfer protocol: // % 20Impact % 20of % 20Tourism.htm ( accessed December 12, 2012 )

Tugberk ‘s Blog – TugberkUgurlu.Com,

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