INTRODUCTION
Welcome to the resource SITTTSL304, Prepare Quotations.
This resource describes a key sales and operational function for a diverse range of domestic and international tourism and hospitality products and services and applies to the full range of industry sectors. The tourism or hospitality organisation could be a principal (the supplier) or an agent quoting on products and services on behalf of the principal.
The unit has particular application to those personnel who sell as a key focus of their job role. It applies to frontline sales or operations personnel who operate with some level of autonomy or under limited supervision and guidance from others. It is undertaken by a diverse range of people such as retail travel consultants, corporate consultants, inbound tour coordinators, visitor information officers, account managers for professional conference organisers, event coordinators, tour guides, restaurant managers, banquet coordinators or managers, resort activities coordinators, tour desk officers, reservations sales agents and owner–operators of small tourism businesses.
Resource overview
SITTTSL304, Prepare Quotations describes the performance outcomes, skills and knowledge required to calculate the costs of products and services accurately and to present quotations to customers. It requires the ability to provide quotations for products and services where some costing and pricing has already been undertaken in the product development phase.
Required skills and knowledge
The following skills are required to complete this unit:
· communication skills to discuss supplier costs and negotiate a rate
· literacy skills to:
- read and interpret documents such as customer files, customer requests and complex product costing information
- write records of customer details and requests, complex quotations and all quotation options in a clear format and style including accurate details of conditions and limitations specifically applicable to the quotation
· numeracy skills to:
- interpret complex product and costing information and calculate complex costs for all products
- interpret and calculate commissions or mark-ups
- interpret and calculate any sales and product coordination fees
- calculate any currency conversions
- calculate the final customer cost
· planning and organising skills to prepare quotations in correct customer file sequence according to the earliest service dates for customers
· problem-solving skills to identify and resolve mistakes in calculations.
The following knowledge is required to complete this unit:
· for the specific industry sector and organisation:
- quotation systems and procedures
- features of products sold
- sources of costs for products, services and fees
- sources of negotiated cost of supply, contractual arrangements and preferred supplier arrangements
- commission and mark up rates and procedures
- formats for and inclusions of quotations presented to customers
· the primary components of consumer protection laws that relate to the provision of quotations including organisational responsibility for:
- nominating and charging cancellation fees
- providing information on potential price increases
- providing refunds
- supplying products as described or substituting suitable products when unable.
Evidence of the ability to:
· prepare multiple quotations covering a diverse range of tourism, hospitality or event products and services to meet the different requirements of customers
· integrate knowledge of commissions, mark-ups and fees into quotation activities
· demonstrate knowledge of the primary components of consumer protection laws and actions that must be adhered to by organisations
complete quotations within commercial time constraints and deadlines determined by the customer and the organisation.
Required elements and performance criteria
Elements | Performance Criteria |
1. Calculate costs of products and services. | 1.1 Create records to administer customer details and requirements. |
1.2 Source, select and interpret product and costing information to prepare the quotation. | |
1.3 Source, select and interpret product and costing information to prepare the quotation. | |
1.4 Calculate commissions or mark up net costs according to organisational procedures to determine a profitable selling price. | |
1.5 Accurately calculate any additional taxes, special fees and other charges. | |
1.6 Accurately calculate any required currency conversions. | |
1.7 Calculate final cost of the product or service package or itinerary. | |
1.8 Check product or service package or itinerary calculation against all individual product and service components | |
1.9 Keep detailed records of the method of calculation, according to organisational formats. | |
2. Provide quotations to customer. | 2.1 Prepare the quotation to reflect all required customer inclusions. |
2.2 Promptly provide quotation to the customer according to organisational procedures and formats. | |
2.3 Offer secondary quotations with options, as appropriate. | |
2.4 Include accurate details of the cost of product and service provision and the conditions and limitations of the quotation. | |
2.5 Record all details of the quotation accurately and file according to organisational procedures. | |
2.6 Minimise use of printed materials and maximise electronic transmission and record keeping to reduce waste. | |
3. Update and amend quotations. | 3.1 Adjust and update quotations to take account of changed requests or arrangements |
3.2 Provide the most up to date quotation to customers inclusive of new conditions and limitations. | |
3.3 Record all details of adjusted quotations and file. |
Suggested learning resources
· Local tour operators’ documents
· Brochures featuring local tours, accommodation, meals
· Costing sheets
· Foreign exchange rates
· Examples of supplier contracts, tariff sheets, and fare schedules may be shown by your learning facilitator
· Access to spreadsheets will assist you in preparing quotations
Text:
Howard, J and Harris, R (2002) (3rd Ed) The Australian Travel Agency, McGraw Hill, Sydney.
Glossary of terms used in this module
Word or Term | Meaning |
Agent’s Commission | Usually a percentage taken OFF the selling price and kept by the agent. This is how the agent makes their profit. |
BBR – Bank Buying Rate | The rate the bank buys foreign currency e.g. when you convert foreign currency to local currency you use this rate. |
BSR – Bank Selling Rate | The rate the bank sells foreign currency e.g. when you convert local currency to foreign currency you use this rate. |
Business Events | Business Events sector formerly known as the MICE sector |
Child | Usually over 2 years old and under 12 years old for international travel. Some exceptions may apply e.g. air travel within Australia a child is between 3 & 15 years. |
Client | The company/person for whom the retail travel agent is preparing the quote. |
Conditions of Sale | The conditions on which the quote is based. Payment requirements, cancellation policy, min/max numbers, legal agreements. These are the rules of the contract |
Consolidator | Company which negotiates net/net rates with a variety of airlines and on sells them to travel agents, tour wholesalers at net rates. The volume they generate means consolidators’ airfares are often very attractive. |
Contract Rates | Rates negotiated between the tour wholesaler and the supplier. |
Exclusions | All components not included in the quote e.g. meals, excess baggage charges, entrance fees. |
Extra bed | A price is often charged to bring an extra bed (usually a rollaway bed) into a hotel room. |
FIT – Fully Independent Traveller | Traveller who is not part of a group tour. They may be doing their ‘own thing’, but use contract rates. Often used for travel to Pacific Islands, car-hire tour of Europe, U.S.A. etc. |
FOC – Free of Charge | A client who does not pay for their travel arrangements, but who receives them free of charge. You may need to negotiate FOC travel arrangements with principals. Usually reserved for VIP clients, corporate clients or tour leaders. |
Foreign Currency | The currency of another country outside the country of the tour. |
Gross Price | The price including mark up and commission. Same as selling price. |
Group | A group of travellers who are following the same itinerary at the same time. |
Inclusions | All components that are included in the quotation e.g. transport, sightseeing, accommodation. |
Infant | Usually under 2 years. For air travel within Australia it is under 3 years. |
Local Currency | The currency of the country to which the client is travelling. e.g. if you are travelling in France the local currency is Francs, while in Japan it is Yen. |
Mark Up | An amount or percentage ADDED to the net price charged by the principals. It is the profit retained by the Tour Wholesaler. |
Maximum Numbers | Maximum number of passengers allowed on a tour. This may be the capacity of the coach or other capacity restrictions. |
Maximum Stay | Maximum amount of time allowed to stay at a destination. Often a rule for promotional airfares. |
Minimum Numbers | Minimum number of passengers required to allow the tour to operate at a given price. |
Minimum Stay | Minimum amount of time required to stay at a destination. Often a rule of promotional airfares. |
Net Price | The price paid to the Tour Wholesaler or Tour Operator by the retail travel agent for the travel arrangements. The net price has the retail travel agent’s commission deducted from it at point of sale by the retail travel agent. |
Net/Net Price | The price paid by the Tour Wholesaler or Tour Operator to the principal (supplier) for the tour components. This is the actual cost of the travel arrangements. |
Optional Tours | Additional tours that the passenger can take once they arrive at a destination. These are arranged on the spot and passengers pay an additional price. They are not included or compulsory. They often enhance the experiences and memories of the package tour. |
Override Commission | Extra commission paid to a retail travel agent or tour wholesaler based on additional sales volume. This is like a bonus payment for increased sales. |
Per Person | Price for each person on the package tour. Price for each person staying in the one room. |
Per Room | Price for a room. A room can be single, twin, double, triple, quad or family room. Cost is divided by the number of occupants to get a per person rate. Often there is a per room rate for 1-2 occupants, after which an extra bed rate is charged. |
Porterage | Charges incurred for carrying bags at airports and hotels. |
Preferred Agent | Retail Travel Agent who sells large volumes of a particular product and receives override commission. A preferred agent is usually a company, not the consultant. |
Principal | Owner of the service or tour component e.g. airline, coach company, hotel. |
ROE - Rate of Exchange | The rate provided by the bank to convert foreign currency into local currency. There is a selling rate and a buying rate.
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Selling Price | The price paid by the passenger/client. Usually the price printed in the brochure. Also called the ‘Brochure Price’. Includes retail commission. |
Single Supplement | Additional amount paid by the client for single occupancy of a room. |
Taxes | Charges imposed by governments. These must be included in tour quote and can be significant amounts. Often based on a percentage amount. e.g. Room Rate + 5% tax |
Tips | Additional amount paid for service, usually paid to porters, waiters or other similar service providers |
Tour Leader | A person who leads a group of people of common interest on a tour. They don’t usually manage day-to-day operation of the group, but are a member of the group. |
Tour Manager | Person escorting the passengers throughout the tour. Also known as, tour escort or tour guide. Manages all aspects of the tour. |
Tour Operator | Company which operates tours and other ground arrangements on behalf of tour wholesaler. Often a principal. Tour operators are inbound (within own country) or outbound (outside own country). |
Tour Wholesaler | Company, which combines different services into a tour and on, sells this product to travel agents. They produce brochures to promote their tour products. |
Transfers | Direct travel between two locations. Usually between airports and hotels; wharves and hotels; hotels and hotels. |
Triple Reduction | Discounts may apply if three people sharing a room together using existing bedding. |
Twin Share | Rate for two people sharing a room. They may or may not be travelling together. |
Validity | The period for which the quote is applicable. |
