INDUSTRY ANALYSIS

The tourism sector is one of the rising sectors of Pakistan. Overall, the travelling and leisure
industry is composed of four main subdivisions: entertainment, recreation, tourism, and travel.
The industry has faced rapid growth since the past couple of years. The reason for this
development is mainly the charm of northern areas and the increased trend of hiking and
trekking. The rising need of people to have daring and adventurous tours and to fulfil these needs
they want a safety and quality assured travelling and tourism company. We’ll serve this segment
of the industry. Though this sector of the industry is getting flooded overtime but there appears
to be some vacant and untapped spaces that have not been marked yet so the growth
opportunities are great in this segment. The usual focus of the competitors are universities,
corporate world and general public while we would be focusing on educational institutes that are
situated in developing areas of Islamabad and Pakistan. Generally, these institutes don’t have
these kind of facilities to cater their students, so we would be exploiting this opportunity unlike
our competitors.
Moreover, we’ll differentiate our services and adding value in them by introducing a unique
program of “Customer Relationship Management”. Hence, this industry is a realistic place to
enter. There are two types of factors affecting industry’s performance.

Internal Factors
We consider our services and our packages as the most valuable asset of the company and that is
why we aim to choose to offer those tour packages that have the potential to be sold and gain
potential customer’s attention. In our business scenario, customer experience and customer
services will be the primary thing that is going to interact with the customer. As we want our
customers to be satisfied and hence make them loyal by retaining them. We have to come up
with excellent packages and services to gain competitive advantage. The culture of our
organization will be decentralized and each member would be involved in the decision making
process. And also we believe in the concept of team work and integrity.

External Factors
These factors are more critical to the overall performance of any industry.
Business Trends
As mentioned earlier, this industry is developed and an emerged industry so it’s not very difficult
to make profits. But, profit margins are increasing as businesses are trying to bring in innovation
into their services. In addition, the input costs are not very high as the businesses are outsourcing
lot of things, so their cost of doing business is low. And when it comes to selling it, they sell at
high prices depending upon the key advantages they have like location advantage, extraordinary
services, services quality, reliability of the tour operators etc.
Industry rivalry
Industry rivalry is very high as it is a developing industry and entry barriers are very low. This
means in upcoming years, competition will be enhanced further. Direct rivalry exists e.g. “Sair
Sapatta”, Pickro, “Musafir”, “IbneBatoota Adventure”, “TripShrip” are our main rivals.
Degree of differentiation between services
This is the part where we will have opportunity and will perform well by bringing innovation in
our services and differentiating ourselves from others. In this case again, we can take a first
mover advantage by offering our tour packages to specific niche market of educational institutes.
Growth rate of an industry
The growth rate of this industry is not very fast as this is an emerging industry and it has been
already discussed that many players are currently operating in this particular domain. Still there
is a big room for innovation. Tourism Ministry of Pakistan along with Tourism Development of
Pakistan (TDCP) has started working vigorously for the development of this sector which will
further increase the agility of this sector.
Tourists exports are the key Visitor exports are the key ingredients of the direct contribution of Travel
& Tourism. Back in 2016, Pakistan earned PKR 93.8 billion in tourist exports. In 2017, this was
expected to grow up to 3.1%, and the country was expected to appeal 1,179,000 international tourist
arrivals. By 2027, global tourist arrivals are estimated more than 2 million which would generate
around PKR 204 billion with an increase of 7.7% per annum (Emerging Pakistan Tourism, 2019).

Threat of substitutes
Threat of substitutes is low as most people now prefer to take a recreational tour with tour
operators rather than doing it on their own. Families want low budget trip which can be possible
only if they take these services from tour operating companies.
Bargaining power of buyer
In our industry, there are many competitors offering the same or even lower prices which
increase the likelihood of customers to use their services. This factor also increases the buyers
bargaining power. Thereby, a very well thought strategy will be required to bring a maximum
number of people on our page.
Bargaining power of suppliers
The bargaining power of the supplier is high because quality transporters are very low in
numbers. Moreover, due to number of competitors, buyers try to play monopoly sometimes by
charging the rates of their own will. In tourism industry, suppliers/vendors are transporters,
accommodation providers, and restaurants. The latter two have less bargaining power as the
several alternate options are available.

NON-TRADITIONAL BARRIERS TO ENTRY

Following are the barriers that we can create for any potential entrant.
Strength of management team
We will build a dedicated and hard-working management team which has a passion for doing
business and we believe in the concept of team work and integrity. Moreover, decision making
process is decentralized in our organization. In this way, we will create a barrier to entry.
Unique business model
Our business model will be a simple one which makes it unique and different from the business
models of other companies who offers many services to general public and corporate sector. On
the other hand, we’ll be offering services to education sector and it has a huge scope. Targeting
schools and academies will provide a constant cash flows to business. Since, we are early birds
with this business approach, we will try to capture the market as much as we can to make our
customers more loyal before someone else enters to capture them.
Inventing a new approach in industry
The way we will do our business and implement our business practices will be a new approach
for working in this industry. Like, we believe our management team to be the most valuable
asset. Thus, this will obviously give birth to a new approach of doing business in this particular
industry by doing something new that is not being done by other pages.

PESTEL ANALYSIS
Political
Government Interest
Tourism blooms in a state where government supports it. Current government of Pakistan is
taking a keen interest in promoting tourism of the state. The main reason of government interest
in encouraging tourism is the investment which this sector will bring to the country. Government
is itself participating in urging people to visit domestic tourist attractions of Pakistan which is
acting as a major opportunity for tourism companies to operate in the country.
Government Policies
Since last 10 years in the history of Pakistan tourism sector in Pakistan had been vastly ignored
due to previous government’s inadequate policies to attract domestic and international tourists.
New government of Pakistan Tehreek-e-Insaaf is working hard to devise new policies to revive
the tourism in the state. Government is spending billions in redeveloping the infrastructure and
tourism promotion. For that purpose, government is developing tourism centers in different areas
that will provide support and monitor the tourism activates in the areas. Government has also
handed over the administration of public rest houses to the private sector to encourage people to
enter into this business. Moreover, government has also eased the visa restrictions for visitors
from 55 countries to open up this sector not only for domestic but also for international tourists.
Role of Tourism Ministry
Mr. Atif Khan, current minister of tourism ensured that the potential of tourism in the country
will be fully explored. The ministry is striving hard to regulate the tourism industry. It has
established a Special Task Force whose main purpose is to work on rehabilitation of the tourist
spots and to identify the new places.
Political Turmoil
Pakistan is a country with very fragile political conditions. Here the political unrest is norm of
the day, which not only is adversely affecting the travel and tourism industry but also the whole
economy. The main target of the tourism firms tends to be the people having intention to explore
the miracles of their very own land. Its serves to be one of the major profitable industry in
Pakistan. Government serves to be a major entity regulating firms under this umbrella, so
political changes have a direct impact on this industry.
Economical
Economic growth
Economic factors are of great significance behind the high demand of tourism sector around the
globe. The improvement in the disposable income of people serves to be a milestone in uplifting
this industry. Investment in tourism will improve the overall economy of the country and
according to the statistics it’s estimated that that by the year 2025 tourism will contribute Rs1
trillion to Pakistan’s economy. Moreover, projects like CPEC will improve the economic
conditions of the company and will also encourage the tourists to spend money. Improved
economic conditions will make people capable to raise their leisure spending which ultimately
raise the potential for businesses of tourism companies.
Social
Heritage and Culture
Pakistan’s beauty lies in its culture and heritage. These two factors play important role in
promoting tourism of the state. Pakistan is famous for the hospitality and its unique culture
which influence the tourists all over the world to explore the country. Pakistani social system,
which is not acting a major force impeding the progress of tour industry but also pressing the
motivation of people to travel and explore their very own land.
Safety emphasis
One of the major concern for a tourism company is to handle the safety and security issues.
People are hesitant to travel through tourism companies because of the security issues which
involve concerns for the suitable drivers, transport, accommodation, any illegal activity etc. For a
company like Rahgeer, security should be the utmost priority to ensure a safe travel experience
for the customers
Role of Mass Media
Mass media is playing a major role in promoting the beauty of Pakistan. Moreover, government
is also using mediums such as print and electronic media to promote tourism and spread
awareness among people.
Technological
Social Media
Increased trend of social media has paved a new path for the tourism industry. It is paving the
way for the progress of this industry, by enabling participating firms to achieve the operational
excellence along with better experience provision to the intending ones. Modern technology has
made the firms capable to better remain integrated to their customers. Like Pakistani tour firms
are facilitating their customers to have online booking and other related stuff. Social media and
mobile technology has fueled the growth of Pakistani tourism industry by facilitating mobile
bookings, messages, check-ins etc.
Bloggers and Vloggers
Increased social media trend has led to new ways of information and experience sharing in the
form of blogging and Vlogging. This trend is playing a vital role in promotion of tourism in the
country and is spreading positive image about the country. The Tourism Minister of KPK, Mr.
Atif Khan has been promoting foreign vloggers like Eva Zu Beck, Trevor James, Rosie
Gabrielle, Mark Wiens etc. to present the soft image of Pakistan through their vlogs.
Websites and App
These technological platforms are providing new ways to market and promote the tourism
companies in the country and are making things easy for the customers such as e-booking,
check-ins, information availability etc.
Legal
Unnecessary challans and Excess of Tool Taxes
The legal pressures accompanied with other challenges serves to be a bottleneck in the
operations of tour firms. One of the major issue is unnecessary challans and excess of tool taxes
which increase the overall budget of the travel trips that ultimately serves as a burden on
customers.
Company Registration Laws
Tourism companies have to comply with several legal regulations in order to get registered. An
important one is obtaining No Objection Certificate (NOC) which allows the legal registration
and permit of the operations of the company. However, it’s not easy to obtain NOC and company
has to meet several legal requirements.
Environmental
Weather
The environment; especially weather conditions, have a huge impact on the operations of the
tour companies. They are the major effected ones from the changing environmental patterns.
Their operations also tend to get effected from changing seasons; like they cannot execute their
operations in stormy and extreme weathers. Their demand and supply also experiences a great
number effect because of seasonal variations. So in order to better overcome this factor they
should better take consultancy and other environment related expertise from external experts
prior to planning for any journey, especially Pakistan is the major effected country from the
aftermaths of global warming, so here, in future, the abnormal weather patterns may become
order of the day.
Lack of Facilities:
Though government is taking initiatives, but still many tourism spots in Pakistan are having very
limited facilities which serves as major hurdle in the scope of operations of tourism companies.
Many areas have lack of infrastructure such as bad roads, no gas or electricity, network problems
and similar issues which limit the activities of tourism operations of companies.