Categorizing Travel Agencies in China Using Retail Sales as the Analysis Unit

Chinese travel agencies can be classified into two types: international travel agencies and domestic travel agencies.International travel agencies concern outbound tourism,inbound tourism,and domestic tourism,and domestic travel agencies only operate domestic tourism activities.In 2009,China's tourism administration abolished the classification of international and domestic travel agencies as per the new Regulations of Travel Agency;there are no longer any formal classifications.However,the industry and academic researchers still require such definitions to clearly identify the boundaries and operating scope of travel agencies.Regarding the classification of travel agencies,tourism academics usually consider that the industry accommodates a vertical division work system,along with the development of the tourism market and information technology in line with the experiences of Europe and the United States.The vertical division work system means that travel agencies can be divided into three categories: tour operators,wholesalers,and retailers.To better understand the operating conditions of the industry and to find a suitable way to categorize modern travel agencies in China,this study adopted qualitative research methods based on the grounded theory.This included in-depth interviews with 35 owners or senior managers of China-based conventional travel agencies in Guangdong and Jiangxi provinces from April 2011 to November 2012.Guangdong and Jiangxi provinces were chosen as appropriate research areas for a number of reasons: 1) the travel agencies in those two provinces represent the two extremes of industry development in China;2) the different functions of the travel agencies in those two provinces represent the different kinds of travel agencies in China;3) and the authors had good research accessibility in those provinces and were able to interview a sufficient number of owners and senior managers.This study sorted out 36 million Chinese words from the interview transcripts;these were analyzed using NVivo7.0 as a research tool.The analysis unit of this study is the smaller sector retail sales of travel agencies rather than the travel agency itself.Thus,this research differs from most travel agency research.The present study identified four core elements(alliance,finance,product,and customer) from the interviews to construct AFPC categorization and found 16 different types of retail sales within travel agencies.Support samples were identified from the cases as per AFPC categorization.Furthermore,travel agencies were categorized into six types based on different features and combinations of their retail sales: regular chain(direct) mode,join-in mode,traditional mode,contracting mode,mixed mode,and single mode.Support samples were found in the industry for the first five modes.Single Mode sample were not identified or it did exist but the administration does not define the single mode enterprise as a travel agency.The overall results show that with the growth of the tourism market and the rapid progress of information technology,travel agencies in China have formed a "T-shape division work system," which embodies a vertical division of operators,wholesalers,and retailers among retail sales;however,a horizontal division in the production of identical or similar products remains among travel agencies.