Packaging involves combining a number of component products to form a package, which can be on-sold to the trade and consumers. Before you develop a package it is important to determine the target market(s) for the package and what may appeal to them.

A package normally involves compatible products, such as accommodation, transport, entry to attractions, meals and touring.

For example, you may be an accommodation supplier who wishes to encourage visitors to visit your area and stay one or perhaps two nights. Your package may include entrance to local attractions, a local tour, a meal at a local restaurant and suggestions as to what a visitor can do and see in your area.

Packages can make it more appealing for travel agents and tour wholesalers to take up your product, particularly if you are a single attraction or accommodation with a small number of rooms.

A central booking number for the package makes it attractive for the travel industry, as it only means one call to secure all elements of the package.

Packages can also assist in driving business to your product during low seasons or off peak times. Attractive pricing can drive consumers to book packages at these times.

Packages can help develop new markets by offering products that appeal to a new market segment.

When developing a package you will need to factor in administration costs if you are looking after the administration of the entire package. This will include those elements not provided by you, for example entrance to attractions, tours, meals etc.

Commissions 

Packages make it easier for agents and wholesalers to sell them and earn commission. Packages distributed through the travel trade will need to be fully commissionable. The cost of covering commissions on top of operating costs may seem daunting to some operators. However, it is important to remember that you only pay a commission on those bookings actually made through the wholesaler or travel agent.