YSC ARTICLE

SM,2008

Matta members’ scope of Business Activities

Although some Matta members are big tour operators, the local press often labels them as
tour agents. Many Matta members are also unable to clearly define their type of business activities.

Matta members are licensed under TOBTAB (Tour Operating Business & Travel Agency Business)
by the Ministry of Tourism. Their types of business are classified under four broad categories.

Travel Agency Business

These companies mainly act as agencies for airlines, hotels, cruise and tour operators by booking and
selling seats and rooms for these principals. Only the bigger agencies can issue tickets and vouchers.

Travel agencies also act as agents for corporate clients and charge a management fee rather than
rely on commissions paid by their principals. With the advent of zero commissions, retail customers
are now charged a service fee.

Many small travel agencies act as agents retailing tour packages for big tour operators
(wholesalers) and airlines that offer them to independent travelers.

Tour Operating Business

Many tour operators are involved in outbound and incentive tours. Some concentrate on
inbound and domestic tours. Organisations that handle both outbound and inbound tours
usually have separate divisions or companies to run these businesses.

The service required for inbound and domestic tours are similar. The difference is the market location.

Inbound Tour Operators depend mostly on overseas Outbound Tour Operators and airlines
flying into Malaysia for their business.

Domestic Tour Operators need to do their marketing in Malaysia and their customers are not
limited to Malaysians but include foreigners and expatriates already in the country.

Outbound Tour Operators target the same customers as Domestic Tour Operators but the tour
destination is different – outside the country.

Incentive Tour Operators also favour foreign destinations as their corporate customers have
staff/agents who find overseas trips more exotic.

Tour Vehicle Business

Tour buses share the same licence as tour vans under the Bas Persiaran (Excursion Bus) category.
Many big Inbound/Domestic Tour Operators have their own fleet of tour buses and vans.

Some tour bus/van operators are not directly involved in running inbound/domestic tours
and merely provide transport by supplying their vehicles.

Those Inbound/Domestic tour operators who rent out their bus licences to vehicle drivers to
operate on an owner/driver basis do so illegally.

Car rental companies rent out self-drive cars, vans and 4WDs to corporate customers and tourists.
As the Tourism Ministry permits these car rental companies to provide chauffeur-driven service
using the same vehicles licensed under Kereta Sewa Pandu (Hire & Drive), they no longer need to
apply for the Limousine Taxi licence from the Commercial Vehicle Licensing Board (LPKP).

MICE & Event Management Business

Meetings, Incentives, Conventions & Exhibitions (MICE) are big events that require lengthy
and meticulous planning. Some big Inbound Tour Operators take on the role of Professional
Conference Organisers (PCO).

Many event management companies not registered under TOBTAB depend on Matta members
to provide the necessary transfers and optional tours.

A growing area for enterprising travel and tour companies is the Malaysia My Second Home
(MM2H) programme. Similar to MICE and event management, MM2H is more lucrative than
the highly competitive travel agency and tour operating business.

YS Chan

Centre Manager, Matta School of Tourism