Question

Why will the number of suppliers in the tourism industry decrease, and how will this consolidation of suppliers take place?

Answer 1

The number of suppliers, in tourism industry, will decrease due to higher cost of operations, diversified demand by the consumers and smaller network of these suppliers unable to cater the demand of the industry. It makes suppliers to decrease as they are unable to cater with higher efficiency in the market of tourism industry. It will makes suppliers to consolidate, because each supplier has its own core network and when multiple suppliers combine, then a big network is developed with lower cost and higher efficiency. It now makes every participating  suppliers to get their own share of profit. Hence, it is the mutual benefit of all the suppliers to come together and consolidate so that a wide network of services in different markets, with supplies related to hospitality, logistics movement and other allied services are well covered. So, supplier will come up together to complement each other.