A tour operator typically combines tour and travel components to create a holiday. The most common example of a tour operator's product would be a flight on a charter airline plus a transfer from the airport to a hotel and the services of a local representative, all for one price. Niche tour operators may specialise in destinations e.g. Italy, activities and experiences e.g. skiing, or a combination thereof. The original raison d'etre of tour operating was the difficulty of making arrangements in far-flung places, with problems of language, currency and communication. The advent of the internet has led to a rapid increase in self-packaging of holidays. However, tour operators still have their competence in arranging tours for those who do not have time to do DIY holidays, and specialize in large group events and meetings such as conferences or seminars. Also, tour operators still exercise contracting power with suppliers (airlines, hotels, other land arrangements, cruises, etc.) and influence over other entities (tourism boards and other government authorities) in order to create packages and special departures for destinations otherwise difficult and expensive to visit.

The two major tour operator associations in the US are the National Tour Association (NTA) and the United States Tour Operator's Association (USTOA), in Europe it is the European Tour Operators Association - ETOA and in the UK it is ABTA and AITO . The primary association for receptive North American inbound tour operators is the Receptive Services Association of America (RSAA).