by

Railway Industry in France

TGV 1

1. Industry Overview:

In France, one of the most popular transport modes is train.  SNCF is France’s national railway, providing high speed, overnight and local services in France and beyond into Spain, Switzerland and Italy.

>> http://www.tgv-europe.com/en

Types of Train in France:

01-TGV

02-Lunea

03-Teoz

04-TER

06-Intercites

Railway industry is quite similar to airline industry, as it sells seats for a transport from an origin to a destination. The price depends on journey, class, and date of booking. Thus, railway industry can be placed in Quadrant 2, where its service has variable prices for a predictable duration. This industry also has the appropriate characteristics to apply revenue management strategies. Those characteristics are:

– Inflexible capacity: the number of seats on a train is fixed

– Variable and uncertain demand: the demand is different depending on the time of day, day of week, origin-destination pairs, and purpose of travel

– Perishable inventory: the unoccupied seat cannot be inventoried, and the revenue of that seat is missed

– Low marginal cost and high production cost

– Product can be sold in advance

– Heterogeneous customers with different segments, varying by age, purpose of travel, independent or group, etc.

However, there are some differences that make the revenue management of railway industry is little bit different than that of airline industry.

– More difficult to forecast demand and to have the accurate number of travelers on a service: no check-in procedure, open tickets (rail pass) generally allow passengers to travel on any rail service, walk up tickets are very common (a large number of passengers purchase their tickets on the day from the station)

– Less difficult to deal with overbooking: passengers are often allowed to stand during train journeys hence increasing capacity beyond the number of seats

———

 2. Space

Railway industry defines space implicitly.

Normally, a train has two classes: Economy (2nd Class) and Comfort (1st Class). The seating options and services are different for each class. The price is same for different seating options in a class.

 Economy Class:
01-Class2
 Comfort Class:

01-Class 1

Trains, especially TGV has “TGV bar”, which provides a wide selection of meals and sweet snacks available for purchase. Additionally, the TGV bar offers films on DVD, magazines, games for children, Paris Metro tickets, even USB sticks for purchase. There is also a rolling snack cart that comes to the customers’ seats.

01-TGV Bar

For additional revenue, TGV offers Premium service includes 1st Class seat, meal service, and access to the TGV lounge at the train stations.

Personally, I would charge difference fares for different seating options in each class. A group will want to pay more to have a Club 4 seat. A couple will want the Duo seat or Club 2 seat. And an individual traveler will want a solo seat. As the number of seat are fixed, we can charge for each option, rather than a “first comes first served” policy.

I’m also thinking about a mini-cinema on train, especially overnight train. Normally, the overnight train have load factor less than 80%, so the train can use one car to transform into a mini-cinema with a projector and a screen. When the train is busy, the car will be transformed in normal guest car again.

——

3. Time

Railway industry defines time implicitly.

Although the duration of a journey is determined, the railway industry sells a journey rather than specifically selling time. In addition, there may be issues that cause the increase/decrease in duration of the journey.

However, the railway industry also tries to sell time explicitly with the Rail pass. With Rail pass, customers can have unlimited travel on the national rail network of France for a fixed number of days. The choices are 3, 4, 5, 6, 7, 8 or 9-day pass within a one-month period. Travel days may be used consecutively or non-consecutively.  Thus, the fare becomes rate-per-day, not anymore rate-per-trip.

>> http://www.raileurope.com/rail-tickets-passes/france-pass/index.html

The industry can sell time explicitly by providing Rail pass with weekly or monthly unit. However, I think it will not be effective as it makes the demand forecasting much more complicated.  Half-day unit won’t make sense as a trip is normally more than 3 hours.

——–

4. Price

Tickets can be purchased 60 to 120 days in advance depending on the route.

Ticket discounts are based on advance purchase, availability, and certain restrictions. Everyone is eligible to receive discounted fares by purchasing an Economy or Comfort class ticket in advance. Youth and seniors can enjoy specific discounts as well. Discounted tickets are available for youth (under 26 of age), seniors (age 60 and over) and children (generally ages 4-11) but should be verified with each product.

Price at 1 week before departure
01-Price-1st class-10AM-1wk

Price at 2 weeks before departure

01-Price-1st class-10AM-2wk

Price at 3 weeks before departure

01-Price-1st class-10AM-3wk

Price at 4 weeks before departure

01-Price-1st class-10AM-4wk

Normally, prices are reduced for 1or 2 week-advanced purchase, slightly reduced for 3-week-advanced purchased, and stay same for more-than-4-week-advanced purchase.

The physical rate fences are the classes:
01-Booking-Class

 

The non-physical rate fences are age, season ticket, and loyalty

01-Booking-Rate Fences-1

01-Booking-Rate Fences-2

01-Booking-Rate Fences-3

01-Booking-Rate Fences-4

As the rate fences are now already too sophisticated, I would rather consolidate these fences than create new fences to confuse customers.

 

(-Thao Ly)

——–

References:

http://www.raileurope.com

http://www.tgv-europe.com

http://www.sncf.co.uk/

Amstrong and Messneir, 2010. Railway revenue management: Overview and Methods

Schroeder, Braun, and Schnieder. Revenue management in the railway industry

 

207,076 thoughts on “Railway Industry in France”

  1. มั่นคงปลอดภัย เชื่อถือได้ จ่ายจริง หาเงินง่ายๆ เว็บตรง ไม่ผ่านเอเย่น ฝากถอนไม่มีขั้นต่ำ ทำรายการได้ตลอด 24ชม. แอดมินคอยดูแลเป็นอย่างดี

  5. This is a decent post. This post gives really quality data. I’m unquestionably going to investigate it. Truly exceptionally valuable tips are given here. Much obliged to you to such an extent. Keep up the acts of kindness. Workshop Manuals

  8. Thanks for all your valuable labor on this website. Gloria delights in getting into investigations and it’s obvious why. Most people hear all concerning the dynamic method you present powerful guidelines on this website and as well boost response from other individuals on the subject matter so our own daughter is truly studying a lot of things. Take pleasure in the remaining portion of the new year. You’re the one carrying out a splendid job. 먹튀파인드

  10. Hello! I’ve been following your blog for a while now and finally got the courage to go ahead and give you a shout out from Kingwood Texas! Just wanted to mention keep up the good work! 먹튀파인드

  12. My own enterprise is normally doing a search online designed for storys which could offer every person. There could be absolutely some type of several to discover using this. My partner and i locate me personally folks made many salubrious information together with Features furthermore. Detain topsy-turvy, outstanding vocation! see page

  13. You make a lot of wonderful factors here that I study your short article a couple of periods. Your sights are in accordance with my own for the most part. This is excellent content material for your personal visitors. สล็อต 999

  14. We have market some merchandise of different tailor made boxes.it is vitally valuable and very reduced price tag make sure you visits This page many thanks and be sure to share this post with your mates.สล็อต 999

  17. I genuinely believed you would probably have something useful to say. All I hear is a bunch of whining about something that you can fix if you were not too busy looking for attention. After all, I know it was my choice to read.. econ 補習邊個好

  18. Mmm.. good to be here in your article or post, whatever, I think I should also work hard for my own website like I see some good and updated working in your site. 補習社系統

  20. Very cozy looking rooms. Let me know if your going to Mexico. Oh and btw. you should read our Tipping in Mexico guide if you do. It will save you a lot of awkward moments. 補習社系統

  21. I’m gonna evaluate this. I’ll make sure you come back. lots of thanks for sharing. and Also This article presents The sunshine by which we could observe the fact. this is very wonderful one and offers indepth สล็อตpgเว็บตรง details and information. many thanks for this fantastic putting up…

  26. Cumpara telefon HUAWEI nova 10 Pro din HUAWEI Store Romania cu livrare gratuita si rapida 8GB 256GB, camera frontala 60MP, design ultra subtire, SuperCharge 100W Plata in rate fara dobanda sau plata ramburs fara taxekjhjgytre
    huawei nova10 pro

  27. I’m continually scanning on the web for posts that will support me. An excess of is obviously to find out about this. I trust you made great quality things in Functions too. Continue working, congratulations! 課室管理系統

  29. Impressive web site, Distinguished feedback that I can tackle. I am moving forward and may apply to my current job as a pet sitter, which is very enjoyable, but I need to additional expand. Regards 英文LV3

  31. I wish to convey my gratitude for your kind-heartedness giving support to men and women who actually need help on this one subject matter. Your very own commitment to getting the solution around became really functional and has continuously empowered guys and women just like me to get to their goals. Your entire warm and friendly recommendations signifies this much a person like me and especially to my office workers. Many thanks; from each one of us. linen chute closer

  40. Pretty nice post. I just stumbled upon your weblog and wanted to say that I have really enjoyed browsing your blog posts. After all I’ll be subscribing to your feed and I hope you write again soon! seo推廣

  41. I think this is an informative post and it is very beneficial and knowledgeable. Therefore, I would like to thank you for the endeavors that you have made in writing this article. All the content is absolutely well-researched. Thanks… seo推廣

  50. I’m impressed, I have to admit. Actually rarely do you encounter a weblog that’s both educative and entertaining, and let me tell you, you’ve got hit the nail to the head. Your thought is outstanding; the catch is something inadequate individuals are speaking intelligently about. We are happy i always found this during my search for some thing relating to this. สล็อต

Leave a Reply

Your email address will not be published. Required fields are marked *