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

 

206,795 thoughts on “Railway Industry in France”

  1. Cryptocurrency holders will benefit from Trezor hardware wallets. A secure storage system prevents a hardware wallet from being broken. Trezor is the better option if you want to keep your coins securely. Customer support is one of the major benefits of using Trezor for trading. You can contact Trezor Wallet Customer Service to resolve the hardware wallet issue.

  6. There are incredibly lots of details that adheres to that take into consideration. That is a fantastic denote raise up. I provde the thoughts above as general inspiration but clearly you will find questions like the one you raise up the place that the most crucial factor will likely be working in honest good faith. I don?t determine if guidelines have emerged about things such as that, but I know that a job is clearly recognized as a good game. Both youngsters glance at the impact of a little moment’s pleasure, through out their lives. 마마카지노

  8. Countless online communities include singles organizations of which attempt enjoyment boca raton breast lift pursuits mutually, and this also is actually wonderful substitute adult dating technique. Activities for instance pedaling, bowling, curling, motion picture a short time, dance and also humor golf equipment are sorted because of the singles party, but it lets an evenly-distributed group of contributors to acquire an exciting along with unconventional night time. By using concentration don that exercise once more rather then building a amorous association, it will take a lot of strain over singles as well as attractions manifest far more normally inside this type of setting up. rtg slot

  10. Nice post. I understand some thing very complicated on various blogs everyday. It will always be stimulating to study content off their writers and rehearse something from their website. I’d opt to apply certain while using content on my small blog whether you don’t mind. Natually I’ll provide a link with your internet blog. Thanks for sharing. situs rtg slot

  11. To be more specific, Vidalista 80mg is a tablet that belongs to the Tadalafil family of PDE-5 hormone suppressing medications. You may get erect and be supported for a considerable amount of time by ingesting Vidalista 80 mg, which is regarded as an extraordinarily high dosage.

  12. A medication called Cenforce 200mg is suggested for the treatment of impotence or erectile dysfunction (ED). The medication is also most effective for men who experience erection disorders for any reason. Additionally, it is only appropriate for men between the ages of 18 and 65, and not for anyone else.

  13. It is the best time to make some plans for the future and it is time to be happy. I’ve read this post and if I could I want to suggest you some interesting things or suggestions. Maybe you could write next articles referring to this article. I wish to read more things about it! situs rtg slot

  21. I as shown by an overall perspective need to uncover to you that I am new to weblog and especially favored this blog page. Strong I’m going to bookmark your blog . You totally have amazing stories. Pulls for obliging us your blog. كورة لايف

  24. Positive site, where did u come up with the information on this posting?I have read a few of the articles on your website now, and I really like your style. Thanks a million and please keep up the effective work. hotmail

  25. Veger offer wide range of wireless magsafe power banks with various capacities from 5000mah to 10000mah compatible with all latest model of Iphones and wireless compatible Android Smartphones. wireless power bank

  27. I needed a lot of the studies, Desire definitely preferred, We’d like addiitional facts regarding it, the way it is usually somewhat fantastic., Cya just by revealing. situs judi slot

  28. Positive site, where did u come up with the information on this posting? I’m pleased I discovered it though, ill be checking back soon to find out what additional posts you include. Slot Deposit pulsa

  31. I was surfing the Internet for information and came across your blog. I am impressed by the information you have on this blog. It shows how well you understand this subject. slot gacor

  32. I’m glad I found this web site, I couldn’t find any knowledge on this matter prior to.Also operate a site and if you are ever interested in doing some visitor writing for me if possible feel free to let me know, im always look for people to check out my web site. slot deposit pulsa 10 ribu

  36. Definitely As i browse the application last week though My partner and i various brain to sort it out and from now on Need be to enjoy a book the application repeatedly considering it is especially well crafted. Homepage

  45. Thanks for your readable post !! in addition bunk beds are a great way to maximize floor space in a bedroom. They are also popular in dorm rooms and vacation homes, as they can fit several people in one room.

Leave a Reply

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