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

 

205,999 thoughts on “Railway Industry in France”

  1. Do you ever have problems driving nails straight? Use Press on Nails to easily drive nails straight. This unique tool features a length that stays constant, so you can nail in precisely the right place every time.
    https://sugabaebeauty.com/

  2. Having a kitchen sink installed by professionals the first time is one of the most important things you can do to improve your home. The right faucet, design and hardware all play an important role in making sure everything fits together properly to form a cohesive unit that looks fantastic and works efficiently. At Kitchen Sink Installation Service we’ve been providing efficient professional installation services for numerous clients just like you within Burnaby BC.
    https://hmkitchens.ca/

  3. We are a well – Established Renovating Small Kitchen Service in Burnaby BC and the Tri – Cities area. With over 15 years of experience, we have helped numerous home owners and business owners in Burnaby, New Westminster, Coquitlam & Port Moody to upgrade their kitchens from reno designs to remodels with many styles to choose from.
    https://hmkitchens.ca/

  6. Interesting post. I Have Been wondering about this issue, so thanks for posting. Pretty cool post.It ‘s really very nice and Useful post.Thanks sihoki

  11. I am happy to find your perceived technique for forming the post. Directly you make it basic for me to grasp and complete the thought. Thankful to you for the post. 脫髮問題

  15. Very helpful field, thanks a ton for ad. “It has long been an axiom of mine that the little things are infinitely the most important.” by Conan Doyle.. MarathiStyle

  17. With over 30 years of experience as a Kansas City emergency dentist office, the knowledgeable staff at Emergency Tooth Pain Center are here to help when you need it most. We offer a variety of emergency services including root canal, tooth extractions, TMJ treatment, and more. If you are looking for comfortable emergency dental care in KC, look no further. We are equipped to handle all dental emergencies, such as root canals and tooth extractions, and will provide swift care to help stop your pain and get you back on your feet.

  19. The mentioned site, is one the most dependable and reliable site to rely on! And have the best solution for your problem!! I would suggest it to everyone! They are the best! read review

  25. The top tourist destinations in the USA will be discussed here. Because there is so much to see in this vast nation, it might be difficult to know where to start when planning a trip there. There are many options available to people in world-class cities, some of which are known for their history and others for their leisure or luxury.
    5 Best Places To Visit In The USA

  26. The Truth about Starting a Small Business

    When people think about starting their own business, many automatically assume that they will be on the road to riches. While this is possible, you should also know that most small business owners work long hours for little pay and fail within the first year.
    Reference : https://bizop.org/

  28. Being a housewife I wasn’t completely able solve my problem on my own due to some family reasons but when I saw them site on the internet it became a relief for me now I can relax at my home at anytime!! Video on youtube.com

  41. You’re not happy with your job, and you don’t see anything changing in the near future. Even if you found other work, it’s very hard to get a raise at most companies anymore, so why stick around? Why not start something of your own?

    Reference : https://bizop.org/

  43. Thanks a good deal for sharing this wonderful facts! I’m looking ahead to viewing much more posts by you without having hold off! I’ve judged that you don’t compromise on top quality. สมัครslotpg

  44. At SEO Services KC, we have studied, observed, and learned through trial and error the best methods for search engine optimization, especially at a local level for Kansas City businesses. Since 2013, we have helped dozens of companies achieve organic rankings on page 1 of Google for their targeted search terms, and always are in the learning mode of honing and growing our knowledge base and skill set in the Kansas City SEO industry.

  45. Incredibly obliging post. This is my first time I visit here. I found such a broad number of enthralling stuff in your blog particularly its exchange. Really its extraordinary article. Keep it up. 脫髮問題

  48. It was a decent post to be sure. I completely delighted in understanding it in my lunch time. Will definitely come and visit this blog all the more frequently. Much obliged for sharing. 脫髮原因

  50. You’ve come to the right place if you are looking for high-quality and effective erectile dysfunction drugs, as well as discretion, reliability, and professionalism in your purchase. Kamagra products are available from our company, which is an authorized seller. As many people don’t know how to take Kamagra pills, this article will describe How To Take Kamagra Pills.

Leave a Reply

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