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

 

163,640 thoughts on “Railway Industry in France”

  2. I high appreciate this post. It’s hard to find the good from the bad sometimes, but I think you’ve nailed it! would you mind updating your blog with more information? buildpremiumpc

  4. I visit your blog regularly and recommend it to all of those who wanted to enhance their knowledge with ease. The style of writing is excellent and also the content is top-notch. Thanks for that shrewdness you provide the readers! รีวิวufa800

  16. Thank you for posting such a great blog! I found your website perfect for my needs. It contains wonderful and helpful posts. Keep up the good work. Thank you for this wonderful Blog!

  17. Great site and a great topic as well I really get amazed to read this. It’s really good. I like viewing web sites which comprehend the price of delivering the excellent useful resource free of charge
    vpn azar mod apk

  20. 1064nm Laser

    High power, single mode, narrow linewidth DBR structure semiconductor laser with 1064nm band has the advantages of small size and high efficiency.

  23. It’s impressive that you are getting ideas from this piece of writing as
    well as from our argument made at this place. 토토

  24. Your post is very cool, and this post is different and beautiful, and it helps us very much. Thank you for sharing this amazing knowledge. But also check our website. 바카라사이트

  26. You lost me, friend. I mean, I assume I get what youre expressing. I recognize what you are saying, but you just appear to have overlooked that you can find some other men and women inside the world who see this issue for what it genuinely is and may perhaps not agree with you. You may perhaps be turning away alot of folks who may have been lovers of your weblog. Buy TikTok Likes

  27. Flotilla IoT white label gps tracking software is a complete telematics solutions with personalized branding. It is designed ideally for companies that want to make their brand identity in the market. The best part about the Flotilla IoT white label system is that it not only offers excellent features but also has a lot of customized branding options.

  29. I’ve been searching for hours on this topic and finally found your post. 먹튀검증사이트, I have read your post and I am very impressed. We prefer your opinion and will visit this site frequently to refer to your opinion. When would you like to visit my site?

  32. I can’t imagine focusing long enough to research; much less write this kind of article. You’ve outdone yourself with this material. This is great content. cinema

  33. I think this is an informative post and it is very useful and knowledgeable. therefore, I would like to thank you for the efforts you have made in writing this article.

  34. This is also a very good post which I really enjoyed reading. It is not every day that I have the possibility to see something like this.. click here

  35. Thank you for some different informative blog. Wherein else may want to I am getting that kind of facts written in such an ideal approach? I have a challenge that I’m simply now operating on, and i have been on the appearance out for such records. Gate repair San Jose

  36. تصفیه فاضلاب بر اساس نوع فاضلاب مورد تصفیه و استاندارد پساب خروجی انتخاب می گردد . تمامی روش های تصفیه فاضلاب را می توان در پکیج تصفیه فاضلاب بهداشتی و فاضلاب صنعتی به کار برد . در انتخاب روش نوین تصفیه فاضلاب در پکیج تصفیه فاضلاب بهداشتی بایستی روشی را انتخاب نمود که علاوه بر قابلیت اجرا ، سهولت در راهبری و بهره برداری را داشته باشد و همچنین اطمینان از اینکه پساب خروجی بتواند استانداردهای پساب خروجی محیط زیست را دریافت کند .
    روش های تصفیه فاضلاب بر اساس طراحی تصفیه خانه فاضلاب انتخاب می گردد و بسته به نوع فاضلاب و فرآیند تصفیه فاضلاب واحدهای عملیاتی و فرآیندی لازم انتخاب می گردد. تصفیه فاضلاب به صورت کلی به روش های فیزیکی ، بیولوژیکی و تصفیه شیمیایی انجام می گیرد .

  37. Appreciating the article above, really explains everything in detail, the article is very alluring and effective. Thank you and good luck for the upcoming articles credit for this ans swingchair

  39. Nice post. I was checking constantly this blog and I’m impressed! Extremely useful info specially the last part I care for such information a lot. I was seeking this certain info for a long time. Thank you and good luck. joker game

  50. This is my first visit to your web journal! We are a group of volunteers and new activities in the same specialty. Website gave us helpful data to work. BandarKiu

Leave a Reply

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