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

 

178,048 thoughts on “Railway Industry in France”

  2. It’s rare to get an expert in whom you may have some confidence. In the world of today, nobody actually cares about showing others the way in this matter. How lucky I am to have now found a wonderful web site as this. It is really people like you who make a genuine difference nowadays through the ideas they discuss. 私補

  3. It really is rare to come across a specialist in whom you may have some confidence. In the world in the present day, nobody genuinely cares about showing others the best way in this matter. How fortunate I am to have found a real wonderful blog as this. It’s people like you exactly who make a true difference nowadays through the concepts they write about. 大學生私補

  6. I found your blog web site on google and verify a number of of your early posts. Proceed to maintain up the excellent operate. I simply further up your RSS feed to my MSN Information Reader. Seeking ahead to studying more from you later on!? I’m often to running a blog and i really appreciate your content. The article has actually peaks my interest. I am going to bookmark your website and preserve checking for brand new information. 補習介紹

  10. My spouse and I absolutely love your blog and find many of your post’s to be exactly I’m looking for. can you offer guest writers to write content for yourself? I wouldn’t mind composing a post or elaborating on a number of the subjects you write about here. Again, awesome site! 補習配對

  14. What would many of us do devoid of the brilliant suggestions you share on this web site? Who else has got the perseverance to cope with important topics in the interest of ordinary subscribers like me? My spouse and i and my guys are really lucky to have your website among the ones we typically visit. We hope you know how a great deal we take pleasure in your efforts! Much luck coming from us all. 補習配對

  15. Click and Get 199 Bonus Now

    I appreciate your warm sentiments and constant support! Your support inspires me to keep writing and aiming for greatness. Keep checking back for more exciting updates, and please feel free to offer any comments or recommendations. Cheers to more thought-provoking and entertaining stuff in the future!

  16. 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. a course in miracles podcast

  19. Navigate through the richness of our blog, where each post is a testament to our dedication to delivering quality, depth, and diversity in every piece of writing Crvbet

  21. Navigate through the richness of our blog, where each post is a testament to our dedication to delivering quality, depth, and diversity in every piece of writing Crvbet

  22. Join the conversation on our premium blog, where a fusion of intellect and creativity manifests in a collection of insightful and thought-leading articles Rans88

  28. 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.IZEBET

  30. Transform your outdoor space with elegance and style with our custom-made gazebo furniture. Each piece is meticulously crafted to suit your unique preferences, ensuring a perfect blend of comfort and sophistication. Explore our collection of custom-made gazebo furniture and elevate your outdoor living experience.

  32. 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 mba

  41. I like what you guys are up also. Such smart work and reporting! Carry on the superb works guys I have incorporated you guys to my blogroll. I think it will improve the value of my web site 補習平台

  43. 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. 不鏽鋼

  44. The first phase the preparation should, theoretically, be uninfluenced by the intended intensity and duration of the sound which is subsequently produced. In fact, however, so quickly are the three phases accomplished that the pianist rarely has capacity to think, in performance, of each phase separately. 訂造不銹鋼

  45. The most inspiring stuff commonly is probably the most dull or boring concern. a single rooster may not be in the same woody plant strip very long, and also the pets within the pine is a kind of weight, always want to consult the next stars, the particular fowl because the plants are really hesitant to facial expression an equal beautiful places day by day. 訂造不銹鋼

  46. Intriguing post. I Have Been pondering about this issue, so much obliged for posting. Really cool post.It “s truly extremely pleasant and Useful post.Thanks 不鏽鋼

  47. Explore a world of insightful content on our high-quality blog, where expertise meets creativity to deliver engaging and informative articles Crvbet

  48. Explore a world of insightful content on our high-quality blog, where expertise meets creativity to deliver engaging and informative articles Crvbet

  49. Explore a world of insightful content on our high-quality blog, where expertise meets creativity to deliver engaging and informative articles Crvbet

  50. Immerse yourself in a treasure trove of knowledge with our premium blog, offering fresh perspectives, expert insights, and captivating stories Rans Slot

Leave a Reply

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