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

 

214,234 thoughts on “Railway Industry in France”

  1. 이 글의 내용과 훌륭한 문법을 존경합니다. 이 글에 너무 몰입해서 글을 멈출 수가 없었습니다. 당신의 작품과 실력에 깊은 인상을 받았습니다. 정말 감사합니다. 스포츠 분석

  6. Your information has been invaluable. We’re in the office-tel business in Korea and look forward to future collaborations. OP

  9. 입출금 옵션, 사용자 인터페이스, 그리고 보안 및 라이선싱과 같은 중요한 측면들에 대한 실질적인 평가를 제공합니다.
    메이저사이트

  11. Whether you are looking for a Call Girl in Lahore to accompany you on your next night out or want to have fun with a female companion, the Lahore Call Girls service is the right option. They offer a wide range of services, including French kissing and Lahore and other exotic activities. Call Girl girls in Lahore understand the importance of their bodies and maintain them properly. Escorts allows them to give you a satisfying experience every time you meet them.

  14. Antido Mosquito Sticks
    Introducing Antido Natural Mosquito Repellent Incense Sticks, your family’s ultimate defense against dengue, malaria, and chikungunya. Our vegan formula is crafted with 100% natural actives, including joss powder, camphor, ghee, and laban powder, ensuring a safe and effective way to repel mosquitoes without harming the environment.

  22. Looking for affordable outdoor garden furniture sets? garden sofa
    Check out our cheap furniture store for stylish options that won’t break the bank. Transform your outdoor space without emptying your wallet

  23. Wow, that is captivating analyzing. I am satisfied I determined this and were given to study it. Great process in this content material. I preferred it lots. Thanks for the terrific and particular info.
    Website: https://111.90.140.159/

  24. Investigate the penalties imposed for contributing to the delinquency of a minor jail time, assessing their effectiveness as deterrents and their role in enforcing laws aimed at protecting minors.

  27. Your blog contains lots of valuable data. I am happy that you have shared great info with us. I am grateful to you for sharing an article like this. You can check the below link.
    Isuzu pickup

  41. Foundry Bakehouse and Deli is my go-to spot for a quick breakfast. Their muffins are always fresh and so tasty. Love starting my day with one of their treats.

  42. This article was extremely useful to me, it is just more information than I was looking for since I am slowly becoming familiar with this by applying it to my girl ads website .

  44. The QuickBooks H202 Error
    occurs when attempting to access a company file in multi-user mode but the server hosting the file fails to connect, often due to network issues, incorrect settings, or firewall blockages.

  49. Rose Home Air Freshener has a lovely rose scent that lasts a long time. It makes any space feel calm and welcoming with its elegant aroma. Not only does it get rid of bad smells, but it also adds a nice touch to the atmosphere. The Rose Home Air Freshener smells really good, like fresh rose, making it even more appealing.

Leave a Reply

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