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

 

182,845 thoughts on “Railway Industry in France”

  3. Thank you again for all the knowledge you distribute,Good post. I was very interested in the article, it’s quite inspiring I should admit. I like visiting you site since I always come across interesting articles like this one.Great Job, I greatly appreciate that.Do Keep sharing! Regards, city break paris

  4. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with more information? It is extremely helpful for me. paris city breaks

  6. Great and informative post to read about “Railway Industry in France”, learned a lot about this industry. If you are going to take the railway to France or interested in visit France sometime in the future, I would strongly suggest you check jewelry wholesale deals locally when you reached there since it is the center of fashion world including jewelry and accessories products. I believe you will have suprising findings there for preferred jewelry items to bring back home as gifts or souvenirs.

  7. Awesome dispatch! I am indeed getting apt to over this info, is truly neighborly my buddy. Likewise fantastic blog here among many of the costly info you acquire. Reserve up the beneficial process you are doing here.

  10. Thank you so much as you have been willing to share information with us. We will forever admire all you have done here because you have made my work as easy as ABC. nice city breaks

  11. I think this is an informative post and it is very beneficial and knowledgeable. Therefore, I would like to thank you for the endeavors that you have made in writing this article. All the content is absolutely well-researched. Thanks… nice city breaks

  16. Good to become visiting your weblog again, it has been months for me. Nicely this article that i’ve been waited for so long. I will need this post to total my assignment in the college, and it has exact same topic together with your write-up. Thanks, good share. www lottovip

  18. I recently came across your article and have been reading along. I want to express my admiration of your writing skill and ability to make readers read from the beginning to the end. I would like to read newer posts and to share my thoughts with you. www lottovip

  19. There is so much in this article that I would never have thought of on my own. Your content gives readers things to think about in an interesting way. Thank you for your clear information. moscow city break deals

  25. Thanks so much for this information. I have to let you know I concur on several of the points you make here and others may require some further review, but I can see your viewpoint. city break milan

  27. DETECTIVES IN MADRID WITH THE BEST PRICES

    Do you need the services of a Private Detective in Madrid?
    By hiring the services of our private investigation firm, you can ensure resounding success in achieving all the objectives proposed by our clients by obtaining evidence. Arga Detectives has a multidisciplinary team made up of great professionals from private investigation whose main commitment is to fully satisfy our clients after exposing us to their problems.Click here

    https://www.argadetectives.com/en/detectives-in-madrid.html

  28. Wonderful blog! I found it while surfing around on Yahoo News. Do you have any suggestions on how to get listed in Yahoo News? I’ve been trying for a while but I never seem to get there! Appreciate it. milan city breaks

  29. 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.. bacc9999

  30. betflixเมื่อพูดถึง แหล่งรวมเกมที่มีเกม ให้คุณได้เข้า ใช้บริการมาก ที่สุดในเอเชีย BETFLIX เว็บตรง100% คาสิโนเว็บใหญ่ ที่ครบเครื่องที่สุด และมีเกมต่างๆ ให้คุณได้เข้าเล่นมากถึง 20 ค่ายใหญ่ รวมหนึ่งพันกว่าเกม และด้วยระบบเกม ที่มีความเสถียรที่สุด ที่เราได้อัพเดท และภูมิใจนำเสนอ ให้กับเหล่าสมาชิกทุกคน ได้เข้าเล่น ระบบเกมและการบริการที่ดีที่สุด ซึ่ง คาสิโนออนไลน์เว็บตรง ที่ได้ทำการ พัฒนาและอัพเดทเกมใหม่ๆ

  31. 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. Aircon Servicing

  32. An interesting dialogue is price comment. I feel that it is best to write more on this matter, it may not be a taboo topic however usually individuals are not enough to talk on such as exlain expert
    topics. To the next. Cheers.

  39. Hi there, I found your blog via Google while searching for such kinda informative post and your post looks very interesting for me bacc9999

  42. 10 Home Life-Hack Products That Are Minimum Effort And Maximum Reward
    If you’re not into cleaning & cooking routine and wanna get done with it as fast as you can, these home products are your absolute must-haves. Easy to use and effective – they will be your chores BFFs.
    You can go to our online stores with free shipping @https://www.tophomeclub.com/

  44. I can see that you are an expert at your field! I am launching a website soon, and your information will be very useful for me.. Thanks for all your help and wishing you all the success in your business. Fensterreinigung Frankfurt

  45. I am impressed. I don’t think Ive met anyone who knows as much about this subject as you do. You are truly well informed and very intelligent. You wrote something that people could understand and made the subject intriguing for everyone. Really, great blog you have got here. detectives en madrid de infidelidades

  47. Bintang residencemerupakan sebuah kediaman yang berada di daerah Rumah cikeas dan Rumah cibubur yang memiliki lokasi strategis untuk mendapatkan brosur , harga , dan pastinya promo terbaik

  48. otp murah

    WNRSTORE Adalah Penyedia Jasa Layanan OTP Untuk Semua Aplikasi, Kamu Gak Perlu Repot Untuk Membeli Kartu SIM Baru, Kami Selalu Siap 7×24 Jam Untuk Kamu. Segala Kemudahan Dalam Satu Aplikasi, Sistem Sudah Serba Otomatis (Online 7×24 Jam) – Harga Dijamin Murah Dari Platform Lainnya – Pembayaran Telah Support QRIS Dinamis.

Leave a Reply

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