Airline revenue management is a big part of how you manage a large airline or even a regional airline that makes one or two flights per day. You need to use the same technology that is used by larger airlines, and you also need to look at the way that you can make money if you are running a small airline or even flying just one plane. Each step below can be used to ensure that you come to the right conclusion.
How Are Prices Set?
Prices are set by the airline revenue management system because that program has all the information for your plane or planes, and you must enter all your routes because they can be calculated based on mileage and fuel usage.
There are a number of people who would like to raise their prices because they offer special amenities, and there are others that will drop their prices because they want to pass savings on to their customers.
How Many Routes Do You Have?
You must enter the number of routes into the system to ensure that you can calculate each route. Each flight that you put into the system will get its own price based on mileage, fuel, and location.
You may prioritize flights that you go to certain places, and you may choose to drop prices on other flights. The airline revenue management system will generate a price based on your changes, and you can make many more changes if you need to.
Are You Making Money?
The airline revenue management system will tell you if you are making money on each person that gets on a flight. In theory, all your seats are priced differently depending on where they are on the plane. You simply need to know if you are making money on all your passengers.
If some passengers are a loss, you need to know if other people make up for that. When you have a balanced flight, you will feel confident that you are making enough money to run your airline, pay your staff, and maintain your planes.
Departure And Arrival Times
The airline revenue management system also sees the departure and arrival times for all the flights because you need to know how many you can fit into one day. You must schedule your pilots based on how many flights there are, and you must compare what you have scheduled them for with what is allowed by the FAA. Plus, you can add or remove flights to change your overall profits for the day.
Pilot And Staff Salaries
Your revenue management software also accounts for all the people that you need to pay for each flight. You can set up the salary and hourly pay for all the people that are on these flights, and all that money will be deducted from your revenue.
When you see how much money you are making per flight, you can decide when to change prices. Plus, you may need to account for raises that you are giving your staff.
You will find that fuel prices are changing all the time. You cannot count on the fuel remaining cheap or expensive for any length of time. Because of this, your prices can change any time you see the fuel market shift. You can adjust fuel prices in the system, and you can change them for each flight depending on how much each of the airport charges for fuel.
Your revenue management system will be used to ensure that you can communicate with vendors, pay bills, and pay for the services that you need. These communications are all saved by the system, and you can review them in the future if you ever have trouble with a vendor.
The money that you may from your airline is judged purely by how you price tickets and pay your staff. You can manage lol this accounting from the same program, and you can set the prices for each route with no problem.
You can see how much money you are making on each flight, and you can change route prices based on things like fuel prices, demand, and the pilots who are on-board.