Financial And Market Analysis Of Premium Economy Business Commerce Essay

Financial And Market Analysis Of Premium Economy Business Commerce Essay In the airlines industry, in order to achieve success in the market competition, superior market players have to generate a good understanding about the underlying demands in the market. Traditionally, airlines provide three major flight classes to the customers, namely economy, business and first class flight and services. With the prosperous economic development and the increasing demand in air travel, the idea of premium economy is introduced and it is now being widely accepted by the airline industry. Premium economy, or maybe called differently by different airline companies, generally offers a wider space and more premium service to passengers, and accordingly, requires a higher ticket price. The purpose of this paper is to analyze the current performance outcomes and the market potential of premium economy business. The first question will be answered with the comparison and analysis of five selected airline companies which have already launched premium economy business during operation. These five airline companies include Qantas, United Airways, British Airways, Virgin Atlantic Airbus, and ANA. Then based on the performance outcome comparison, the second question will be answered with a further market demands and input-output analysis. 2.0 Premium economy business in the five selected airline companies Premium economy, a niche market strategy widely introduced in long haul market of business travel, is not standardized. In United Airways, the idea of premium economy is called Economy Plus; while in British Airways, it is called World Traveler Plus. Meanwhile, premium economy business is being carried out differently in the five selected airline companies. Some may only provide extra legroom with other service no more different from standard economy; while other airline companies may emphasize a clear distinction from traditional business by introducing priority boarding, excellent on board service and entertainment, etc. 2.1 Qantas premium economy business Premium Economy is available on all Qantas A380 aircraft and selected B747-400 aircraft with selected flights from Sydney to Los Angeles, London, Singapore, Bangkok, Johannesburg, Hong Kong, Buenos Aires, San Francisco and New York, and from Melbourne to Los Angeles, London, Singapore and Hong Kong. In Qantas premium economy project, passengers are entitled to benefits such as priority check-in, extra legroom for stretch out and relax, personal TV, laptop power for all premium economy seats, and priority in disembarkation. Qantas has introduced three types of aircraft and twelve scheduled flights to provide premium economy business. Detailed seat information is extracted and analyzed. Averagely, premium economy delivers a 2 extra inches of seat width, 7 extra inches of legroom. However, with an analysis into the seat number, it can be seen that premium economy business is not so widely introduced in Qantas. Averagely, seats for premium economy business just take up 9% of the total available seats in one flight. As to the ticket price for each class, generally, in Qantas, premium economy is generally 80% more expensive than standard economy. And the price for premium economy stays quite the same for the whole month, thus preventing discount for advanced bookings (Qantas, n.d.). 2.2 United Airways premium economy business Premium economy is widely available on 15 types of aircrafts in the United Airways. The flight routes are selected between a variety of North American destinations and Hawaii. In United Airways, premium economy is called as economy plus, which is not a separate class of service but differs from standard economy with up to 3 to 5 inches of extra legroom. Generally, seats for economy plus are located nearer to the front of the aircraft, so that passengers in this section will be served first. Benefits such as priority check-in, personal TV, laptop powers, or priority in disembarkation are not entitled to economy plus passengers. Averagely, premium economy delivers almost the same inches of seat width, 4 extra inches of legroom. With a look into the seat numbers, the total average seats available on these aircrafts are 210, and averagely, seats for premium economy business take up 23.7% (50 seats) of the total available seats. As to the ticket price for each class, generally, in United Airways, premium economy cost much the same with standard economy (United Airways, n.d.). 2.3 British Airways premium economy business Premium economy is called world travelers plus in British Airways, and it is available on 5 types of aircrafts and a variety of flight routes. In British Airways world travelers plus project, passengers are entitled to benefits such as priority check-in, extra legroom for stretch out and relax personal TV, laptop power, and priority in disembarkation. Averagely, premium economy delivers almost the same inches of seat width, 7 extra inches of legroom. With a look into the seat numbers, the total average seats available on these aircrafts are 268, and averagely, seats for premium economy business take up 11.5% (30 seats) of the total available seats. As to the ticket price for each class, generally, in British Airways, premium economy is generally 90% more expensive than standard economy (British Airways, n.d.). 2.4 Virgin Atlantic premium economy business Premium economy is available on 6 types of aircrafts and a variety of flight routes. In Virgin Atlantic premium economy project, passengers are entitled to benefits such as priority check-in, extra legroom for stretch out and relax personal TV, laptop power, and priority in disembarkation. Averagely, premium economy delivers a 4 extra inches of seat width, 7 extra inches of legroom. With a look into the seat numbers, the total average seats available on these aircrafts are 360, and averagely, seats for premium economy business take up 12.6% (45 seats) of the total available seats. As to the ticket price for each class, generally, in Virgin Atlantic, premium economy is generally 46% more expensive than standard economy (Virgin Atlantic, n.d.). 2.5 ANA premium economy business Premium economy is available on 5 types of aircrafts in ANA. The flight routes are selected from Nagoya to Taipei and Tianjin routes, Narita-Hong Kong route, Narita and North America as well as the NRT LHR route. In ANA, premium economy differs from standard economy by providing priority check-in, laptop powers, and priority in disembarkation. Averagely, premium economy delivers almost the same inches of seat width, 4 extra inches of legroom. With a look into the seat numbers, the total average seats available on these aircrafts are 257, and averagely, seats for premium economy business take up 12.3% (32 seats) of the total available seats. As to the ticket price for each class, generally, in ANA, premium economy cost much the same with standard economy (ANA, n.d.). 2.6 Comparison of the premium economy business With the introduction about the five selected airline companies premium economy business, it is noted that all the five companies have provided passengers with up to 7 inches of extra legroom. Additionally, except for United Airways, Qantas, British Airways, Virgin Atlantic, and ANA have provided extra benefits for check-in/out and on board service. Such benefits can save much time spent on travel and could leave passengers with a good service impression. However, such benefits are provided with the increase in operation costs. Moreover, the adoption levels of premium economy differentiated with each other to a great extent. Among the five airline companies, Qantas has the lowest percentage of premium economy seats to the total available seats at around 9%; while for United Airways, the percentage of premium economy seats to the total available seats is at the highest level around 23.7%. The diversification in product portfolio may generate the problem of cutting costs down. 3.0 Financial performance of the five selected airline companies As no specific revenue information on the premium economy business could be available from the companies released financial reports, comparison of the financial performance for the five airline companies would be carried out with theoretical analysis. For the airline industry, major airlines have long been troubled by the matter of tremendous fixed costs such as the repair and maintenance of the aircraft, overhead costs and the increasing costs of fuels. In order to cover such costs, airline companies need a great number of passengers to meet the break-even point. In calculating the break even points for each airline service product, the companies may generally follow the formulas below (Horngren, Sundem Stratton, 2002) Break even point (for output) = fixed cost / contribution per unit Contribution (p.u) = selling price (p.u.) variable cost (p.u) Break even point (for sales) = fixed cost / contribution (pu) ÃÆ'- selling price (pu) During operation, the companies will try to lower the break even points so that they can maximize their profits. In order to achieve this, companies can get down on the following aspects: control the fixed cost, increase the output units (loaded passengers), or increase the selling price. As to fixed cost control, it mainly involves improvement on internal control and management; while the pricing strategy will be mainly affected by the passenger market. 4.0 Product profitability analysis When making decisions on new product launches, the companies should assess the profitability of current product portfolio, and the potential profits which may be generated with a new product portfolio. Due to the fact that premium economy generally provides passengers with up to 7 inches of extra legroom and above 2 inches of extra seat width, the introduction of premium economy will inevitably lower the fixed cost amortization. However, if the implementation could generate more loaded passengers, then the decline in fixed cost amortization could be subsidized. The impact of decreased fix cost amortization could be measured by assuming that if the same level of product profits be generated, how many loaded passengers are required. With the figures calculated, a market analysis should be carried out to find out whether such target could be achieved. 5.0 Market acceptance and market potential Every individual in the global world could be potential customer to the player. However, due to limitations resulting from factors like geography, operation scales, cost and benefit principal, etc, the player has to narrow down onto series of segment markets and figure out its target customers, and then focus its marketing efforts and its merchandise on the selected areas (Kurtz, 2010). Information about target consumers backgrounds and their complex buying decision making process is an indispensable part of accurate market identification and positioning activity (Nicosia, 1966). The idea of premium economy is firstly introduced to address the increasing demand from business travel. Unlike traditional market strategy which emphasize heavily on price and cost, strategies for premium economy pays more attention to the product and service quality, as in many cases price is not the primary issue for the business traveler. With the help from advanced information technologies such as visual conferencing, instant messaging system, content management system, etc, business can be done with participants locating all around the world. However, when coming to circumstances under which face-to-face interaction is inevitable to the success of the business, air travel, for its convenience and time saving characteristics, will come as the first choice for business travelers. To such targeted business travelers, what they want most from the flight would generally be the comforts and time saving. Traditionally, the time spent on waiting for check-in/out procedures would almost be more than two hours, which may mean quite a huge time cost to the business. Moreover, exhausted by the uncomfortable sitting environment, passengers may take certain time to fresh up their spirit and energy. This may generally have negative impact on their performance. With the introduction of premium economy business, travelers are provided with more space in which they can stretch out regularly and release the pressure so that they will not feel tired after the journey. Moreover, with the priority in check-in and disembarkation, business travelers could save more time for other important issues. With the product being accepted in the market, it should also be figured out the potential market volume. According to the Civil Aviation Authority (CAA), in 1999, approximately 30 percent of passengers from London to New York were business travelers (1.14 million passengers) (Sky Trails Airline, Ltd, n.d.). If such percentage could be applied to other heated commercial flights, the total market potential could then be analyzed and the product profitability could be worked out accordingly. 6.0 Conclusion With the increasing demand of long haul travel and the increased consumptive power, the introduction of premium economy will become a popular and inevitable trend in the airline industry. In order to make a proper investment decision on product introduction, the airline companies should first work out the break even point of the new product, and then analyze whether such profit could be realized in the current market. Moreover, in introducing the product, the companies should also consider the characteristics and major demands of the passengers and then further tailor the products to their specific needs. List of references ANA, n.d., Premium Economy, viewed 17 August 2010, http://www.ana.co.jp/wws/uk/e/travelservice/reservations/special/py/index.html British Airways, n.d., World Traveler Plus, viewed 17 August 2010, http://www.britishairways.com/travel/world-traveller-plus/public/en_gb Horngren, C, Sundem, G Stratton, W 2002, Introduction to Management Accounting, Prentice Hall, London. Kurtz, DL 2010, Contemporary Marketing, 13nd edn, Thomson South-Western, Mason, Ohio. Nicosia, F 1966, Consumer Decision Processes, Prentice Hall, Englewood Cliffs. Quantas, n.d., International Premium Economy, viewed 17 August 2010, http://www.qantas.com.au/travel/airlines/international-premium-economy-class/global/en Sky Trails Airline, Ltd n.d., Business Plan, viewed 17 August 2010, http://www.referenceforbusiness.com/business-plans/Business-Plans-Volume-09/Airline-Company.html United Airways, n.d., Economy Plus, viewed 17 August 2010, http://www.united.com/page/article/0,6722,1314,00.html Virgin Atlantic, n.d., Premium Economy, viewed 17 August 2010, http://www.virgin-atlantic.com/en/cn/whatsonboard/premiumeconomy/index.jsp

Insurance History Essay

Some 2,000 years ago in Roman times a form of life insurance was practiced by burial societies who paid out funeral costs of members funded by monthly contributions. It is thought that these were year to year arrangements but unfortunately there is not enough evidence remaining to be exact on how they operated. In Britain in the middle ages Trade Guilds provided funeral costs to members in much the same way. The earliest life insurance policy in England was recorded as being effected on the 15th June 1583. The policy was on the life of a William Gybbons (a salter in the City of London) and was taken out by a Richard Martin. The premium was set at  £8 per  £100 pounds of benefit insured. Even at that early date it is of interest that when the policy ended in a claim there was dispute between the insurer and the policy holder over whether the policy should pay up. Luckily for Richard Martin he won the case and the insurer lost. In those days life insurance policies where underwritt en by individuals as opposed to insurance companies. It was also common practice for people to take out life policies on the rich and famous in the hope that they might benefit if that person died. We would have regarded it as a form of gabling. The first actual life insurance company was the Annuity Association founded by the Rev Dr Assheton on the 4th October 1699. Unfortunately this company only survived for 46 years before going bankrupt. Many life insurers were set up as mutual companies where ownership of the company was among the members of the life fund. The policies did not have fixed sums insured as they do today, but instead the fund would pay out what it could afford based on the number of people in the fund that died that year. Now we can be thankful that life insurance has developed since those days. Most policies offer fixed sum insured which can be up to very large amounts. There are a numerous number of insurers all vying for your business. Not only are there pure protection policies but also those which are also linked to some form of investment factor. Life insurance law has grown up and now there are several layers of protection for the naà ¯ve consumer. Whilst all these changes have been good for the co nsumer it also means that the consumer needs to be more aware of what type of life policy they need and where best to purchase that cover. Choice is a wonderful commodity but you need to be able to make a wise selection. More recent changes have been in the growth of life insurers and life insurance  intermediaries who are using the internet as a place of business. Here costs can be controlled, wider markets searched at the click of a mouse and policies handled and concluded at a faster pace. Why not check out what term life cover you could get by visiting http://www.protected.co.uk/ This article was written on the 15th February 2007. This article does not represent ‘financial advice’ as each persons individual requirements will be unique to their needs. If there is something in the article which you which to rely on then please check those details with any person from whom you purchase a term life policy at the time of purchase.

Is It Appropriate for Learning to Read? Essay

Dr. Carla Hannaford, an educator and neuroscientist, presented a revolutionary research that helped people have a better understanding of the things they know and those that they do. Dr. Hannaford’s book entitled Smart Moves: Why Learning Is Not All In Your Head, has been praised for the insightful link made between the body and learning. Joseph Clinton Pierce even considered it as a research work that is greatly significant in understanding education and child development. Aside from that book, she also authored the book, The Dominance Factor: How Knowing Your Dominant Eye, Ear, Brain, Hand, & Foot Can Improve Your Learning. In this book, she looked at the link between the part of a human’s body favored for â€Å"seeing, hearing, touching, and moving† and a person’s way of thinking, working, reading, playing, and interacting with others (Hannaford, 1997). Basically, the research study conducted by Dr. Hannaford scientifically elaborated and explained the connection of one’s mind and body movement and its implication in his/her learning and thinking abilities. In the Dominance Factor book, Hannaford emphasized on the idea that combining one’s dominant eye, ear, hand, and foot has tremendous effects in the way an individual learn. She also discussed the idea of an individual’s dominance profile. This dominance profile, which can be discovered in a simple and non-invasive muscle-testing, is a key element in molding a person’s way of thinking, acting and communicating with others. According to Hannaford, there are actually 32 different combinations of a person’s â€Å"dominant hemisphere, eye, ear, hand, and foot† (Hannaford, 1997). Each profile also helps a person identify what weaknesses they may encounter under stress. She even asserts that understanding one’s profile will help parents and even their children learn together in the best method suitable for them and that which will help the children perform at their highest capability (Hannaford, 1997). The concept presented by Dr. Hannaford could be tested and used in the different learning skills of people. Applying the dominance theory to an individual’s reading abilities is interesting but poses both a positive and a negative manifestation. Hannaford gave two major profile combinations that are easy to assess. She assumes that a person with a dominant â€Å"logic hemisphere, right eye, right ear, right hand, and right foot† understands better in a structured learning method and an orderly and chronological information presentation (Hughes & Vass, 2001). On the other hand, a person with a dominant â€Å"gestalt hemisphere, left eye, left ear, left hand, and left foot† learns faster through a perception of the bigger picture and understands the main idea yet has difficulty in looking at the details or the step-by-step procedures (Hughes & Vass, 2001). Being aware of this assessment, parents who will be able to easily identify the dominant profiles of their children will find it easier to teach their children how to read and read well considering that they will be able to apply the method that will be best applicable for their children. For the children, since their parents already know how they could read better, they will be able to find the learning process more enjoyable and to their advantage especially given that their parents applied the technique where their child may respond well. However, utilizing the dominance theory also poses negative consequences. Parents who are able to identify the dominant profiles of their children, whether it is as easy as the left and right combinations or more complex like an overlapping combination of the two, will only give focus on that dominant profile. In doing so, they are disregarding the development and enhancement of the other profiles of their children which is not that dominant but may well be applicable to their children. It somewhat constrains the parents to single-out the dominant profiles and set aside those which are not dominant at the moment. In all these, it is observable that any theory poses both positive and negative consequences. Although the ideas presented regarding the dominant profiles and reading skills is interesting, the parents should still consider the holistic growth of their children wherein the young ones develop all their skills as much as possible to their full potential and capabilities. References Hannaford, C. (1997). The Dominance Factor: How Knowing Your Dominant Eye, Ear, Brain, Hand and Foot can improve your Learning. UT: Great River Books. Hughes, M. , & Vass, A. (2001). Strategies for Closing the Lea

Buddhism from a Christian View - 920 Words

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