Seat Inventory Management in the Airline Industry Research Paper

Seat Inventory Management in the Airline Industry
An examination of the use of seat inventory management in the airline industry.
# 153693 | 4,579 words | 20 sources | APA | 2011 | KE
Published on Oct 09, 2013 in Business (Industries) , Business (Information Mgmt. and Systems) , Aviation, Aeronautics (General)


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Description:

The paper explains seat inventory management as the allocation of seats to fare classes with an aim of maximizing the airline revenue and optimal utilization of capacity. The paper looks at the history of seat inventory management in the airline industry and discusses the impact of the computerized reservation system and global distribution systems. The paper considers both the advantages and disadvantages of seat inventory management and shows how it has improved the core competences of many airlines. The paper concludes that seat management has become a very important tool in managing efficiency and guaranteeing the competitiveness of the airline.

Outline:
Introduction
History of Seat Inventory Management in the Airline Industry
Current Practice of Seat Allocation and Pricing Management in the Airline Industry
Computerized Reservation System
Global Distribution Systems
Airline Pricing
Advantages of Seat Inventory Management in the Airline Industry
Disadvantages of Using Seat Management in the Airline Industry
Conclusion

From the Paper:

"Seat inventory management is a yield management technique used in the airline industry to allocate seats to passengers. It involves allocating seats with regard to various fare classes in order to maximize revenue. This concept can be spilt into two distinct concepts; Seat-Inventory control; and Inventory management. Seat-Inventory control refers to the procedure involving restraining the figures of seats to be made vacant at diverse fare levels on a potential flight. On the other hand, inventory management refers to the procedure involving levelling the figures of seats sold at various fare levels in order to maximize total traveller returns. The use of seat-inventory management in the airline industry has been achieved through exploitation of computerized corollary systems (Yu, 1998, p. 69).
"Revenue management in the airline industry is an intricate venture, with many extents having to be considered in the process. Issues to do with variable cost factors, fare products, control systems, demand projection, customer conduct, revenue factors, problem scale, and problem interfaces have to be considered. At the same time airline industry companies have some specific traits; that is, consumable (Perishable) products and high fixed costs. In the face of all these complexities and special traits, seat selling is by far the only revenue generation point for the airline industry."

Sample of Sources Used:

  • Andrews, (2007). Textbook of front Office Management and Operations. New Delhi; Tata McGraw-Hill
  • Boyd, A., (2002). Revenue Management and Dynamic Pricing, [Online] Available <www.ima.umn.edu/talks/workshops/9-9-13.2002/boyd/boyd.pdf> Accessed on 27th November, 2010
  • Business Dictionary, (2010). Global Distribution Systems, [Online] Available < www.businessdictionary.com/definition/Global-Distribution-System-GDS.htm> Accessed on 27th November, 2010
  • Curry, E. R. (2001). Optimal Airline Seat Allocation with Fare Classes Nested by Origins and Destinations, [Online] Available < web.cenet.org.cn/upfile/96583.pdf> Accessed on 27th November, 2010
  • Doyle, P., (2009). Value Based Marketing: Marketing Strategies for Corporate Growth. West Sussex; The Atrium

Cite this Research Paper:

APA Format

Seat Inventory Management in the Airline Industry (2013, October 09) Retrieved April 02, 2023, from https://www.academon.com/research-paper/seat-inventory-management-in-the-airline-industry-153693/

MLA Format

"Seat Inventory Management in the Airline Industry" 09 October 2013. Web. 02 April. 2023. <https://www.academon.com/research-paper/seat-inventory-management-in-the-airline-industry-153693/>

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