Running Head: Classic Airlines Classic Airlines Marketing 571 Classic Airlines Introduction Classic Airlines is a 25 year old airline company whose recent decline of 19% in their Classic Rewards members due to lack of consumer confidence has senior leadership uneasy. Classic Airlines is proud to be the fifth largest airline in the world with 32,000 employees. Due to rising costs in fuel and labor it has limited the airlines competitiveness in its rewards program. Classic Airlines leadership needs to make a 15% across the board cut while enhancing revenue from its rewards program (University of Phoenix, 2012). Marketing Strategy Relationship marketing is the current marketing strategy Classic Airlines is using.
However, this situation would make the company incur more loss next year, which is about negative $ 293,586. In the mean time, Barb Shepard, the company’s owner, wants to sell the company soon, and she knows a purchase price would be determined by three main factors: the absolute level of profits, the rate of growth in profits, and future potential growth in the market. Barb Shepard also wants to reduce bank debts as soon as possible. Therefore, the company needs new strategic initiatives very much to improve operating profitability and move forward next year. Each of three vice presidents has rendered a separate and distinct strategic initiative, and they are “Introduce a new product”, “Increase promotion”, and “Raise prices and cut costs” respectively.
After two straight years of financial losses in 1994, CEO Ron Allen rolled out a new strategy called “Leadership 7.5.” Allen targeted to reduce Delta’s cost per each available seat mile from more than 10 cents to 7.5 cents, which would match that of major competitor Southwest Airlines (Bryant, 1997). Along with a new company strategy a change followed with Delta’s human resource strategy. This changing policy devastated employee morale and resulted in a decline of customer service, efforts to unionize, and dissatisfaction among personnel. Delta couldn’t keep the past primary policy about human resources so there were several significant changes in Delta’s organization and corporate culture. There are many programs that Delta has built after passing through the cost-cutting reformation in 1997 for getting back its capabilities on customer relationships like rewards and recognition program above and beyond and more.
This as well, will continue to lower Lincare’s profits. Lincare’s operating margin additionally declined from 24 percent to 16.6 percent. The 9.5% reimbursement cut on certain durable medical equipment, as well as the 36 month payment cap, and competitive bidding from CMS are negatively affecting the profits of the company. Lincare operating margins have declined from 28.8 in 2005 to 16.6 in 2009 (morningstar.com). Lincare’s Return on Equity has taken a steep decline over the past 5 years going from 21.83% in 2005 down to 14.54% in 2009.
Initially, for at least the first few months, there will be a lag between what we have available and what the customers or clients know we stock. This could cause decreased inquiries or sales of the specific new models until updated marketing materials are distributed and the website is updated. Another potential risk is the longevity, or “shelf-life” of both the pediatric and bariatric models. We expect there to be increased “wear and tear” for both models, which could reduce the rentable time by 5-10 weeks, decreasing the profit for the rental models. Lastly, increased inventory requires more space.
It has also deferred the delivery of the last eight A380 super jumbos it has on order, as well as the last three of 14 new 787 Dreamliners due for Jetstar. It will also shelve growth plans for Singaporean budget offshoot Jetstar Asia amid intense competition with other budget airlines in the region. Qantas shares fell sharply Thursday, down about 6.5 per cent at $1.1875. Qantas declared a statutory loss of $235 million for the six months to December, compared with a $109 million profit in the same period a year earlier. Revenue fell 4 per cent to $7.9 billion.
In 2008, fliers can expect to see fewer flights and fewer seats as airlines cut costs and reduce growth to counteract rising fuel prices. In essence, peak flying season is becoming a year-round affair. Bailey observes that, “Because full flights cause airlines all sorts of operational problems, travelers should also brace for continuing problems with delays and misplaced bags. That means the chance of being bumped from an oversold flight could be greater, and finding a seat on a later flight will take longer.” Paul S. Hudson, executive director of the Aviation Consumer Action Project said, “It’s not a good thing,” about airlines reducing capacity. “You’re going to degrade the reliability of the system.” Experts say it is
Current Ethical Issue in Business Learning Danielle Christine University of Phoenix Ethics in Management PHL 323 Laila Dabbagh Lambdin February 23, 2009 Current Ethical Issue in Business Learning Identify the ground rules manifested in the situation as well as which ethics theories apply. Circuit City is the nations 2nd largest retailer of consumer electronics, entertainment software and personal computers. On November 3, 2008, Circuit City announced that they would layoff and close 17% of it’s workforce by the end of the year. Due primarily to weakened economic environment and its potential impact on the timing of the overall sales of the companies inventory, cost and expenses. As a result of the companies deteriorating
Recent indicators display worsening conditions as mid January new unemployment claims have increased. The economy has continued to decline based on the unemployment rate, heavy equity losses in housing, and the continued difficulty in obtaining credit. Manufacturing output declines of the last few months of 2008 fell even more in January to the lowest since World War II. The exports had eased the demand decline domestically during mid 2008 but that market also experienced a decline by the end months. The reduction of energy prices mid 2008 is being credited for the overall inflation price slowing.
[224][225] North American air space was closed for several days after the attacks and air travel decreased upon its reopening, leading to a nearly 20% cutback in air travel capacity, and exacerbating financial problems in the struggling U.S. airline industry. [226] The September 11 attacks also led indirectly to the U.S. wars in Afghanistan and Iraq,[227] as well as additional homeland security spending, totaling at least $5