Question One: The airline industry can be broken down into three primary segments: major airlines, regional airlines, and low-fare airlines. JetBlue Airline is a domestic airline in the United States using a combination of low cost and differentiation as its strategy. In order to know the key forces in the general and industry environment that affects its choice of strategy. Based on Porter’s Five Forces Model, the key forces directly influences are: The threat of new entrance is low. In JetBlue case, the current economy situation creates high market entry barriers, which consists extremely high fixed cost and numerous capital requirement.
The first thing the airline must do is look at the firm supply. If they are to continue the flights from those two hubs then they must determine if at some point in the long run the firm must be profitable or should exit the market. (Brickley et al., 2009, p. 181) Since I would assume that the costs of that route would be quite high it would appear that it would be extremely difficult for them to make a profit especially since there are lower cost airlines that customers could do business with. A competitive firm should produce
Essay SILVERJET: “A FALLEN STAR” Market segmentation is one of the most pivotal factors in the air freight market. Only if markets are properly segmented can airlines find the basis for their product, price and promotional policies. It involves dividing up a whole market so that products and services can then be developed for each part of the market. Practically, a lot of companies were successful with reasonable market segmentations, many others failed as they have made improper market segmentation. Airlines Silverjet is a good example for this, we will understand deeply how important of market segmentation with the success or failure of a company.
Group Case Write-Up: American Airlines What is “Value Pricing” and why did AA introduce it? Value based pricing is a business strategy that sets prices primarily on the perceived value of the good or service to the customer, rather than on the actual cost of the good or service, the market price, competitors price, or the historical price. American Airlines’ value pricing has three key points that compromise the new plan, which are the following: 1) 4 four different fare prices for a given flight (first class, regular coach, 7-day advanced purchased discount coach, and 21-Day advanced purchased discount coach); 2) prices are based on mileage; and 3) lower prices would be available to more business and leisure travelers due to the fact that the new fares were set below the levels of the comparable existing fares. American Airlines introduced value pricing for several reasons. The first major reason was the nature of the airline industry.
The merger itself was questionable. The Department of Justice filed a lawsuit against regarding concerns that it could raise prices for consumers. A settlement was reached, and the world largest airline is formed. American Airlines has been suffering for many years. The company has suffered more losses than profits.
These intellectual property laws are recognized for major contributions to society and the economy. Recently intellectual properties have been credited with the majority of companies’ success, therefore catapulting intellectual properties to the forefront of our social and economic interest. Southwest Airline owns the rights to certain intellectual properties that allow it to stand out among its competition. If a company, especially one in such a highly competitive industry, does not have exclusive rights to certain aspects of its operation than it is extremely difficult to compete. The airline industry seems to be one those that it is very difficult to obtain intellectual properties, especially when dealing
Leslie Fay Companies 1.) Clearly Inventories was a big item to address along with Accounts Receivable. Sales and gross profit were stellar in a time of industry unease. Furthermore Accounts Payable decreases as a percentage of current liabilities while Inventories increase as a percentage of current assets. This is an implausible trend on the Balance sheet that BDO should have investigated further, especially with Leslie Fay’s outstanding Income Statement.
Financial Management Analysis MBA 6160 September 30, 2011 Table of Contents Introduction………………………………………………………………………………………3 Senior Management Profiles…………………………………………………………………..3 Competition………………………………………………………………………………………5 Financial Analysis……………………………………………………………………………….7 Financial Techniques………………………………………………………………………….11 Capital Funding………………………………………………………………………………...12 Working Capital………………………………………………………………………………..14 Summary………………………………………………………………………………………..16 Recommendations…………………………………………………………………………….17 Income Statement……………………………………………………………………………..19 Balance Statement…………………………………………………………………………….20 Cash Flow Statement………………………………………………………………………….22 References……………………………………………………………………………………..25 Introduction The airline industry is currently in turmoil, as rising fuel prices coupled with poor economic conditions and fierce competition makes it difficult for an airline to operate profitably. Therefore, this financial analysis is to prove the necessity for Delta Airlines to merge its cargo operations, passenger operations and aircraft maintenance with the other Skyteam Alliance Airlines. Thus, the cargo operations will be split off, and merged with the other cargo operations from the Skyteam Cargo Alliance to form a new company named Skyteam Cargo Handling, which would only handle the cargo activities for all the Skyteam Cargo Alliance members. The same would happen with their passenger business and maintenance. Delta Airlines, Inc. was incorporated in the State of Delaware, but their corporate office and primary hub is in Atlanta, Georgia.
Americans today have much concern about the concept of outsourcing. Ron Hira and Anil Hira in there book Outsourcing America, pose the question “Who is right and why is there difference in opinion whether this is good for America?” Critics continue to argue that outsourcing has a negative impact on American jobs, the economy, national security and pose that should this be allowed to continue, a prosperous future for all Americans is dim. However, it is also profitable for all to view their complaints as objectively as possible because they would never mention the vast benefits that come with outsourcing, especially here in America. Yes, the subject does bring a lot of insecurity and confrontation, but there are those who see it differently. While outsourcing has negative and positive implications, in the long run the future for American will lean towards the positive side of the scale.
Boeing case study Introduction As highly competitive markets in various business markets have been formulated, it has become the natural phenomenon to see dominating business diminishing through being outweighed by its competitors. Boeing, the leading manufacturer of aircraft in America until late 20th century, is one of cases which lost its dominance by failing to enhancing culture and competitiveness. In this essay, it will discuss the case of Boeing given by Palmer (2008) to analyse the cause of its problematic situation as well as realistic improvements on the organisational culture and stability. The methodology of the document is to select two types of models, Congruence and Star, to demonstrate the current issues and circumstances inside Boeing. Explanation of Models and their Applications The first model selected is called Congruence Model.