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    Ryanair

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    ManishKumarGupta
    The document provides an analysis of the European airline industry in the 1990s and Ryanair's strategy. It conducts a 5 forces analysis which found the industry had high barriers to entry and low bargaining power of buyers. A 3Cs analysis examines Ryanair's target customers as leisure travelers attracted by low fares. It outlines Ryanair's low-cost business model including outsourcing maintenance, internet ticket sales, and dynamic pricing. Ryanair's value chain focuses on reducing costs through a single aircraft type, operating from smaller airports, and providing minimal onboard services.

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    Ryanair

    Uploaded by

    ManishKumarGupta
    95 views3 pages
    The document provides an analysis of the European airline industry in the 1990s and Ryanair's strategy. It conducts a 5 forces analysis which found the industry had high barriers to entry and low bargaining power of buyers. A 3Cs analysis examines Ryanair's target customers as leisure travelers attracted by low fares. It outlines Ryanair's low-cost business model including outsourcing maintenance, internet ticket sales, and dynamic pricing. Ryanair's value chain focuses on reducing costs through a single aircraft type, operating from smaller airports, and providing minimal onboard services.

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    The document provides an analysis of the European airline industry in the 1990s and Ryanair's strategy. It conducts a 5 forces analysis which found the industry had high barriers to entry and low bargaining power of buyers. A 3Cs analysis examines Ryanair's target customers as leisure travelers attracted by low fares. It outlines Ryanair's low-cost business model including outsourcing maintenance, internet ticket sales, and dynamic pricing. Ryanair's value chain focuses on reducing costs through a single aircraft type, operating from smaller airports, and providing minimal onboard services.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    95 views3 pages

    Ryanair

    Uploaded by

    ManishKumarGupta
    The document provides an analysis of the European airline industry in the 1990s and Ryanair's strategy. It conducts a 5 forces analysis which found the industry had high barriers to entry and low bargaining power of buyers. A 3Cs analysis examines Ryanair's target customers as leisure travelers attracted by low fares. It outlines Ryanair's low-cost business model including outsourcing maintenance, internet ticket sales, and dynamic pricing. Ryanair's value chain focuses on reducing costs through a single aircraft type, operating from smaller airports, and providing minimal onboard services.

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    Ryanair Ltd.

    1. 5 Forces Analysis
    On the European airline industry in and around 1990 to determine the
    degree of attractiveness of the industry

    Threat of Potential Entrants

    Threat of Substitutes

    Only limited number of airlines operating, dominated by national flag


    carriers.
    Restrictions of discretionary fares resulting in low bargaining power of
    buyers.

    Bargaining Power of Suppliers

    Air travel is costlier than other modes of travel cars, buses and trains.
    Airlines provide full service to its customers.

    Bargaining Power of Buyers

    Regulated industry till 1987 with national flag carriers dominance and
    restrictions:
    a. of entry into the airline business
    b. on operating flights between third countries
    c. to establish discretionary airfares
    Restrictions eased out gradually in the areas of airfares, transportation
    volumes and operation of air routes.
    Gulf war broke out in 1991 resulting in low volumes
    Easy entry of new players post easing out of the restrictions

    Aircraft suppliers are few.


    Airports No information
    Fuel No information

    Rivalry Among Existing Firms

    Limited Routes available for each airline


    Limited transportation volumes

    270382311

    2. 3 Cs Analysis
    Including a customer analysis of the industry to evaluate the opportunity
    that OLeary identified

    Customer (Market)

    Competitor

    Level of customer satisfaction in same in small airports that are away


    from the city and large airports when factors such as traffic jams near
    large airports and flight delays caused by airstrip crowding ae taken into
    consideration
    Low fares attracted customers who had previously used cars, buses, and
    trains, and major airline companies former customers
    Vacationers and recreation travelers are attracted to the low cost tickets

    Major Airlines companies tickets are costlier as they operate full service,
    have different classes of travel, full range of in-flight service, free drinks,
    meals, blankets etc. They maintain exclusive lounges in the airports.
    Seat occupancy rate in 60-70%

    Company

    Low cost Management


    Operation thru a fleet of aircraft with all the same model to save on
    maintenance and equipment, on the cost of training, and reducing price
    per order through centralized purchasing
    Airframe maintenance operations are outsourced and paid by the actual
    time required to complete as against dedicated maintenance operations
    Dynamic pricing system
    All tickets booked thru the Internet to save agency commissions
    Employee salaries are high and many own shares in the company making
    the morale high

    3. Value Chain Analysis


    Evaluate the strategy adopted by Ryanair against the strategies taken by
    major airlines

    Infrastructure

    Information System

    Low cost operations


    Activities for reducing cost are enforced across the board in the company

    Own web-site for ticket sales

    Human Resource Management

    270382311

    Technology Development

    On time operations The plane will not wait


    Lower parking fees due to quick turnaround time
    Utilization of Aircraft higher than average

    Marketing and Sales

    Short-distance routes within Europe


    Flights Arrive and depart from small airports in the suburbs of the cities
    for lower costs involved

    Outbound Logistics

    Lower dependency on travel agents


    Ticketless boarding/travel
    Unallocated seats, first come first serve

    Operation

    Package deal with Boeing for large fleet


    Single model of aircraft for lower cost of equipment
    Outsourced Maintenance paid on actual time required

    Inbound Logistics

    Internet Ticket Sales-90%

    Procurement

    Higher Salaries of employees


    Lower cost of training due to single model of aircraft

    Rock bottom airfares


    Dynamic Pricing
    In-flight sales of food, drinks and merchandise
    Rental cars add ons

    Service

    Single class of travel


    No in-flight entertainment, meals, drinks, blankets
    No refund policy

    270382311

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