International Journal of Revenue Management http://www.inderscience.com/browse/index.php?journalID=99&year=2012&vol=6&issue=1/2 Inderscience Publishers Ltd en-uk International Journal of Revenue Management 1474-7332 1741-8186 © 2012 Inderscience Publishers Ltd editor@inderscience.com https://www.inderscience.com/images/files/coverImgs/ijrm_scoverijrm.jpg http://www.inderscience.com/browse/index.php?journalID=99&year=2012&vol=6&issue=1/2 http://www.inderscience.com/link.php?id=44513 Airport demand management strategies have the potential to mitigate congestion and delays. However, the extent to which the delays can be reduced using such strategies is not clear. In this paper, we develop a bound on the minimum possible level of delays that can be achieved using these strategies. We solve the aggregated timetable development and fleet assignment problem to minimise the system-wide delays assuming a single monopolistic carrier that satisfies all the passenger demand in the USA and maintains the same level-of-service as achieved with the current revenue management practices of individual carriers. The problem is formulated as a large-scale, integer linear programming model and solved using linear programming relaxation and heuristics. A network delay simulator is used for calculating the delays under different capacity scenarios. The results indicate the large inefficiencies in the usage of airport infrastructure in the domestic US caused by competitive airline scheduling decisions. An assessment of the impact of demand management strategies for efficient allocation of airport capacity
Vikrant Vaze; Cynthia Barnhart
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 5 - 27
Airport demand management strategies have the potential to mitigate congestion and delays. However, the extent to which the delays can be reduced using such strategies is not clear. In this paper, we develop a bound on the minimum possible level of delays that can be achieved using these strategies. We solve the aggregated timetable development and fleet assignment problem to minimise the system-wide delays assuming a single monopolistic carrier that satisfies all the passenger demand in the USA and maintains the same level-of-service as achieved with the current revenue management practices of individual carriers. The problem is formulated as a large-scale, integer linear programming model and solved using linear programming relaxation and heuristics. A network delay simulator is used for calculating the delays under different capacity scenarios. The results indicate the large inefficiencies in the usage of airport infrastructure in the domestic US caused by competitive airline scheduling decisions.

]]> 10.1504/IJRM.2012.044513 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 5 - 27 Vikrant Vaze; Cynthia Barnhart Department of Civil and Environmental Engineering, Massachusetts Institute of Technology, Room 1-245, 77 Massachusetts Avenue, Cambridge, MA 02139, USA ' Department of Civil and Environmental Engineering, Massachusetts Institute of Technology, Room 1-206, 77 Massachusetts Avenue, Cambridge, MA 02139, USA airline competition airline scheduling delays demand management efficient allocation lower bound airport capacity timetable development fleet assignment revenue management network delay simulation. 2011-12-28T23:20:50-05:00 6 1/2 5 27 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44514 One of the main principles of the current airport slot allocation mechanism in Europe is based on the existence of historical (also called grandfather) rights granted to airlines for using such slots. Through an experimental analysis, we quantitatively show that the system disutility (i.e. the sum of the costs of the individual airlines due to the imbalance between demand and capacity at airports) is higher when grandfather rights (GFRs) are present. Moreover, we consider the interdependence of slots at different airports and we introduce the possibility to fairly redistribute such costs among airlines through monetary compensations. Our results suggest that it is possible to remove GFRs without significantly penalising airlines which own them. Airport slot allocation in Europe: economic efficiency and fairness
Lorenzo Castelli; Paola Pellegrini; Raffaele Pesenti
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 28 - 44
One of the main principles of the current airport slot allocation mechanism in Europe is based on the existence of historical (also called grandfather) rights granted to airlines for using such slots. Through an experimental analysis, we quantitatively show that the system disutility (i.e. the sum of the costs of the individual airlines due to the imbalance between demand and capacity at airports) is higher when grandfather rights (GFRs) are present. Moreover, we consider the interdependence of slots at different airports and we introduce the possibility to fairly redistribute such costs among airlines through monetary compensations. Our results suggest that it is possible to remove GFRs without significantly penalising airlines which own them.

]]> 10.1504/IJRM.2012.044514 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 28 - 44 Lorenzo Castelli; Paola Pellegrini; Raffaele Pesenti Dipartimento di Ingegneria Industriale e dell’Informazione, Università degli Studi di Trieste, Via A. Valerio 10, 34127 Trieste, Italy ' Dipartimento di Management, Università Ca’ Foscari di Venezia, San Giobbe, Cannaregio 837, 30121 Venezia, Italy ' Dipartimento di Management, Università Ca’ Foscari di Venezia, San Giobbe, Cannaregio 837, 30121 Venezia, Italy ATM air traffic management airport slot allocation compensation mechanisms SESAR Single European Sky ATM Research Programme grandfather rights economic efficiency fairness historical rights airport capacity demand. 2011-12-28T23:20:50-05:00 6 1/2 28 44 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44515 Four different modes for transporting wood in the first three stages of the wood supply chain are introduced and compared for real-life-based test cases under various scenarios. They include log-trucks and (foldable) containers. Freight forwarders are employed by sawmills to perform the transports. Their profit is dependent on the used transport mode and the bargained revenue function, which includes different prices for full travel and empty travel times. Tabu search-based algorithms were developed and implemented to solve the emerging vehicle routing and combined vehicle routing and container scheduling problems. The obtained results specify costs and profits of the particular transport technologies and support freight forwarders in their choice of transport mode. It can be concluded that the use of foldable containers could improve the efficiency of transport in wood supply chains considerably. A comprehensive approach to planning the deployment of transportation assets in distributing forest products
Jan Zazgornik; Manfred Gronalt; Patrick Hirsch
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 45 - 61
Four different modes for transporting wood in the first three stages of the wood supply chain are introduced and compared for real-life-based test cases under various scenarios. They include log-trucks and (foldable) containers. Freight forwarders are employed by sawmills to perform the transports. Their profit is dependent on the used transport mode and the bargained revenue function, which includes different prices for full travel and empty travel times. Tabu search-based algorithms were developed and implemented to solve the emerging vehicle routing and combined vehicle routing and container scheduling problems. The obtained results specify costs and profits of the particular transport technologies and support freight forwarders in their choice of transport mode. It can be concluded that the use of foldable containers could improve the efficiency of transport in wood supply chains considerably.

]]> 10.1504/IJRM.2012.044515 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 45 - 61 Jan Zazgornik; Manfred Gronalt; Patrick Hirsch Institute of Production and Logistics, University of Natural Resources and Life Sciences, Feistmantelstrasse 4, Vienna 1180, Austria ' Institute of Production and Logistics, University of Natural Resources and Life Sciences, Feistmantelstrasse 4, Vienna 1180, Austria ' Institute of Production and Logistics, University of Natural Resources and Life Sciences, Feistmantelstrasse 4, Vienna 1180, Austria wood transport metaheuristics tabu search optimisation vehicle routing foldable containers forest products wood supply chains log trucks transport modes revenue management container scheduling. 2011-12-28T23:20:50-05:00 6 1/2 45 61 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44516 Consider a supply chain with one vendor and multiple buyers. That vendor not only manufactures the goods demanded, but also transports them by its own fleet of trucks to buyers that are densely dispersed in a distribution zone. The buyers are sensitive to both price and delivery-time guarantee. We model and maximise the vendors expected profit rate when the prices charged depend on the arrival times of orders. The optimal profit rate is found to be concave in the vehicle capacity. We illustrate our theoretical findings with numerical examples and sensitivity analyses to furnish managerial insights. Modelling shipment consolidation and pricing decisions for a manufacturerdistributor
M. Ali Ülkü; James H. Bookbinder
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 62 - 76
Consider a supply chain with one vendor and multiple buyers. That vendor not only manufactures the goods demanded, but also transports them by its own fleet of trucks to buyers that are densely dispersed in a distribution zone. The buyers are sensitive to both price and delivery-time guarantee. We model and maximise the vendors expected profit rate when the prices charged depend on the arrival times of orders. The optimal profit rate is found to be concave in the vehicle capacity. We illustrate our theoretical findings with numerical examples and sensitivity analyses to furnish managerial insights.

]]> 10.1504/IJRM.2012.044516 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 62 - 76 M. Ali Ülkü; James H. Bookbinder School of Management and Leadership, Capital University, Columbus, OH 43209, USA ' Department of Management Sciences, University of Waterloo, Waterloo, ON N2L 3G1, Canada logistics revenue management order consolidation dispatching differential pricing private carriage nonlinear optimisation supply chain management SCM profit rate vehicle capacity modelling shipment consolidation. 2011-12-28T23:20:50-05:00 6 1/2 62 76 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44517 Revenue management for transportation infrastructure projects is challenging due to the huge amount of capital involved and the deep uncertainty inherent in long service lifetimes. Public-private partnerships (PPPs) provide a way for the public sector to acquire financial resources and transfer risks in such projects. This paper proposes a real options (ROs) incentive to improve revenue management for PPPs. In addition to the initial concession, the public sector offers an RO incentive to the private sector at a premium. Designed in an option game framework, the RO incentive captures the behaviour dynamics of option owner and writer, thus producing an optimal strategy for revenue management that cannot be derived from the standard RO valuation. The RO incentive stimulates the private sector to increase its investment in quality improvement, makes a short concession attractive to the private sector and allows both parties to better manage revenues under high uncertainty. Real options as an incentive scheme for managing revenues in transportation infrastructure projects
Hongyan Chen; Ruwen Qin
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 77 - 101
Revenue management for transportation infrastructure projects is challenging due to the huge amount of capital involved and the deep uncertainty inherent in long service lifetimes. Public-private partnerships (PPPs) provide a way for the public sector to acquire financial resources and transfer risks in such projects. This paper proposes a real options (ROs) incentive to improve revenue management for PPPs. In addition to the initial concession, the public sector offers an RO incentive to the private sector at a premium. Designed in an option game framework, the RO incentive captures the behaviour dynamics of option owner and writer, thus producing an optimal strategy for revenue management that cannot be derived from the standard RO valuation. The RO incentive stimulates the private sector to increase its investment in quality improvement, makes a short concession attractive to the private sector and allows both parties to better manage revenues under high uncertainty.

]]> 10.1504/IJRM.2012.044517 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 77 - 101 Hongyan Chen; Ruwen Qin Department of Engineering Management and Systems Engineering, Missouri University of Science and Technology, Rolla, MO 65409, USA ' Department of Engineering Management and Systems Engineering, Missouri University of Science and Technology, Rolla, MO 65409, USA revenue management real options game theory incentive schemes transport infrastructure projects public-private partnerships PPPs uncertainty. 2011-12-28T23:20:50-05:00 6 1/2 77 101 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44518 The last two decades have witnessed the successful application of revenue management (RM) strategies in many markets where the trading item is characterised by high perishability, as is the case with various types of service. Freight transportation service markets are a less-studied area in the RM science. A particular attribute of such markets is their time criticality and short duration especially in case of ad-hoc shipments. This paper couples the properties of auctions and location-based services in a whole. In particular, it aims to complement a RM strategy, introducing a conceptual marketplace. It also presents an evolutionary market learning approach for participants based on a structured series of auction-based experiments. Next, it capitalises on these findings to interpret the bidders behaviour. Finally, it draws guidelines for the specification of auction parameters. Experimental results provide evidence for the convergence of price between carriers and shippers. Enhancement of revenue management strategies through location-aware m-auctions for logistics services
Dimitrios M. Emiris; Charis A. Marentakis
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 102 - 126
The last two decades have witnessed the successful application of revenue management (RM) strategies in many markets where the trading item is characterised by high perishability, as is the case with various types of service. Freight transportation service markets are a less-studied area in the RM science. A particular attribute of such markets is their time criticality and short duration especially in case of ad-hoc shipments. This paper couples the properties of auctions and location-based services in a whole. In particular, it aims to complement a RM strategy, introducing a conceptual marketplace. It also presents an evolutionary market learning approach for participants based on a structured series of auction-based experiments. Next, it capitalises on these findings to interpret the bidders behaviour. Finally, it draws guidelines for the specification of auction parameters. Experimental results provide evidence for the convergence of price between carriers and shippers.

]]> 10.1504/IJRM.2012.044518 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 102 - 126 Dimitrios M. Emiris; Charis A. Marentakis Department of Industrial Management and Technology, University of Piraeus, 40, Karaoli and Dimitriou Street, Piraeus 185 34, Greece ' Department of Industrial Management and Technology, University of Piraeus, 40, Karaoli and Dimitriou Street, Piraeus 185 34, Greece revenue management strategy location-aware auctions mobile auctions m-auctions logistics services freight transport pricing bidding behaviour LBS location-based services ad-hoc shipments marketplace evolutionary learning auction parameters. 2011-12-28T23:20:50-05:00 6 1/2 102 126 2011-12-28T23:20:50-05:00 http://www.inderscience.com/link.php?id=44519 The widespread use of customer relationship management systems has provided hospitality/hotel organisations with detailed insights into the profitability of their individual customers and at the same time have highlighted unprofitable patrons. Critically appreciating contributions in the area of customer profitability analysis (CPA), this paper provides a retrospective (management accounting) and prospective (customer lifetime value) approach to estimate profitability of customer/guest segments in the hotel business environment. The research enumerates antecedents and outcomes of CPA and proposes an integrated framework to render robustness to the prevalent revenue management systems. Customer profitability analysis an avant-garde approach to revenue optimisation in hotels
Anand Iyengar; Ketan Suri
International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 127 - 143
The widespread use of customer relationship management systems has provided hospitality/hotel organisations with detailed insights into the profitability of their individual customers and at the same time have highlighted unprofitable patrons. Critically appreciating contributions in the area of customer profitability analysis (CPA), this paper provides a retrospective (management accounting) and prospective (customer lifetime value) approach to estimate profitability of customer/guest segments in the hotel business environment. The research enumerates antecedents and outcomes of CPA and proposes an integrated framework to render robustness to the prevalent revenue management systems.

]]> 10.1504/IJRM.2012.044519 International Journal of Revenue Management, Vol. 6, No. 1/2 (2012) pp. 127 - 143 Anand Iyengar; Ketan Suri Institute of Hotel Management Aurangabad, Dr. Rafiq Zakaria Campus, Rauza Bagh, Aurangabad 431 001, Maharashtra, India ' InterContinental Hotels Group, 11th Floor, Tower C DLF Cyber City, DLF Phase 2, Gurgaon 122 002, Delhi, India customer profitability analysis revenue management market segmentation customer lifetime value ABC activity-based costing cost-to-serve hospitality industry hotels customer relationship management CRM management accounting. 2011-12-28T23:20:50-05:00 6 1/2 127 143 2011-12-28T23:20:50-05:00