Title: Air cargo revenue management: a state-of-the-art review

Authors: Dhandabani Srinivasan; R.K. Amit; Wen-Chyuan Chiang

Addresses: Decision Engineering and Pricing (DEEP) Lab, Department of Management Studies, Indian Institute of Technology Madras, Tamil Nadu, India ' Decision Engineering and Pricing (DEEP) Lab, Department of Management Studies, Indian Institute of Technology Madras, Tamil Nadu, India ' Collins College of Business Administration, University of Tulsa, Oklahoma, USA

Abstract: In addition to serving high-value-to-weight goods, the air cargo market is expanding substantially mainly because of globalisation and the need for increased responsiveness in supply chains. At the same time, the theory of air cargo revenue management is far from the contemporary practices because of cargo-specific complexities like uncertain, multidimensional capacities, variable tendering, and forwarder's market power. This paper surveys the scientific contributions relevant to air cargo revenue management. We provide a comprehensive review of the developments in both quantity and pricing revenue management decisions. Additionally, we substantiate each decision with the appropriate dynamic programming formulation, which helps in highlighting the extensions to the current literature. We conclude our discussion by enumerating the potential prospects that are great revenue-yielding opportunities. This review links theoretical contributions and practical problems and serves as the signpost for the 30-year-old air cargo revenue management.

Keywords: air cargo industry; revenue management; quantity and pricing decisions; dynamic programming.

DOI: 10.1504/IJRM.2023.130752

International Journal of Revenue Management, 2023 Vol.13 No.3, pp.144 - 165

Received: 14 Mar 2022
Accepted: 15 Dec 2022
Published online: 04 May 2023 *