REVENUE MANAGEMENT IN THE
Feris, Charl Francois Albert
This exploratory research questions whether revenue (or yield) management, as practiced in other service industries, is applicable to the freight rail industry by garnering the perspectives of rail executives from a select, purposeful sample taken from Spoornet, a division of Transnet Limited, in South Africa. This research utilised the semi-structured in-depth interview as the data gathering method. There were nine research questions that covered the main research problem and sub problems. Another objective was to ascertain whether state-owned railroads would be permitted to practise yield management. The research questions and resultant open-ended and categorised questionnaire items were based on the literature review. The significance of this research is to contribute to the knowledge in this field by providing an alternative perspective on yield management for the freight rail environment. In support of this objective, the questions covered aspects of the freight rail yield management problem such as definitions of yield management, it‟s translation for the railroad industry, how it could be implemented in a freight railroad and the capacity unit that would be the focus of yield management initiatives. Yield management functions and industry characteristics as well as market segments favouring yield management were investigated. The major findings of this research are: (i) that due to the nature of this industry, there is an operational aspect besides a pricing aspect to yield management in this industry; (ii) that there are long-term and short-term approaches to yield management in this industry and (iii) that freight rail capacity consists of many types of capacity that are interrelated and care should be taken when implementing yield management compared to other service industries with singular units of capacity. In conclusion, even though this research has established that yield management seems suitable for freight railroads, its application may differ significantly from the short-term yield management found in other service industries such as the airlines and hotels.
MBA - WBS
Revenue management, Freight industry, Freight rail industry