KEY CONSIDERATIONS

 

Rarely do airlines realize the impact their reservation systems and booking cost have on the bottom line. Often times the true cost is not obvious as the excess cost is passed on to end customers; in the face of declining yields, cost savings can be detrimental to the overall success of an airline. An alternate view may perhaps offer a more compelling reason to relook at the booking cost, for example incremental profit of US$ X million with the same passenger numbers and competitive scenario with only a better distribution strategy and a next generation system (AccelAero).

 

 

Impact of the reservation system

You have the right to question if your system and system provider offer you the competitive edge you need to be profitable.

It may be worth asking:

1. Is your system saving you cost?
2. Is your contract longer than the natural life cycle of your product?
3. Are you receiving upgrades free?
4. Is your support real-time and on time?
5. Should your business model evolve today, do you see your system or supplier being able to address it effectively?
6. Does your system offer flexibility to meet your distribution strategy?
7. Who owns your data, your airline or the supplier?
8. Does your system provide you with a technology advantage?

 

 

Impact of booking costs
According to Star Alliance form 41, typical costs for traditional airlines are about 60% in reservations and sales:

 

	CRS / GDS Fees	18%
	Credit Card Fees	18%
	Sales force /Reservations	5%
	Benefits	6%
	Management & staff	3%
	Other	8%

 

These costs do not include other relevant costs such as:

• Cost of payment fraud / misappropriation
• Booking costs of non-ticketed bookings.
• Cost of In-house infrastructure required to maintain the systems
• Recurring system training costs e.g. new staff

 

Can any airline afford to overlook such an important factor?

Certainly not but they do, which is why at ISA we aim at providing not just the most reliable solutions but the most profit sensible. AccelAero makes it possible to experience the benefits of a high-performance multi-distribution system plus all the advantages of a cost-effective solution.

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