FULL PROFIT SCREENING

Thorough screening of the schedules for possibilities to structurally improve profits. Water-tight methods to identify which weaknesses in the production can be reinforced.

The full profit screening looks beyond the short term and reveals all options to adjust the network and schedules for better network profits.

For immediate cash flow improvements, click here to check out our Quick Win Screening.

The Full Profit Screening delivers the following results:

• PROFITABILITY FROM PLANNING PERSPECTIVE: Which elements of the production have negative effect of profits? Review of connections, schedules, flights, routings, destinations, periods of operation, etc. from the perspective of schedule planning.
  
• THINK BEYOND RESTRAINTS: Review of the implications of restraints,  processes and capabilities on schedule profitability. Evaluation of trade-offs made.
  
• OPTIMAL NUMBER OF AIRCRAFT: Check on the possibilities to improve profits by adjusting the fleet composition, either by scaling down, changing types or by adding aircraft. Also uses Weakest Fleet Line Model.
  
• INVENTORY OF REALISTIC IMPROVEMENT OPTIONS: Summary of the needed steps to turn around the weaknesses and bottle-necks, including quantification of the estimated magnitude of the improvements.
  

The full profit screening is mostly offered in combination with a Network Architecture design and/or Tactical Schedule Optimization. 

 

 

 

THE STEPS OF THE FULL PROFIT SCREENING
The Profit Screening unfolds in four steps:

1- ORIENTATION

2- FOUR LEVEL PROFIT SCREENING

3- REVIEW OF RESTRAINTS, CAPABILITIES

4- INVENTORY OF PROFIT IMPROVEMENT OPTIONS

The process builds on close interaction with company professionals, to ensure full insight in consequences of changes, to explore the possible effects of solutions for bottle-necks, as well as to keep them in the loop. Together with data modelling and analysis of commercial factors, this is one of the purposes of the orientation.

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4-LEVEL PROFITABILITY SCREENING
The quick win screening applies the 4-level profitability screening method. This method is more refined that the traditional accountancy approach that is based on route profitability. 4-level profit screening uses calculations that are more in line with the practice of network management, thus enabling sharper planning decisions. It assesses the unbiased value of traffic flows, flights, destinations and aircraft units, all in the context of the entire production.

The 4-Level profitability screening produces a full and comprehensive inventory of improvement options, their financial effects and other criteria for their prioritization. This includes feed-back on the effectivity of yield- and revenue management policies.

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COST AND REVENUE CALCULATIONS

The adjusted schedule is subjected to a detailed cost and revenue estimate following the airline specific Network CALC method.

Revenues are produced by the OMP Strategy traffic forecasting format. Costs are calculated by indentifying the changes in their basic drivers, so no short-cuts with block hour averages or ASK fees but a calculation into the finest detail!

The results of the adjusted schedule are compared with the present production and are completed with a sensitivity analysis as input to a fully prepared management decision.

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THRU TIME 

Thru time of the Full Profit Screening is 2-5 weeks, depending on airline size and availability of company information.

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PROJECT OPTIONS

The Full Profit Screening produces an inventory of profit improvement options. Optionally the project can be followed up by elaboration of these improvement options into concrete schedules.

It is possible that some of the bottle-necks can better be resolved via other measures than by adjustment of the schedules. In those cases, Schedule Consult can facilitate in developing such solutions.

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