On the Cheap

Mus­ings are thoughts, the thought­ful kind. For the pur­pose of th­ese ar­ti­cles, a-mus­ings are thoughts that might amuse, en­ter­tain and even en­lighten.

The Star (St. Lucia) - - LOCAL - By Michael Walker

There was some­thing I meant to tell you, but for the life of me I can­not re­mem­ber what; the story of my life th­ese days; get­ting quite for­get­ful – oh, yes! I re­mem­ber: I wanted to tell you about Ryanair, but be­fore it get into that, let me con­fess that when it comes to travel, long-haul travel, I am a ter­ri­ble snob. For decades I only trav­elled First Class – we all have our lit­tle weak­nesses – and if the cabin “up-front” did not at­tain the stan­dards I ex­pected, well, that was the end of that: no more travel on that air­line. Of course, now that the air­lines have more or less scrapped First and re­placed it with all sorts of mis­nomers such as Busi­ness, Up­per, Luxury, Pre­mium, etc, trav­el­ling is not the fun it used to be.

Don't get me wrong now; I have noth­ing against air­lines that of­fer value for money no mat­ter how cheap they are. Take Ryanair, for ex­am­ple – the air­line most hated by most of its pas­sen­gers, yet some­how the most prof­itable of all. I re­cently took a Ryanair flight out of the UK to Europe for £12 – yes twelve – in­stead of the BA flight that cost £640.

Es­tab­lished in 1985, Ryanair ini­tially started fly­ing be­tween Water­ford in Ire­land and Lon­don Gatwick with just one plane, adding an­other plane and an­other route, Dublin to Lu­ton, the fol­low­ing year. The air­line ran at a loss in the first few years. Michael O'Leary, now chief ex­ec­u­tive, ini­ti­ated four key prin­ci­ples that have seen Ryanair be­come the most suc­cess­ful air­line of the last 20 years.

Prin­ci­ple 1: Use one type of plane to keep down main­te­nance costs, to get great deals from man­u­fac­tur­ers through bulk order­ing, to keep a new fleet, and to keep main­te­nance and fuel bills as low as pos­si­ble.

Prin­ci­ple 2: Turn air­craft around fast to get them back in the air and fly­ing full of pas­sen­gers as soon as pos­si­ble, which means more trips per plane and more trips out of crews. Checked bag­gage takes time to load and un­load and adds weight to the plane mean­ing more in fuel per trip. Less checked lug­gage means less time in the air­port and less time re­fu­elling.

Prin­ci­ple 3: Keep over­heads down by avoid­ing fly­ing to ex­pen­sive ma­jor air­ports. Ryanair flies into Lon­don Stansted, not Gatwick or Heathrow. Stanstead is ac­tu­ally closer to Lon­don than Gatwick. Out-of-city air­ports not only save cash in fees, they mean more flights per plane. Un­like other air­lines, Ryanair scarcely ad­ver­tises. Cus­tomers book on­line, with­out us­ing travel agents. The com­pany has few air­port check in desks but Ryanair brings so many pas­sen­gers to an air­port, many re­gional ones are pre­pared to pay for the priv­i­lege of hav­ing them fly there. Staff costs are also kept low; uni­forms, train­ing, drink­ing wa­ter while on the plane are fre­quently de­ducted from salaries, rather than pro­vided by the com­pany. That said, Ryanair has de­scribed its pi­lots as the best-paid in Europe.

Prin­ci­ple 4: In­crease an­cil­lary sales and max­i­mize prof­its; Ryanair struc­tures its prices to en­sure the planes are as full as pos­si­ble by of­fer­ing cheap seats rather than leav­ing them empty for the sake of keep­ing a sin­gle ticket price. The air­line is more likely to of­fer cheap deals far in ad­vance not at the last minute be­cause once some­one's bought a ticket, it means you can start of­fer­ing ex­tras. So-called ‘an­cil­lary sales' ac­count for nearly a third of its in­come. It's easy to see why. A Ryanair flight to Barcelona costs un­der £10 but by the time you've added on a £6 ad­min fee, £10 for re­served seat­ing, and £15 to check-in a 15kg bag, etc, the to­tal jumps to over £50. Then there are ad­di­tional fees for in­fants, sports equip­ment, heav­ier bags, for­get­ting to print your board­ing pass, pri­or­ity board­ing, etc. Ryanair will also sell you ho­tel rooms, travel in­sur­ance, car hire and travel lug­gage. A text mes­sage con­firm­ing your flight de­tails costs an­other £1.50.

There's lit­tle ar­gu­ment that Ryanair's busi­ness model is sound. Cut costs at ev­ery turn, get as much as you can out of your staff and equip­ment and pro­vide only the essen­tials for pas­sen­gers, who are pay­ing for the trip alone and not the ex­pe­ri­ence.

Ryanair's fleet is mod­ern and ef­fi­cient. Its on-time record is the envy of the in­dus­try. Its cus­tomers are no longer leisure-seek­ing­plea­sure-trip­pers alone. It's timetable and de­par­ture times may ap­pear a lit­tle ec­cen­tric at times but more and more busi­ness peo­ple are com­ing to re­alise that a pre-dawn out­bound take-off and a fairly late re­turn flight make for a use­ful day at the ‘for­eign' of­fice with­out the need for an overnight ho­tel or ag­gra­va­tion from the fam­ily. All the same, I have a feel­ing it might take a while for Ryanair to in­tro­duce a First­Class or Busi­ness-Class cabin – un­less they see a profit to be made!

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