Advantages Of Low Cost Business Level Strategy

Over the years, company sustained low operation costs and tickets prices following well-developed strategy. Among other measures, it was able to keep prices low by flying only one airplane type, minimizing service and maintenance expenses, and convincing employees to cut gate turn-around times and make the airline more efficient (Fitzpatrick, 2005).

Ryanair is one of the largest airlines in terms of passenger numbers (REF) and has continuously grown in size and value over time as shown above. The extent of such an expanding firm is conveyed over the last eight years as Ryanair’s profits have more than quadrupled. However, there have been drops in profits in 2004 and 2008. In 2004, the airline was hugely affected by the conflicts in Iraq, the renewed threat of terrorism and endless increasing oil prices. However, in this same period, Ryanair managed to launch new bases in Rome and Barcelona, launch 73 new routes, takeover their competitor Buzz for a knock-down price and carry more passengers than BA in the European market. The reason for the decrease in profits in 2008 was due to increases in fuel prices and significantly increased airport charges, particularly at their largest bases at Stansted and Dublin.

Analyze the business-level strategies for the corporation you chose to determine the businesslevel strategy you think is most important to the long-term success of the firm and whether or

In order for a business or corporation to grow and expand at a calculated pace, they must be able to strategize the proper business plan to get there. A strategy is a set of analytic techniques for understanding and influencing the firm 's position in the marketplace (Raimundo, 2001). Having a business

The aim of this report is to carry out a strategic analysis of Ryanair. This will involve investigating the organisation’s external environment, to identify opportunities and threats it might face, and its strategic capability, to isolate key strengths and any weaknesses that need dealing with. Finally, a SWOT analysis will be carried out to assess the extent to which Ryanair’s strategies are suitable to what is happening in its task environment.

Ryanair’s Strategic Capabilities and Competitive advantage can be attributed to its Unique Resources and its Unique(Core) Competencies;

The Cost leadership strategy aims for the business to have a low price product being the lowest-cost producer. The differentiation strategy involves the development of high quality unique product or services which is usually priced high. Focus is the third generic strategy based on competitive scope. A focus strategy targets narrow segment of domain of activity and tailors its products or services to the news of that specific segment to the exclusion of others. (Exploring Corporate Strategy, 2012). An example of a company that currently follows the cost leadership strategy is Ryanair. Ryanair Ltd is an Irish low-cost airline based in Dublin Airport with operational bases at Dublin and London Stansted Airports. The airline has been characterised by rapid expansion, a result of the deregulation of the aviation industry in Europe in 1997 and the success of its low-cost business model. Although initially this strategy was used to gain competitive advantage over competitors, their success has seen the emergence of approximately 60 new low-cost airlines. As Porters generic strategy model states that a company has to choose one of these strategies and try not to combine both strategies it meant that other companies could try to emulate their success by employing the same strategy and an example of companies that have done this is EasyJet and Aer Lingus. However later on in Porters career he understood that are some circumstances

Almost three decades ago, in July 1985, three brothers, Catlan, Declan, and Shane Ryan founded Ryanair airlines in the southeast of Ireland. Little did they know, it would become one of the most successful low- cost airlines in the whole industry. It started with just one leased fifteen seater plane that flew from Ireland to London’s Gatwick airport of which their father, Tony Ryan was the chairman. After the government deregulated air traffic to England, Ryanair got the license to operate from Dublin to London. At the end of that year, the airline had flown 5,000 passengers already. By the following year, it quickly started expanding with the purchase of two bigger but older planes. Since the very beginning the company maintained a low-cost strategy. They managed to provide fares that were 20% lower than what its main competitors were offering.

A unique cost cutting policy would be the main core competence of Ryanair. It refuses to provide any meal vouchers or hotel accommodation for flights which are delayed or cancelled for reasons beyong Ryanair’s control in order to reduce the operating cost. (Ryanair, 2011) Meanwhile, Ryanair is using LFA business model to design the size of its

Prior to 1991, Ryanair had suffered from continuous losses from 1985 to 1989. The first reason that put it into this situation was that it tried to position itself as a low fare airline with the first rate services. It tried to keep low and unrestricted fare, while keep focusing on the best customer service and relationship. This mixed model was proven inefficiency. The low price could lure number of

The strategic plan of Ryanair has been to establish itself as Europe’s leading low-fares airline.” Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.” (www.ryanair.com)

Ryanair was established in the year 1985 by the RYAN family and has grown from a small airline flying a short hop from Waterford to London, into one of the Europe’s largest carriers. The company expanded and within 4 years it had 350 employees, 14 aircraft, and carried 600,000 passengers a year. It is currently serving to 26 European Countries with 148 destinations. It operates on 794 different routes daily serving by more than 1050 flights in a day. It has totally 169 aircrafts running for different routes with 5986number of employees working in it However, Ryanair’s costs rose drastically and it recorded losses of £20 Million sover four years despite its growth. Although consumers were continuing to fly Ryanair

In summary the strategies of the Easy jet plc, Air Berlin and the Ryanair airline can be given as;

The objective of this report is to appraise and evaluate the external environment, internal capabilities of Ryanair and assess the competitive environment. This project report also evaluates the marketing focus deployed by Ryanair in the year 2009 when the airline achieved a benchmark by being Europe’s largest carrier by passenger numbers and market capitalisation.

After researching and went through many articles which were published on the Ryanair Airline in Europe. To me, the online resources are more utilized as book resources which can be dated back to 20th century or more. The article 's which I read gives different facts and the information on marketing strategies which were used by the Ryanair Airline. Many of the contents are related to the work which I learned from this course on Airlines, and Airline Management and Marketing. The Ryanair Airline is known for its ' low airfare and consistent profitability and rapid growth. I think, the main goal for the Ryanair Airline is to provide low airfares for their customers and give high level of service, most of Ryanair passengers get excellent