The Company followed Demand based Pricing and strategy itfollowed was Synchro-Pricing.followed was Synchro-Pricing.
Although it advertised the rent as low asAlthough it advertised the rent as low as€5/day.5/day.
This amount was applicable to weekdays only othewise the This amount was applicable to weekdays only othewise therates are slightly higher.rates are slightly higher.
As the rental date come near the price raises.( to achieveAs the rental date come near the price raises.( to achieve100% fleet utilization)100% fleet utilization)
The total money which the customer paid is sometimes higher The total money which the customer paid is sometimes higherthan the rental charges. Eg:-than the rental charges. Eg:-those who go beyond 100km are chargedthose who go beyond 100km are charged€.12/km..12/km.late return fee islate return fee is€120 per day.120 per day.
Q.1. What are the characteristics of the car rental industry? How dothese characteristics influence the design of service delivery processin this industry in general?
The car rental industry can be categorized into two segments, business andleisure. The business segment’s share is much lower than the leisure. Itaccounts for 35-55%, whereas the greater remainder is dominated by theleisure segment. Traditionally, these rental industries rent cars at differentlocations through agents, which make the procedure manual, diminishing theonline booking to 10% only.In fact, Easy Car covers 90% of the bookings online via their website, and theremaining 10% is done by the reservation system. This shows that thecompany managed to achieve 90% fleet utilization due to hostile pricingwhilst its competitor Avis Europe only achieve 68% fleet utilization.Avis Europe and Hertz are merely examples of car rental industries thatmanaged to approach their customers successfully in Europe. There is alsoSixt in Germany and Atesa in Spain which comprise a major share in theircountries. Nevertheless,...