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Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith

Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith. Executive Summary. Financial Analysis External Analysis Entry & Rivals Industry Customers Substitutes, Complements, Acquisitions Internal Analysis Recommendations. External Analysis: Entry. Deregulation Act

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Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith

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  1. Presented By: Kelly Bossolt Marta Kovorotna Sarah Smith

  2. Executive Summary • Financial Analysis • External Analysis • Entry & Rivals • Industry • Customers • Substitutes, Complements, Acquisitions • Internal Analysis • Recommendations

  3. External Analysis: Entry • Deregulation Act • Enabled new entrants • 150 went bankrupt • 8/11 developed merging agreements • Created competition • Creating lower prices • Creating more travelers • Rivals • Delta, United, American • 80% Domestic Market, 67% Trans-Atlantic Market

  4. External Analysis: Industry • 2nd Tier Providers • Took on the abandoned and ignored markets • Hub – and – Spoke • 80% costs were fixed • Control Mechanism • Sublease for premium (18% higher for Southwest) • Efficient

  5. External Analysis: Customers “The ones that could afford to fly, and the ones that couldn’t” • Two types of travelers • Convenience, time oriented • Price sensitive, leisure • Two tiered Pricing structure to accommodate both

  6. External Analysis: Substitutes & Complements & Acquisition • Substitutes • Train, Bus, Boat, Car, Horse • Complements • Meals, Comfortable seating, Television • Imitator • JetBlue • Southwest acquired and integrated into its own • Diversified locations • Slightly more sophisticated • Leather Seats, Televisions

  7. Recommendations • Move to international markets • Not necessarily Trans-Atlantic, but integrate new markets

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