Posted: August 29th, 2013
Southwest Airline Transportation Management
Table of Contents
The Baggage Strategies and their Advantages………………………………2
Recommended Improvement Action………………………………………..5
Southwest Airline Transportation Management
Being the largest airline in the United States, Southwest Airline (SWA) transport management system has been a point of focus in various logistics magazines and business sectors. Through the management of baggage loads and cargo, the airline has hit the top of airline transportation, as this is both a way of marketing the company to the consumers and cutting down on extra costs. Southwest Airline has taken advantage of the baggage care and delivery in order to attract more customers, make more profits and stay ahead of the competition.
The Baggage Strategies and their Advantages
In order to ensure that the baggage transportation system is as effective as the transportation of the customers, the airline service has a network within the United States that is focused on one airplane. This is the Boeing 737. In using this airplane, the capacity of the baggage is consistent with the load of the passengers. If any connection is to be made, it will be a connection between the Boeing 737 and the SWA 737. This connection allows the baggage load factor to remain consistent. This form of transport and baggage handling system has a couple of advantages, which place the airline ahead of its competitors.
As a way of baggage checking and inspection, the airline has generated a system of bag-checking rather than allowing customers to put the bags in the overhead bin which is at the main deck (Plunkett, 2009). By encouraging customers to check their bags, the loading and unloading of the baggage becomes much faster, and the staff is more efficient. A fully loaded jet takes approximately 15-20 minutes for passengers to alight. The unloading of the baggage takes more time. This also means that it will take more time to unload the jet. The larger the jet the more time is spent on the ground. More time spent on the ground is translated to less time spent in the air, which is a disadvantage.
Like other businesses in the transportation industry, airlines only make money when the jets are flying. Airline services work hard to make sure that more jets spend more time flying than they spend on the ground. As a result, Southwest airlines encourage customers to check their luggage. They also concentrate on running a homogeneous network. Both facilitate faster turning of flights, and they thus enabling the airline to maximize on its profit.
With the above strategy taking the business to a maximum advantage, the logistics department works with other department to make sure that costs are minimized as much as possible (Schwandt & Franklin, 2010). The baggage strategy is also an extension of the fuel strategy. SWA has been known for employing numerous strategies in order to cut down the costs on fuel. The business has successfully controlled fuel costs by purchasing futures in fuel jet in opposition to possible cost in the market when the consumption will take place.
By making the aircrafts turn faster, the business makes the already bought fuel generate more revenue. This can also be considered as a post hedge leverage pertaining to the fuel in the aircrafts’ tanks. Although the least fuel is being used during these flights, the numbers of customers and baggage load are either more or less if not consistent. This increases the profit to the business.
Another evident advantage about this baggage load strategy is that it is not being used by the other competitor airlines. They either have a challenge imitating this strategy or they have not yet seen its impact to the business. Competitor businesses are still applying the other way of connection of flights. Since the baggage capacity for the different aircrafts is different, the airline spending more finances on the baggage loads and wasting more time not to mention inconveniencing customers.
Examples are evident with the Delta and Continental airlines. If a man decides to take a trip with his wife from Phoenix to Savannah, they will first board a Boeing 757. They will then make a connection to Atlanta thus boarding a regional jet. This is jet is operated by another airline. If, for example, the man decides to have a suitcase and golf clubs as his baggage and his wife decides to carry the same baggage capacity, the feeder aircraft will not be able to accommodate all this baggage. Due to such circumstances, the airlines do not encourage checked baggage. This is a disadvantage to those people who have to carry gold clubs, skis and scuba gear. These consumers are then forced to use such an airline as SWA thus putting it at an advantage.
As earlier noted, the SWA does not mind baggage loads, something that is greatly avoided by the competitor airlines. Managing the baggage network is quite a challenge to many airlines. This is mostly because the baggage load and the aircrafts’ baggage capacity are not coinciding. Most airplanes prefer the least baggage load, if not none. Apart from minimizing the baggage, it helps minimize the liability that results from lost or mismatched baggage, a major challenge in networking. Since SWA has smooth transition of baggage, such network challenges are hardly a problem to the business (SWA, 2011).
In order to keep customers interested in the airline, the competitor airlines choose to pay premiums in order to have the extra baggage delivered to the customer at a later time (Thomas & Charles, 2007). Most people/consumers think that their bags have been lost or misplaced. Apologizes are given, and more promises are made as to the efforts being made in order to ensure the safe delivery of the ‘missing’ baggage. However, these are tactics mostly used in order to keep the passengers patient. This inconveniences the consumer, thus preferring to use a more reliable airline when need be. In such times, the customers turn to SWA. This is how the company attracts more customers as it maintains the ones in existence.
Big airline companies compete in the same areas of business. In order to succeed in the industry, they take advantage of each other’s weaknesses. SWA has taken advantage of the baggage weakness of other big airline companies. Since baggage loads are almost inevitable as passengers have to carry changing clothes when traveling, SWA has attracted a sizeable number of passengers. Passengers want to travel knowing that they will get their baggage on arrival. SWA has managed to fulfill this desire in customers.
Recommended Improvement Action
In most cases, airlines charge an extra fee for the checked baggage. This is discouraging to those consumers who constantly use aircrafts. These types of customers want an airline that allows checking of bags, enables them to get to their destination conveniently and efficiently, without having to pay the extra fee. There are those passengers whose air tickets are paid by their employers, and those who pay their own tickets. In either of the cases, each customer wants to spend the least amount of money on travel as they can. More passenger friendly packages will attract more customers. For example, the Continental Airline does not charge extra fees for customers who are loyal to the airline. However, due to the low baggage capacity, it does not ensure that the baggage will reach the passengers’ destinations at the same time as the passenger.
Southwest Airlines can take advantage of this loophole. For one, the airline can pay the passenger when he/she checks baggage instead of charging the extra cost. Although this may not take place in cash, it would be done by allowing additional flyer mileage for the frequenters (Thomas & Charles, 2007). This deal would attract a lot of passengers, especially those who frequently use flights. It would also water down the loyalty packages given by the competitor companies. The airline can also help the customers track down their baggage, ensuring that their bags are on the same aircraft as they are. They can also ensure the customers that the bags would be on the same connection flight and finally be at the destination.
All this offers, even though they might be in different packages, may push the airline ahead of the competition. They will attract more customers, maintain the existing customers and water down the offers from the competitors. These packages would result to more flight turns thus enabling the cutting of fuel costs and the maximizing of profits. However, this program may be costly. Nevertheless, it would be of a greater advantage to the business.
In order to make such a program work effectively, baggage should be treated in the same way express carriers do to packages. It can be executed by enabling a milestone and track it scanning technology. This can be done at various points and then sent to a PDA (Schwandt & Franklin, 2010). Such points may include deplaned, onboard, check in, destination, among other points. Through such constant tracking, it will not only ensure that the baggage is safely delivered, but it will minimize the penetration of unauthorized or illegal baggage in the aircraft.
Almost 99% of the people aboard an aircraft have baggage. Baggage care and delivery is therefore a very significant part of the airline industry. Southwest Airline has taken advantage of the baggage care and delivery weakness found in many airline services. Through this department, many customers prefer to use the airline due to its convenience carriage delivery of baggage with almost no extra cost (SWA, 2011). The airline is also posing competition to the European airlines due to the application of passenger friendly services (Stellin, 2011).
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