Although your flights are well booked, flight profits are not satisfactory. The yield management or route profitability invests extensive resources in the analysis of the root of this problem. Furthermore, the revenue accounting department can also be involved. The prorate specialists of your revenue accounting are now called upon to play an important role, especially through the analysis of routes which have many connecting flights and interlining.

An effective method to enhance profits in ticket billing with other airlines is the implementation of

» PROVISOS / REQUIREMENTS «

In short to middle distance routes (max 1750 TPM), most airlines apply IATA Provisos and/or Requirements. You could be heading toward diminished profits if your company has not yet published any Provisos. There is certainly limited protection for a carrier without published provisos in the application of the Minimum Prorate Rule (MPR). However to dispense with Provisos would cause diminished profits in every case where the MPR is not applied.

New provisos have to be applied for from the Prorate Agency and must be scrutinized and approved by the Prorate Manual Review Group (PMRG). Provisos which have been agreed to between the airlines and the Prorate Agency are published in the Prorate Manual Passenger (PMP - Part 1) and are binding for all MPA-signatories.

Airlines register their baseamounts with the ATPCO which are then published in the PMP (Part 2 Worldwide Prorate Factors and Base Amounts).

You can find further information regarding provisos in the Multilateral Prorate Agreement and Prorate Manual Passenger or contact me at kneuschmid@airline-consulting.at

In the case that provisos do not sufficiently increase your revenue, the interline partners can arrange for certain routes

» BILATERAL SPECIAL PRORATE AGREEMENTS (SPA) «

There are many possible variations, e.g.

> Fixed price for faretype or bookingclass
> Reduced commission
> Upgrades
> STRP ignoring provisos
> ect

An efficient, future oriented revenue accounting can support route profitablity control by comparing different methods of proration.

In order to ensure, that the SPA is practicable for your needs, the revenue accounting staff should be involved in the evaluation of the contract.

Through my considerable experience in this area, I can support you in finding the most effective provisoregulation for your company. I can also assist you in applying to the Prorate Agency for your provisos and in the publication of your new provisos and base amounts. I will work with your company's prorate specialists to analyse your interline profits and assist in calculating your SPAs. I can also offer to check your existing SPAs for applicability.

Please feel free to contact me for further information or simply visit my homepage www.airline-consulting.at