...an Australian incorporated company, is a subsidiary of QANTAS currently managed by CEO Bruce Buchanan Industry Both companies operate mainly in Asia Pacific region’s budget passenger airline industry. However, both are not fully integrated as they do not build their own aircraft. Both companies only offer economy class for its flights, which travels within Asia Pacific region and to selected international destinations. Core activities include ? Activity Analysis: First, you identify the activities you undertake to deliver your product or service; Value Analysis: Second, for each activity, you think through what you would do to add the greatest value for your customer; and Evaluation and Planning: Thirdly, you evaluate whether it is worth making changes, and then plan for action. Access the industry’s future growth Current- life-cycle position of the industry Generally, based on the information given, it seems that the airline industry in overall is on a decline. This is supported by the fall in premium air passengers by 25% and the declaration of bankruptcy by Japan Airline However, due to these factors, the initial public offering of Tiger Airways, another budger airline and the prediction of increase in revenue in Jetstar’s operation by Bruce Buchanan, it is likely that the budget airline industry is growing at a rate more than 10%. Key issues affecting future growth | |Description ...
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...Hong Kong Budget Airline Industry Analysis By Jaeyeong Ahn 1155032046 Xie Jianting 1155001899 Shi Weiran 1155002072 Tan Jiayi 1009609441 Gao Jingya 1155001997 TABLE OF CONTENTS 1. Introduction 2. Budget Airline Industry 2.1 Definition & Pricing Model 2.2 Common Practices to Lower Overall Costs 2.3 Development of Budget Airline in America, Europe and Asia 3. Hong Kong Market Analysis 3.1 Competitive Landscape 3.2 Major Budget Airlines in Hong Kong 3.3 Market Analysis 3.4 Target Customer Analysis 4. SWOT Analysis of Budget Airlines 4.1 Strengths 4.2 Weaknesses 4. 3 Opportunities 4.4 Threats 5. Analysis of Success Factors in Budget Airline Industry 5.1 AirAsia’s Success in Asia 5.2 Oasis’s Failure in Hong Kong 6. Conclusion 1. Introduction In September 2013, Hong Kong Express Airways announced its plan to transform itself into a budget airline. Meanwhile, Jetstar, an Australian budget airline, has applied for an operating license in Hong Kong under the belief that there are abundant opportunities for growth in the budget airline industry. However, Hong Kong-based airlines Cathay Pacific and Dragonair strongly insist that the market is saturated, and that new entrants into the market will harm the airline industry as a whole. The purpose of this report is to analyze the prospect of budget airline industry in Hong Kong and to determine if...
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...Economic Analysis on Budget Airline—Taking Ryanair as an example . 1. Introduction Ryanair Ltd. is a pioneered Irish low-cost airline, located in Dublin, Ireland. In 2013, Ryanair was both the largest European airline by scheduled passengers carried, and the busiest international airline by passenger numbers, according to its annual report in 2013. From its official website, data shows that Ryanair operates more than 1,600 daily flights from 72 bases, connecting 184 destinations in 30 countries and operating a fleet of more than 300 new Boeing 737-800 aircraft. The latest news about Ryanair could be found on its corporate website (http://corporate.ryanair.com), saying that “Ryanair has recently announced firm orders for a further 280 new Boeing 737 aircraft, as well as options for 100 more Boeing 737 MAX 200s, which will enable Ryanair to lower fares and grow traffic from 90m this year to over 150m p.a. in 2024. Ryanair currently has a team of more than 9,500 highly skilled aviation professionals, and has an industry leading 30-year safety record”. It is a very typical case for economic analysis. The tragic news about the wreckage of Airasia QZ8501 hit the world on 28th Dec 2014, which put the budget airline in the front of the storm again since it is not the first news about airline crash in 2014. Budget airline is elastic in terms of the speed to repose to the demand change and it makes efforts to sell out its all seat using differentiated...
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...mer Budget carrier's rise shakes up Vietnam's airline market- Nikkei Asian Review Page 1 of 3 Log in | Subscribe | About Nikkei Asian Review Sort by Region | Home | Politics & Economy | Business | Markets | Tech & Science | Viewpoints | Photos | Magazine | Magazine > 20140417 Economic reboot > Business Editor's picks Print | China's media control spreads to Taiwan, Hong Kong Newer Asean members' revenues pinched by free trade zone Students spared the cramming life at elite South Korean schools Nuclear reactors on the rise in Asia April 17, 2014 12:00 am JST Budget carrier's rise shakes up Vietnam's airline market MANABU ITO, Nikkei staff writer Aggressive investors scoop up robotics ventures Most read North Korean drones send shock waves across South Vietnamese budget carrier VietJet is seeking to expand its international services. A VietJet aircraft is seen at Tan Son Nhat International Airport in Ho Chi Minh City. Missing flight makes Malaysia Airlines bailout more likely Philippines building up military as counter to China Japan fighters scrambled 415 times against Chinese aircraft in FY2013 Malaysia's AirAsia refuses to move airport HANOI -- Vietnam's rapidly growing air travel market has a young budget airline that is seriously giving the country's flag carrier, Vietnam Airlines, a run for its money. The low-cost carrier VietJet Air began flying in December 2011 and is aggressively expanding its operations and steadily increasing...
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...to the entire company. The budget is their plan for success. According to Noreen, Brewer, and Garrison (2011) it is a quantitative plan for acquiring and using resources over a specified time period. The budget process can seem like a tedious exercise for some, as it involves and affects all areas of the company, but in the end it enables a company to plan how it will achieve revenue goals and control costs. In the simplest of terms the budget explains how much the company should be spending to produce a predetermined about amount of product which will yield a desired profit. Through the budgeting process and the controlling of costs many company’s like American Airlines, are able to keep their costs at a minimum and profits as high as possible. A company’s master budget is actually made up of a collection of smaller budgets that detail the company’s sales, production and financial goals. These smaller budgets consist of a sales budget, a production budget or an inventory of merchandise purchases budget, a direct materials budget, a direct labor budget, a manufacturing overhead budget, an ending finished goods inventory budget, a selling and administrative expense budget, and a cash budget. The information obtained from these budgets come together to make up the budgeted income statement and the budgeted balance sheet. The sales budget shows the expected sales for the period. Noreen et all (2011) tells us that an accurate sales budget is the key to the entire budgeting...
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...the word budget, the first few words that come to mind is money, time, or saving. However, to clearly understand the concept of budgeting, one must have a clear, concise definition of the word. According to InvestorWords.com, budgeting can be defined as “an itemized forecast of an individual's or company's income and expenses expected for some period in the future” (http://www.investorwords.com/600/budget.html). With that being said, one can conclude that budgeting is the foundation of every financial plan. It doesn’t matter if one is making seven figures a year or living from paycheck to paycheck, if you want to control your money and not let your money control you, one’s best bet are to have some type of budgeting plan. Although some may think that budgeting is all about having restrictions on your spending and not be able to enjoy the finer things in life, the sole purpose of having a budget is to allow one to see where their money is actually going and the best way in which to allocate any funds saved. Also, for those who choose to construct a budget, usually save money that would have been otherwise been spent on unnecessary things; thus, making them able to become wealthier and save for better possessions in the long-term. This paper will detail how to create a budget, how budgeting can build your wealth, the main issues with budgeting, applying budgeting to former class activities, and the relevance of budgeting within the workplace. How to Create a Budget? The main...
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...broad-based statements of purpose. Strategic plans take the broad-based statements and express them in terms of detailed steps needed to attain those goals. Budgets are the short-term plans used to implement the steps included in the strategic plans. For example, a company may have a goal of "Becoming the number 1 company in the industry." The strategic plans would include such statements as: "Increase sales volume by 20% per year." The master budget would state the number of units that are needed to be produced and sold in the coming period to meet the 20% volume increase as well as the production and marketing costs necessary to attain that objective. The master budget would also include estimates of the levels of cash, accounts receivable, inventories, and fixed assets needed to support the budgeted level of activity. 15.2 Operational budgets specify how an organization's operations will be carried out to meet the demand for its goods and services. The operational budgets prepared in a hospital would include a labor budget showing the number of professional personnel of various types required to carry out the hospital's mission, an overhead budget listing planned expenditures for such costs as utilities and maintenance, and a cash budget showing planned cash receipts and disbursements. 15.3 An example of using the budget to allocate resources in a university is found in the area of research funds and grants. Universities typically have a limited amount of research-support resources...
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...examples of planning activities include (1) estimating the advertising revenues for a future period, (2) estimating the total expenses for a future period, including the salaries of all actors, news reporters, and sportscasters, (3) planning how many new television shows to introduce to the market, (4) planning each television show’s designated broadcast time slot, and (5) planning the network’s advertising activities and expenditures. Five examples of controlling activities include (1) comparing the actual number of viewers for each show to its viewership projections, (2) comparing the actual costs of producing a made-for-television movie to its budget, (3) comparing the revenues earned from broadcasting a sporting event to the costs incurred to broadcast that event, (4) comparing the actual costs of running a production studio to the budget, and (5) comparing the actual cost of providing global, on-location news...
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...the budgeting process and primarily focuses on the planning problems with budgeting. The other advocates abandoning the budget and primarily focuses on the performance evaluation problems with budgeting. This paper provides an overview and research perspective on these two recent developments. We discuss why practitioners have become dissatisfied with budgets, describe the two distinct approaches, place them in a research context, suggest insights that may aid the practitioners, and use the practitioner perspectives to identify fruitful areas for research. INTRODUCTION udgeting is the cornerstone of the management control process in nearly all organizations, but despite its widespread use, it is far from perfect.1 Practitioners express concerns about using budgets for planning and performance evaluation. The practitioners argue that budgets impede the allocation of organizational resources to their best uses and encourage myopic decision making and other dysfunctional budget games. They attribute these problems, in part, to traditional budgeting’s financial, top-down, commandand-control orientation as embedded in annual budget planning and performance evaluation processes (e.g., Schmidt 1992; Bunce et al. 1995; Hope and Fraser 1997, 2000, 2003; Wallander 1999; Ekholm and Wallin 2000; Marcino 2000; Jensen 2001). We demonstrate practitioners’ concerns with budgets by...
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...Family Budget Basics It's not always easy to meet our financial obligations each month, and that's where creating a family budget can help. Nearly every day, we have multiple financial demands placed upon us. Whether it is grocery shopping or paying the monthly electric bill, we're faced with family budget decisions all the time. Family Budgeting It's sometimes difficult to deal with financial planning matters such as family budgeting. There is one more bill to pay, or a big decision needs to be made on an expensive family vacation. But no matter how people might try to deny it, this is a hard rule of life: We make decisions all the time that affect our ability to stay out of debt. Additional Resources Household Budget Basics Budget Worksheet Budget Worksheet Part II Family Budget Basics Saving Money Surviving a Recession Staying Out of Debt Financial Planning After a Death Family budgeting is all about choosing between the options available to us, including those that help us to stay out of debt. One of those important options we have includes creating a family budget that meets our individual needs. Unfortunately, for many of us, budgets are a reality check that we try to avoid. For example, our family budget might tell us that we make enough money each month to pay that electric bill, but we need to give up going out to eat twice a week, or eliminate a habit of buying such expensive clothing. These are the types of decisions we are talking...
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.................. 2 1.1. The Basic Concepts of Budget and Budgeting ................................................................ 2 1.2. Definition of Budget ........................................................................................................ 3 1.3. Budgeting and Forecasting .............................................................................................. 4 1.4. Budgeting and Management ............................................................................................ 6 1.5. Budgeting and Planning ................................................................................................... 6 1.5.1 Purposes of Planning and Budgeting systems ................................................................. 7 1.5.2 Limitation of Budgeting................................................................................................. 10 1.5.3 Planning Cycles ............................................................................................................. 11 1.6. Budgeting process (Budget cycle) ................................................................................. 14 1.6.1 Designing the budget ..................................................................................................... 15 1.6.2 Steps in Budgeting Process- Participatory approach ..................................................... 15 1.6.3 Characteristics of a Budget ................................................
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...Prices: It helps the management in fixing selling prices of products or services by providing detailed cost information. 5. Helps in Inventory Control: It helps in inventory by using various techniques such as ABC analysis, Economic Order Quantity, Stock levels, Perpetual Inventory system and Continuous Stock Taking, Inventory Turnover Ratio etc. 6. Helps in Cost reduction: It helps in the introduction of cost reduction programme and finding out new and improved method to reduce costs. 7. Helps in measurements of Efficiency: It helps in measurements of efficiency of operations through establishment of standards and variance analysis. 8. Helps in preparation of Budgets: It helps in the preparation of various budgets such as Sales Budget, Production Budget, Purchase Budget, Man-Power Budget, Overheads budget. 9. Helps in identifying Unprofitable Activities: It helps in identifying unprofitable activities so that the necessary...
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...Discussion Budget, Savings, etc., what are the definitions of these terms? According to an article entitled “Financial Literacy to Everyone” at www.practicalmoneyskills.com, budgeting is plan for your future income and expenditures that you can use as a guideline for spending and saving. Budget came from the old French word “bougette” which means purse. It is practically, a plan and list of all planned expenses and revenue. It is a plan for borrowing, saving, and spending. So why Budget? An average student spends his allowance for books, student housing, tuition fee, and food. These are all expenses encountered not only by students but, in general, most of the people in the world. There are generally three types of expenses usually faced by students, the Academic, Living, and Personal Expenditures or Costs. Academic Costs are usually what eats up the total budget of students. It contains the different expenses that are required in able to carry out a student’s academic life. It varies from tuition fees until the very miniscule expenses utilized for photocopying hand-outs from your professor. Living Costs, on the other hand, are expenses that a student need for day to day living however, indirectly related to academics. These include your expenses in utilities (e.g. electricity, water, and internet bills), personal care expenses (shampoo, soap, etc.), and clothing and food expenses. Lastly, Personal Costs are expenditures that are unique yet still a part of a student’s budget. This...
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...of soap has been fixed at $3.00. The company is in the midst of preparing its budget for 2008 and has furnished the following information. Sales esti mates (in bars of soap): January 120,000 February 150,000 March 100,000 April 120,000 May 140,000 Inventory policy: Closing inventory for finished goods is equal to 20% of next month sales estimates. production requirement. This policy has been maintained since the time the company started its soap production. Required: Prepare the following budgets for the 1st quarter ending March 2008: i) Sales budget ii) Production budget iii) Direct Material Purchase budget (monthly breakdown is not required for this part) Note: Round your answer to the nearest unit or dollar. (3 + 4 + 4 = 11 mar ks) Solution i) Sales budget for the quarter ending March 2008 (3 marks) Month January February March Total Estimated Sales units 120,000 150,000 100,000 370,000 Selling Price per unit $3 $3 $3 Sales Revenue ($) 360,000 450,000 300,000 1,110,000 ii) Production budget for the quarter ending March 2008 (4 marks) Particulars / Month Sales estimates (+) Closing inventory requirement Total requirement (-) Opening inventory Production requirement January 120,000 30,000 150,000 24,000 126,000 February 150,000 20,000 170,000 30,000 140,000 March 100,000 24,000 124,000 20,000 104,000 Total 370,000 24,000 394,000 24,000 370,000 iii) Direct Material Purchases budget for the quarter ending March 2008 (in total) Production requirement for the quarter...
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...Cost Accounting Tabitha Smith ACC 310 Christine Errico January 12, 2011 Cost Accounting What is cost accounting? Cost accounting as referred to as managerial accounting is a system of accounting used specifically by managers (Lanen, Anderson, & Maher, 2011, p. 6). Cost accounting measures, records and reports information about costs to help managers to form a well informed decisions for an organization (Lanen, Anderson, & Maher, 2011, p. 6). Cost accounting methods and their use, budgets including discipline, construction, and elements, and variance analysis are important aspects of cost accounting as a whole, which is an important tool for a successful organization. The main goal of cost accounting is to help managers to maximize value within their organization (Lanen, Anderson, & Maher, 2011, p. 3). One of the fundamental services of cost accounting is to provide information to the manager to guide them to make effective valuable decisions (Lanen, Anderson, & Maher, 2011, p. 3). An essential objective of cost accounting is to create an effective value chain (Lanen, Anderson, & Maher, 2011, p. 4). A value chain is a set of activities in which raw materials are converted into goods and services for consumers to purchase (Lanen, Anderson, & Maher, 2011, p. 4). An organization is responsible to coordinate with their vendors and suppliers along with their distributors and customers to accomplish their objective (Lanen, Anderson...
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