May be the MR Industry Headed the Air travel Industry Way?


The truth is the MR market is much like the troubled air travel industry. It’s a difficult comparison to swallow. There exists a high Fixed cost component such as the air travel industry – essentially trained people whose salaries need to be compensated, investments in systems, communication equipment etc. These Fixed cost component can’t be easily altered/reduced to mirror alterations in business situation.

What about an evaluation using the hotel industry? In the end your accommodation industry too includes a high Fixed cost structure – but continues to be reasonably effective in consistently maintaining high margins.

I believe the main difference between your hotel industry and also the air travel industry would be that the air travel industry relies only on ticket fares because of its revenue source i.e. it’s merely a single income. Your accommodation industry – additionally to the fundamental room tariff – offers Useful service (for example food, laundry, business desk etc) and really charge the clients for this. Quite simply it’s multiple causes of revenue, and uses every chance to supply VAS and really charge clients for this. That’s the reason why your accommodation industry has continued to be relatively lucrative.

The MR industry too should start genuinely supplying useful services on every project – and charge clients for your service (additionally towards the usual project fee). Before the MR industry starts really Carrying this out (as opposed to just speaking about this), we’re determined to go exactly the same way because the air travel industry.

Incidentally, the air travel market is now attempting to emulate your accommodation industry – witness the truth that of all airlines passengers now have to purchase food around the aircraft. However I question whether this model is useful for airlines whether they have tampered using the fundamental bread and butter revenue source i.e. check in fares.