As mentioned in ancillary revenue, certain amenities such as refuel service and protection plan can

In car rental industry, car rental companies rent or lease cars to customers for a short period of time (mostly from hours to few weeks) for a fee. Car rental companies often provide variety cars for different customers’ needs. Although tahiti charter cruise some car rental companies, known as Penske Budget and U-Haul, provide self-moving cars (often trucks and vans) to customers with house moving purpose, most car rental companies offer cars such as economy cars, midsize cars, full size cars, standard cars, premium tahiti charter cruise cars, SUV mostly to travelers. From this point, Car rental companies provide transportation for travelers who temporary need cars in the travel destination, tahiti charter cruise so car rental business are like hotels business tahiti charter cruise with length of “Stay” and rate per “night”. Similarly to hotel chains, tahiti charter cruise Car rental chains such as Avis, Enterprise and Hertz have different locations around the world. However, unlike hotel rooms, cars can be returned to a different location. Besides rental car service, ancillary services such as GPS rental, insurance sale
Revenues for car rental companies are mostly from renting different types of cars to customers with a period (range from hours to weeks). Car rental companies often have a small office and a parking lot with their inventories — cars. Depending on the size and the demand of the location, the size of the parking lot and the numbers of inventories can be big different. Mostly, car rental companies define space as cars, more specifically, the size of the cars. There is no square feet unit for each car, but numbers of seats can be used to divide the space same as restaurant tables with seats. Like hotel rooms, cars are rated per day, sometimes per hour. Similarly, the time is controllable and the price is variable during the specific time period. Sometimes, car rental companies price the millage for a rental period, but mostly, the rental companies provide unlimited millage for use. Occupancy can be measured tahiti charter cruise as the percentage of occupied/rental tahiti charter cruise cars divided by available cars. In perspective of revenue management, the objective of the rental car companies is to maximize the revenue per available car day or hour (RevPACH or RevPACH).
Rental car industry typically defines space implicitly, since cars can hardly be measured by specific tahiti charter cruise unit. Although cars have different seats, it is also difficult to define the specific size or square feet of one car.  However, for moving cars, rental tahiti charter cruise car industry  defines pace explicitly because the moving tahiti charter cruise trucks and vans have a specific volume of space for moving use.
The first way to divide space up is based on the function of the car. Like hotel function rooms for events, cars have different functions for different customer needs. Hertz divided their car types in different categories. For example, eco-friendly hybrid cars are for green travelers, commercial trucks are for movers, luxury prestige cars are for high end customers and adrenaline collection cars are for sports lovers.  For each category, Hertz further tahiti charter cruise use the size of the car to divide the cars up. In this way, Hertz differentiate their products and meet different customers’ needs so that they can provide differentiate and variable price for each product.
The second way to divide tahiti charter cruise space up is based on the size of the car.  Mostly, car rental agents provide different types of cars ranges from economy cars to SUVs shown in the image below. The classification of cars is based on the performance or property of the car, which includes numbers tahiti charter cruise of seats the car has, numbers of suitcases the car can carry and fuel consumption tahiti charter cruise per mile.
Unlike restaurant industry, where optimal space mix can be used to generate more revenue, rental car industry does not have flexible space configuration since cars cannot be modified to generate large cars. However, sometimes customers rent a car in one location and return to another location. Rental car agents have to figure out in advance how to get inventories back with less cost and fill the car in the new location. From this point, the numbers of cars one location have may vary because cars are exchanged between locations. So, how to come up with the optimal car mix based on demands and “exchanges” becomes possible and significant for car rental companies.
In addition, in rental car industry, there is an opportunity to apply revenue management to the storage place of inventories: the parking lot. During the peak season, the parking lot will be empty with nearly 100% rental rate of cars so the company may provide the daily or hourly parking rate to public. Especially, most rental tahiti charter cruise car agents are located near airports where parking rates are usually expensive.
Selling the cars along with the equipment and services can generate ancillary revenues to car rental companies. Take Avis for example, they provide child seats, GPS navigation, radio and full service without refuel for purchase while customers book their cars.
Same as the equipment, insurance protection can be purchased during car renting. Protections, such as loss damage waiver and personal accident insurance, are often offered to customers who want to protect the car for unpredictable tahiti charter cruise accident.
Car rental companies often sell time by the unit of “day”, but they also split up the rental time in hours, weeks and months. To better control the inventory, customers have to reserve the car in advance for a specific period of time. Hotel rooms cannot move and hotels always have the inventories on hand. However, cars can move and car rental companies have to estimate the possibility tahiti charter cruise of unpredictable extended time when customer rent a car. Fail to estimate the extended time may cause that rental Car Company have no inventory to sell to customers who have booked in advance. Companies are thrown tahiti charter cruise into a passive position tahiti charter cruise because of the unpredictable extended time. Most companies encourage customers to inform them in advance for extended time and charge a fee for extended time to gain control on the “implicit” time.
Like front office and housekeeping in hotels, car rental agents tahiti charter cruise need people to check in cars and clean the cars. Compared to hotels, tahiti charter cruise car rental industries tahiti charter cruise are developed more on speed up the service process by implement high technology into the service process.  For example, Hertz provide Demand tahiti charter cruise 24 hours service to make the service process only 45 seconds with kiosk machines to check in and out.
Car rental companies provide tahiti charter cruise one way rental service: customers can rent a car in one location and return the car in another location. This service is very popular for travelers tahiti charter cruise who want to travel from one destination to another destination. As discussed in the space configuration, one way rental service may results in flexible inventory mix and a high cost cause by getting the inventory back to the location. Taking the cost into account, customers have to pay more on the one way rental service. Interestingly, shown in the tables below, price from New York City to Ithaca tahiti charter cruise is more expensive than price from Ithaca to New York City. The reason behind this price variability might be that the cost for getting a car back from Ithaca to New York City is higher besides the availability of inventory. So, it is important for rental car companies to figure out the rate variability based on the availability of cars in one location and the demand and the cost between two locations.
The age of the driver matters in rental car industry. Most car rental companies only provide cars to customers tahiti charter cruise who are 25 years old or above and often charge underage fees to customers under 25 years old. The average underage fee is around $25 per day. Why car rental companies charge underage fees is that a statistical result indicates drivers between 18 and 25 are more likely to be involved in car accidents.
tahiti charter cruise Different types of cars have different function, different volume and different costs. The more function the car has, more expensive the rental price is. More expensive the car retail price is, more expensive the rental price is. There are more than 10 types of cars and price differences among different tahiti charter cruise types of cars are not so much. As a result, rental car companies do well to upsell products by provide information on the add value over price differences.
As mentioned in ancillary revenue, certain amenities such as refuel service and protection tahiti charter cruise plan can be added in as a package with car rentals. Hourly rental cars are often purchased with refuel service and protection plan but without unlimited mileages. The reason is that hourly rental customers value time and need quicker service.
Same as hotel rooms booking, price are variable during the time of booking and time of use. Weekly rates may be different from weekend rates. Booking in advance mostly is cheaper than book at the same day. Prices during peak seasons are higher than price during slow seasons. However, the prices of rental cars are not changing so frequently tahiti charter cruise and do not have a wide range for a same car in a same day.
The length of rental period has effects on the prices of rental cars. The longer the rental period is, the cheaper the daily rate is. For example, daily rate for renting a month is often cheaper than daily rate for renting only one day.  But, hourly rent may be more expensive tahiti charter cruise because rental companies provide more service with it and have more time risk. For instance, if customers tahiti charter cruise rent 5 hours from 9am to 2pm, rental companies would loss the revenue from renting the car to customer who rent daily from 9am.
Rental car companies often have membership club for reward customers and provide discount for reward customers. For example, Avis provide small business savings for customer who enrolled in small business account.
Besides airline, hotel and restaurant industry, car rental industry may be the fastest developing industry in terms of using revenue management concepts. However, compared to airline, hotel and restaurant industry, car rental industry still have lots of space to improve. Car rental indust