Registration number: 7252303643 Ryanair V.S WebOn the basis of financial fundamentals, Ryanair is stronger than EasyJet in terms of easyJet Mennen, M. 2005, An Analysis of Ryanair Corporate Strategy. Low fare can be an advantage for EasyJet but airline customers often emphasize more on comfort and services to cost factors both of which are strong elements in high fare airlines. Borrowing from the Southwest low-cost model, EasyJet operated using one type of aircraft and a point-to-point short-haul travel (Kew & Stredwick 2005). "Ryanair Corporate Strategy Vs. easyJet: Competitive Strategy Analysis (Compare & Contrast Essay)." The rate of unemployment in Europe is very high which means a major portion of European population cannot afford to travel by air. Comparative analysis based on PESTEL Ryanair and EasyJet both being the top European low fare airlines face some common advantages and disadvantages. IvyPanda. This lack of personal service can induce people to opt for other low fare airlines. Automobiles, bus services and railways can act as substitutes but where time saving is important, there can be no substitute to airlines. A low ratio is an indicator that an organization can duly pay all its dues. 0 millions to Euro 2,988. Not sure if you can write a paper on Managing Corporate Reputation the Case of Ryanair by yourself? easyJet EasyJets Net Current Assets to Sales i. e. , Working Capital to Sales ratio suggests that the company manages its debtors and creditors very efficiently. Moreover, national airlines like Ryanair get additional benefits from governments during periods of huge losses. Key EasyJet - statistics & facts | Statista Labor Costs: Ryanair has the lowest labor costs in the industry (6 per passenger vs 9 and 17 for competitors EasyJet and AirBerlin [5]). Ryanairs fuel expenses are 45% of its total operational expenses, and so any rise in fuel price will affect Ryanairs decision regarding no-fuel surcharge policy to earn profit (Muller, 2011, p. 38). A business enterprise before its establishment needs to study the forces that will impact its profitability, and a tool for such assessment is Porters 5 forces analysis, which includes bargaining power of customers, bargaining power of suppliers, threat of new entrants, threat of substitutes and competitive rivalry. requirements? Liquidity and Current ratio Under this ratio, we measure the companys ability to meet it short term expenses. Financial Analysis Therefore, a key part of their strategy is meeting the minimum contractual obligations required by airlines to their customers. 2006). Financial Analysis According to the NPV analysis, if the predicted cash flow is correct, opening the sixth restaurant could bring limited profit to the company. 79% and 8. easyJet 12 to 0. 2006). Web1617 Words7 Pages. The two airlines are also the most popular low-cost airlines in Europe. Since the factors cannot be influenced by a business enterprise, so it is upon the business to adapt itself to the factors. This also reflected in the Interest Cover ratio. Horizontal analysis Comparing the sales, operating profit (O. P) and net profit (N. P) of EasyJet and Ryanair it can be seen that all the three elements have witnessed substantive growth between fiscal year 2009-2010 to fiscal year 2011-2012. Technological innovations like videoconferencing is actually another form of substitute since it enables business people to do meetings online thereby flights become unnecessary for face-to-face meetings. 17, no. Other social factors like proportion of old age population must also be taken into consideration as old people tend towards alternate modes of travel due to airsickness or other problems. For example, both airlines fly to different types of airports. Companys headquarter was moved to Geneva which became the first base outside UK. Due to low fares EasyJet and Ryanair face less competition from high fare airlines, but there is internal rivalry between these two airlines. Incidents like growing terrorist threats and air accidents even if they happen to other airlines tend to affect the demand patterns of EasyJet and Ryanair because of their low cost strategies. Ryanair and EasyJet have concentrated their corporate strategies on the cost leadership model because they both strive to become the best companies in the low-cost market segment. This factor is more applicable on EasyJet since it is a low fare airline and availability of other low fare airlines on same route can be a threat to EasyJet. match. 1, pp. 76%. Employees are not engaged in any one particular activity, they do various jobs thus reducing the need of multiple personnel. Thomson, N. & Baden-Fuller, C. 2010, Basic Strategy in Context: European text and cases, John Wiley & Sons, London. Therefore, the company decided to use secondary airports, where their customers would get efficient services. Irish ultra low-cost carrier founded in 1984. With rising employment, the purchasing power of people also improves. must. Ryanair also emphasizes on providing the most efficient customer service compared to other rival airlines. Gearing ratio assesses the companys financial position in the long run. Furthermore, like Ryanair, Easyjet also bases its corporate strategy on Southwests business model. Higher the gearing, higher is the risk to investor. Analysis. Ryanair can either lower air fare to level with that of the new entrant or else can lower further which will make the new entrant struggle to survive because of its low capital base.

Houses For Rent Winston Salem, Nc Craigslist, Articles E