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UBC Theses and Dissertations

Pricing in a congestible service industry with a focus on the ski industry Benavides, Raul Martinez

Abstract

In 2003, the Centre for Operations Excellence at the University of British Columbia's Sauder School of Business worked on a project for a company in the resort industry. The project was an initial attempt to develop and implement a pricing management practice for the ski lift ticket business of that company. Our main deliverable was the development of an Excel-based tool with a user-friendly interface that could help the company in their budgeting of the ski lift ticket business. After completing the project, we did some further investigation relative to pricing management techniques that could be applied to this sort of business, namely a congestible service industry. In this thesis we argue that a revenue management system could bring substantial benefits if implemented in this industry. We also identify the requirements and main features of a revenue management system applied to congestible service industries. Although revenue management is a very popular system in fields such as the airline, hotel and car rental industry, none of them can be classified as congestible industries. The ski lift ticket industry and similar industries possess one characteristic that differentiates them from the ones previously mentioned, there is no fixed capacity. This is the reason why we considered important to study the application of revenue management in congestible service industries.

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