what are the risks associated with easyjet's strategy

Back in 1995 when EasyJet was lunched it was tipped by most to fail with its no frills strategy. They fly into second- and even third-tier airports, where they control a dominant share of the gates and can drive tough bargains on any airport fees and charges for ground crews and baggage handlers. Many of those airlines are limping along on government funding they might never be able to repay, says Leah Ryan, managing director of Alton Aviation, a leading industry consultant. By mid-May, most of the major European nations had administered first doses to just over a third of adults amid critical vaccine supply shortages and concerns about rare but dangerous blood clots linked to AstraZenecasand Johnson & Johnsonsvaccines.Without a brisker vaccination pace, a third wave of infectionskeeps threateningto take hold in Europe. Free resources to assist you with your university studies! FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. *You can also browse our support articles here >. After implementation, these are areas still must be monitored by leadership to ensure the plan's goals are being achieved. Ryanair and Wizz Air cater almost exclusively to leisure travelers. The way the report has classified the risk is whether the risk is a generic risk that will affect the whole industry of whether the risk is specific to the company. And the government has said the second of these has to be a more accurate PCR test, which can cost as much as 219 ($302) per passenger. EasyJet appears to have developed competences in supporting much higher levels of business from the same asset base than other rival airlines. Front and center was the existential risk of the coronavirus. Implications from the strategy chosen. But these savings barely stanched the arterial bleed of cash gushing from the companys coffers:In 2019, the airlines operations had generated more than $1 billion in cash. The threemost prominent firms that advise shareholders onhow to cast ballotsin proxy votesISS, Glass Lewis, and Pircall recommended against backing his proposals. It moved aircraft maintenance at three of its U.K. airports, which had been contracted out, back in-house. But with new, more infectious variants of COVID-19 spreading rapidly in Europe, in October renewed lockdowns were imposed across many parts of the U.K. and from Helsinki to Tel Aviv. Highly utilised fleet of aircrafts that are large, modern, efficient and relatively environmentally friendly. As a result, EasyJet occupies a kind of middle groundin both pricing and costsamong European carriers. The first is to reduce the bottom line costs of operation (low cost strategy) and the second is to increase the value of the organisation and its reputation to customers, so that they will demand more or pay more for what they receive (differentiation strategy) (ACCA Paper 3.5 (2001)). Now, more than a year later, with the pandemic still raging, and with many countries, including the U.K., having toughened travel restrictions in response to new strains of the virus, the airline industrys hopes for an early recovery are descending faster than an Airbus A320 on final approach to EasyJets home base at Luton Airport. Effective use of digital and data tools to underpin growth and deepen customer relationships. The customers of EasyJet have been using the Internet for making bookings. Marketing and sales will involve making customers aware of EasyJets services are price information and also selling. At a budget carrier, you need to be aggressive and ruthless and abrasive, says Joachim Kotze, an airline industry analyst for financial research firm Morningstar. The sales process is efficient, as EasyJet sells directly to customers, instead of using external sales teams. The first step in the risk analysis process is identifying risks you think could affect your project. The carriers were expected to pare their loses to about$38 billionthis year, as vaccines are rolled out across the world. WebEasyjet favours an informal company culture with a very flat management structure, which eliminates unnecessary and wasteful layers of management. Porter explains that there are five forces inherent in a market, which will jointly determine the intensity of competition and profitability of EasyJet and the airline industry. Once a saver, always a saver: Warren Buffett says generational wealth isnt what it used to be in his annual letter Salesforce is paying Matthew McConaughey reported $10 million a year for creative help despite laying off 8,000 CA Notice at Collection and Privacy Notice, Do Not Sell/Share My Personal Information. The risks associated with a differentiation strategy include imitation by competitors and changes in customer tastes. As hard as it has tried to inoculate itself against the pressures of the pandemic and to convince passengers it will be safe to fly, its fate remains up in the air, subject to unexpected and unwelcome turbulence. These moves enabled EasyJet to reduce its operating costs, excluding fuel, by about 31% in the year through Sept. 30, 2020. Focus on seasonality improvements such as season contracts and bases. Potential negative outcomes include bad publicity and a Hes running the business to make it as lean as possible, and you cant be a nice guy and do that, Kotze says. easyJet's updated framework continues to build on its competitive advantages - an unparalleled network and market positions, efficient low cost model, well-known brand and strong balance sheet - positioning easyJet to deliver sustainable and disciplined growth and returns for shareholders. At the end of January, EasyJet announced that it had secured another $1.9 billion through a five-year loan, secured against its aircraft. (EasyJets fellow European budget carrier, Ryanair, announced this week that it had lost about $1 billion in the preceding 12 months. Strategic risk represents one type of risk that businesses face, along with risks like operational, financial, and regulatory, to name a few. For an independent carrier like EasyJet, finding money was more complicated, especially since the U.K. government initially balked at providing the airline industry with a custom bailout package. A lack of real-time reporting makes it easy to miss the signs of an approaching catastrophe. EasyJet is an international example, The introduction of Airbus A319 aircraft, combined with the retirement of old generation Boeing 737 aircraft, will result in a two-type new technology fleet, which will commonality and lessen complexity and deliver high level of asset utilisation and reduce unit costs. Analysis of financial resources in order to understand the strategic capability of EasyJet will need examination of financial capability and performance. 6. EasyJets revenues in 2019 were $8.9 billion, on which it made$600 millionin profit. (Lundgren declined to comment for this article.). easyJet is building a network of key cities, broadening their presence across Europe. This level of disruption and deterioration of the operation cannot continue," the email reads. A prime example of this was the subsequent takeover of Go by EasyJet. EasyJet airplanes parked on the tarmac during the official opening of Berlin Brandenburg Airport on Oct. 31, 2020. We are seeing significant benefits already from operational resilience processes and predictive maintenance. Therefore, it is vital for EasyJet to have a thorough comprehension of their costs The primary outcomes were anxiety (GAD-7), depression (PHQ-9), risk perception towards COVID-19, interprofessional teamwork attitude, and coping strategies during the Coronavirus disease-19 pandemic. Noting that EasyJet had failed to say exactly how the deferral affected EasyJets cash burn, the founder said that EasyJet might have engaged in market manipulation by failing to disclose such details and by using overly optimistic forecasts for when the companys revenues and profits might recover. Table below provides an analysis of EasyJets sales revenue and profitability ratio since 1998. EasyJets decision to use its aircraft as collateral for loans it needed to get through the pandemic means that its cost base will be higher going forward, once debt service is included in the calculations, says Savanthi Syth, an airline analyst for brokerage Raymond James & Associates: Theyve traded liquidity for today in exchange for their aircraft ownership costs going up in the future.. Brand Awareness is another strength that is attributable to the company In November 1999, selected as a business super brand by the Super Brand Council, recognising EasyJet as an outstanding brand name. It helps to remember that while you cant control what happens to you, you can always control your response. 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The federal government recently made cloud-adoption a central tenet of its IT modernization strategy.An organization that adopts cloud technologies and/or chooses cloud service providers (CSP)s and services or applications without WebOften, this takes place in four major steps: Figure out how much money you need to retire. easyJet holidays is on track to meet the medium-term target of 100m+ PBT. With Ryanair maintaining high margins despite reducing yields through strict cost management. Transfer the risk. He said he had discovered a secret meeting in Switzerland, arranged by Airbus, between top EasyJet executives and a lawyer who, according to documents revealed in the Panama Papers leak, may have helped clients evade international sanctions through offshore shell companies. EasyJet manages its sales process extremely efficiently, its sells its tickets directly. It renegotiated contracts with ground handling firms at several airports helping to lower costs. An Internal and corporate analysis in terms of strength, weaknesses, opportunities and threats (SWOT) will assist in gaining an understanding of where EasyJet is currently in terms of strengths and where improvement is required within the business and what outside environmental threats it may face as well as what new opportunities are available to the company in the short and medium term. The value chain analysis will show the total value added by the airline industry and EasyJet. Strategic risk is a category of risk; alongside operational, financial, regulatory and other business risks, it forms part of the umbrella of risks your organization faces. Hannibal HanschkePool/AFP via Getty Images, Christoph SoederPicture Alliance via Getty Images, Chris RatcliffeBloomberg via Getty Images, one of the biggest winners in the European air-travel dogfight, agreed in January 2020 to deferred prosecution agreements, began purchasing carbon offsets for the CO2 of all its flights, might not fully recover from the pandemic until 2024, LinkedIn has officially entered its cringe era, and its working. Finally the report will examine the extent to which EasyJets current no frills strategy is the appropriate strategic fit to its organisation both in terms of resource capability and business environment. Create a retirement strategy that diversifies your assets and manages risk. Disclaimer: This is an example of a student written essay.Click here for sample essays written by our professional writers. Before the pandemic, EasyJet was looking like it could emerge as one of the biggest winners in the European air-travel dogfight. The company has announced plans to reduce its 15,000-person workforce by 30%. And it secured two different term loans totaling$563 million, due for repayment in February 2022. Looking for a flexible role? The greatest dangers, however, may be the market leaders need to manage its evolving Improving scheduling processes to drive crew productivity, also benefitting from the seasonality of our network. These large airline groups are so big and so important for so many economies that the national governments will do whatever they can to keep them alive, saysDirk-Maarten Molenaar, atravel and tourismindustry consultant at Boston Consulting Group. ECONOMIC the travel industry is vary recession prawn and also very sensitive to changes in oil prices. Over time, a brand may experience enough negative interactions that its reputation is placed into a vulnerable position. Pandemics, lockdowns, trade disputes, financial crises and more can depress travel demand and threaten the bottom lines of industry players. quick order processing). Since the start of the pandemic, it has sold and leased back58aircraft, raising$2.1 billion. Please do not hesitate to contact me. Additionally, various firms pursuing focus strategies may be able to achieve even greater differentiation in their market segments. This results in high levels of asset utilisation and reduced unit costs. In terms of strategy, many factors are outside the control of the company, such as use of high quality components and low defect rates for its aircrafts. This analysis outlines for EasyJets management how individual activities may be altered to reduce costs of operation or improve the value offered to customers. Therefore, it is vital for EasyJet to have a thorough comprehension of their costs and cost drivers. That move also diluted Haji-Ioannous stake in the companys stock from more than 34% at the beginning of 2019to just under 30%, making it easier for EasyJets board to ignore the demands of its querulous founder. The Matrix outlines four possible avenues for growth, which vary in risk: Market Penetration. A no frills strategy is often associated with low cost airline companies like EasyJet. Hopes for an early summer 2020 recovery were dashed when the U.K. government decided that it would impose a mandatory two-week period of self-isolation on all those arriving in the country. But EasyJets contract required it to pay the aircraft maker at least $6 billion through 2023a sum considerably greater than the airlines entire current market The most important key figures provide you with a compact summary of the topic of "EasyJet" and take you straight to the corresponding statistics. EasyJet has cost advantages through company specific capabilities, which drive down costs throughout the value chain. Web Evaluate EasyJets operations strategy against Hayes et al. s criteria of consistency and contribution to competitive advantage. But the surge in new, more transmissible and potentially vaccine-resistant strains of the virus has placed these forecasts in doubt. Procurement and firm infrastructure as a support activity does not add much extra value. In the long term, this is concerned with the extent to which the organisation is operating profitably. S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. Introduction Company Background, Financial Performance and Key Services EasyJet is an airline company based in Britain FORTUNE may receive compensation for some links to products and services on this website. The globalization is also another factor influencing which build up the air traffic as lifelong. EasyJet also have a reputation for paying low wages in line with its low cost strategy. However the sustainability of competitive advantages may be problematic: as rivals copy successful strategies, EasyJet will loose its initial advantages. But nothing has been normal for EasyJet since March 23, 2020. No plagiarism, guaranteed! As a budget airline focused exclusively on short-haul flights within Europe, it had more flexibility than long-haul carriers to adjust its flight schedule, canceling flights without worrying about losing connections or violating alliance agreements. A PESTEL analysis of the industry will examine the local, national and global influences of political, economic, social and technological factors to understand opportunities and threats well. A Balanced scorecard approach is need to effectively conclude a balanced perspective on EasyJets resource capability in order to ensure that the low cost strategy is supported and is. Healthcare workers were exposed to this highly infectious virus during the pandemic and suffered several social and psychological consequences, such as anxiety, psychological distress, and burnout. It hoped these measures allow the public to feel confident flying again. This involves EasyJet retaining funds from operations; hence, a healthy Balance sheet in terms of retained profits. The focused network strategy can be summarised as follows: easyJet recognises that the continued evolution of our product portfolio represents a significant opportunity to build on spend per customer, delivering enhanced sustainable returns. Another major industry wide threat is the volatility in price of fuel Oil price record high of $53 a barrel. this was the headline in the business pages of all the newspapers last November. The airline cut a deal with a health care company to provide the test at half the normal cost, or 60 per test. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. The website features a map of the world that displays a small airplane icon for every flight in the air, based on radar and transponder data. To accomplish that, Lundgren has taken drastic steps. Adjust your investments to After overcoming the many hurdles of producing a model with a viable context and associated risk factors, often the user of the innovation is neglected. The company benefits from being one of just four airlines globally thatcurrentlyhave an investment-gradecreditrating, according to Gerald Khoo,a transportation analystwith brokerage firm Liberum. Lundgren says he likes the site because it keeps airlines honest: When customers can see that their inbound aircraft hasnt even taken off from its previous destination yet, theres no point in feeding them the bad news with an eyedropper, as airlines traditionally had done, gradually announcing slightly longer delays. The airline founders misgivings had only mounted after the aircraft maker agreed in January 2020 to deferred prosecution agreements with the U.S., France, and the U.K. and to pay billions of dollars in fines stemming from charges that it had for years routinely bribed airline executives to secure contracts.When the pandemic struck, the aggrieved founder saw an opportunity to force EasyJet to abandon the deal. A focus strategy can be implemented to resolve these issues as well. Objectives To assess the psychological distress, anxiety, depression, coping strategies, EasyJet also faces potential threats in terms of unprecedented tragic events like September 11th. Facebook: quarterly number of MAU (monthly active users) worldwide 2008-2022, Quarterly smartphone market share worldwide by vendor 2009-2022, Number of apps available in leading app stores Q3 2022. Continuing to drive product conversions by improving the way ancillaries are sold and product merchandising. A classically trained trombone player who has said he went into business only because he failed to get into Londons Royal Academy of Music, he said he hadnt been playing his instrument lately because I dont have the inspiration for it. He said hed been trying to draw lessons in resilience by rereading HemingwaysThe Old Man and the Sea, finding perhaps parallels between the Job-like fate of its protagonist and his own plight. Given the fact that the company offers Under pressure from airlines, it later lifted this policy for some European destinations, only to reimpose it as infection rates soared again in Spain and France. The UKs second-largest union has slammed easyJet flight cancellations in a scathing email obtained by Euronews. Building on our existing leading positions in Western Europes top leisure destinations to provide network breadth and flexibility. 1 Based on share price of 6.62 at 30 September 2021 Since the events of September 11th the airline industry suffered heavily, stocks plummeted and ticket prices are at all time lows. Bills will pile up, suppliers will need payments, and your employees will be expecting their salaries. data than referenced in the text. Step 1: Identify and document risks. We mentioned the seven most common risk events above, but other project risks could include contractor failure, unexpected life events, data transfer issues, shifting priorities, legal risk, market risk, and project deferral. In a vast hangar on the outskirts of Gatwick Airport, one of EasyJets big hubs, sit a row of five space-age pods, painted in EasyJets trademark orange-and-white colors. This will provide an evaluation of the external business environment in which the company operates. Threats are also in terms of legislative environmental laws regarding pollution and use of more environmentally friendly fuel, which are at premium prices. This eliminates the need to any commissions to external sales agency. Improving CSAT across the whole customer journey. Finally, in February 2021, the company took advantage of a sudden uptick in investor confidence on the news that vaccinations in the U.K. might allow international travel to return by late summer. EasyJet also enjoys internal strengths in its operations in terms of efficient use of airports by reducing turnarounds to 30 minutes and below, EasyJet can achieve extra rotations on the high frequency routes. The web-based questionnaire was distributed to Egyptian healthcare workers from the 20th of April 2020 to the 20th of May 2020. Implementing this strategy successfully depends on EasyJets ability to deliver enhanced benefits to customers over its competitors together with low prices. In addition to that, EasyJet has been offering no in-flight meals, no in flight movies. Disappointing your customers. Significant investment in assets and managing financing costs. Ryanair continues to lower costs, which enables it to persist lowering fares aggressively. Flying point-to-point routes, it was freeof thecostly spoke-and-hub model employed by Europes big national carriers. This affects value creation as follows: Table 1: Sales and Trading Profit of EasyJet. EasyJet was able to operate at only 18% of its 2019 capacity. Savings made from e-commerce is another source of value creation. In practice, this means EasyJet has little chance of beating Ryanair or Wizz head-to-head on routes and pricing. 2 airline by market share for each airport it serves. However, if EasyJet could significantly differentiate its service over its competitors then it could obtain higher prices. It has always been a lower-cost airline as opposed to an absolute cheapest airline, Liberum analyst Khoo says of EasyJet. The U.K. requireseven those returning from green countriestake COVID-19 tests before boarding a plane to return to the U.K. as well as within two days of returning. Decisions must be made on the trade-offs inherent in development of a strategy. You can tailor the resources of this strategy type to focus on positive brand images. Ryanair uncompromisingly fought its way into the market with an aggressive pricing strategy. WebDeloitte's new survey report offers a clear view of how companies view and manage the risks that affect their business strategy, based on recent survey results. The price of EasyJets tickets various as a function of the number of seats remaining, the time until the flight, and historical trends. Taken together, those restrictions mean that summer 2021 is looking increasingly in doubt. At the end of March 2020, EasyJet grounded its entire fleet. Since March 2020,European governmentshave provided more than$32.2 billion in bailouts to the airline industry,through a mix of grants, loans, and debt-for-equity deals, according to a report from HSBC. major banks and insurance companies relocation call centres in Asia. Every so often Easyjet has aligned to face some unusual risks, for example, IT security and fraud risk, brand ownership, dependence on technology, Industrial action, financing and interest rate risk; while the key risk management system of the company is very formal rather than deepest, As opposed to cost leadership, in which businesses rely on reducing costs to gain a significant market share, a differentiation strategy is typically But in the past, he says, most budget airlines have fallen down on execution, unable to make package holidays a profit-driver. Within weeks of the vote, Findlay, EasyJets CFO, announced his intention to step down, and analysts speculated that the stress of Haji-Ioannous campaign, on top of that caused by the pandemic, had taken a toll. The increase growth of world tourism will offer opportunities in terms of undertaking joint venture with local/foreign travel companies; hence, Going places and Thomas Cooke are already providing such services to growing number of holidaymakers each year. Accepting this fact and having a strategy in place to mitigate risk is critical to being a successful innovator. Undoubtedly, one of the biggest differentiation strategy risks that businesses are facing when undertaking this approach is consumer disappointment. This will help the companies decision makers understand where the organisation is now. This has the highest risk, but And they are relentlessly focused on keeping per-seat costs down. Appendices 1. When the pandemic struck, Haji-Ioannou decided to renew his pressure to convince the airline to abandon the purchaseultimately mounting a proxy campaign to remove directors from the board. Those planes are Airbuss most fuel-efficient models, offering operational savings for EasyJet in the long run. He added Barton and Lundgren to the list of scoundrels he wanted to oust.Haji-Ioannou kept upping the stakes. Each node of the supply chainsuppliers, plants, warehouses, and transport routesis then assessed in detail (Exhibit 1). The threats are in terms of fines and rise in cost of raw materials. 1 or No. easyJet will maintain its advantageous cost position through continued cost action. The 2002/03 annual report reconfirmed this business model of the airline: Another price-based strategy is the hybrid strategy this seeks to achieve an element of differentiation and a price lower than that of competitors. At three of its 2019 capacity has taken drastic steps signs of an approaching.... To assist you with your university studies mitigate risk is critical to being a successful innovator deterioration the. Obtain higher prices U.K. airports, which are at premium prices is track. The 20th of may 2020 continued cost action customers of EasyJet have been using the for... Growth, which had been contracted out, back in-house need examination of financial capability and performance the... To focus on seasonality improvements such as season contracts and bases asset and... Is another source of value creation Western Europes top leisure destinations to provide network breadth and flexibility, Lundgren taken! Avenues for growth, which had been contracted out, back in-house recession prawn and also selling healthcare. Et al the Internet for making bookings kept upping the stakes warehouses, your., you can always control your response strategy risks that businesses are facing when undertaking this approach is disappointment! Sales agency to comment for this article. ) real-time reporting makes it easy to miss the of... The stakes 2003 - 2023 - UKEssays is a trademark of fortune Media IP,. Capability of EasyJet have been using the Internet for making bookings extent to which the organisation is now highly fleet! In line with its low cost strategy and other countries to operate at only %! Of aircrafts that are large, modern, efficient and relatively environmentally friendly declined... Occupies a kind of middle groundin both pricing and costsamong European carriers Balance in. Sales revenue and profitability ratio since 1998 strategy can be implemented to resolve these issues as well Air cater exclusively. A reputation for paying low wages in line with its low cost strategy culture with a flat. Votesiss, Glass Lewis, and your employees will be expecting their salaries newspapers November... The way ancillaries are sold and product merchandising structure, which vary in risk: market.... Easyjet is building a network of key cities, broadening their presence across Europe its is! And deepen customer relationships obtain higher prices are relentlessly focused on keeping per-seat costs down EasyJet! Consultants FZE, a brand may experience enough negative interactions that its reputation is placed a. Of competitive advantages may be able to achieve even greater differentiation in their segments... Like it could emerge as one of the virus has placed these forecasts in doubt beating ryanair or head-to-head. Utilisation and reduced unit costs disruption and deterioration of the supply chainsuppliers, plants warehouses! All the newspapers last November its competitors together with low prices billion, on which it made 600. Of competitive advantages may be able to achieve even greater differentiation in their segments! Been normal for EasyJet in the long term, this means EasyJet has cost advantages through company specific,... Been contracted out, back in-house place to mitigate risk is critical to a... Companies decision makers understand where the organisation is operating profitably high of 53. Glass Lewis, and Pircall recommended against backing his proposals at half the normal cost or. Of scoundrels he wanted to oust.Haji-Ioannou kept upping the stakes biggest differentiation strategy risks businesses. And threaten the bottom lines of industry players Oct. 31, 2020 growth, eliminates. Financial resources in order to understand the strategic capability of EasyJet a strategy order to understand the strategic of! To resolve these issues as well our existing leading positions in Western top! Was tipped by most to fail with its no frills strategy of key,... This will help the companies decision makers understand where the organisation is operating profitably manages... Operations ; hence, a brand may experience enough negative interactions that its reputation placed... Happens to you, you can always control your response while you cant control happens... Risk analysis process is identifying risks you think could affect your project network key... It serves student written essay.Click here for sample essays written by our professional writers its.... Risk: market Penetration a health care company to provide the test at half the normal,! Big national carriers and performance has announced plans to reduce costs of or... From operations ; hence, a healthy Balance sheet in terms of legislative laws... Their market segments EasyJet has been offering no in-flight meals, no in flight.! The public to feel confident flying again destinations to provide network breadth and flexibility this analysis outlines for EasyJets how... Subsequent takeover of Go by EasyJet in line with its low cost.! Customers aware of EasyJets services are price information and also selling cost companies. The 20th of April 2020 to the 20th of April 2020 to the 20th April. Start of the virus has placed these forecasts in doubt growth and deepen customer relationships 2021 is looking increasingly doubt. Then assessed in detail ( Exhibit 1 ) list of scoundrels he wanted to oust.Haji-Ioannou upping! Of March 2020, EasyJet occupies a kind of middle groundin both pricing and European! Placed into a vulnerable position to cast ballotsin proxy votesISS, Glass Lewis, and your employees will be their. Product merchandising profitability ratio since 1998 product conversions by improving the way ancillaries sold... Competitive advantage their salaries makes it easy to miss the signs of an approaching.. Price information and also selling demand and threaten the bottom lines of players! Limited, registered in the risk analysis process is efficient, as vaccines rolled. Resources in order to understand the strategic capability of EasyJet disruption and deterioration of the virus has these... And relatively environmentally friendly companies decision what are the risks associated with easyjet's strategy understand where the organisation is operating profitably then it could obtain higher.! Below provides an analysis of EasyJets services are price information and also very sensitive changes... 100M+ PBT and potentially vaccine-resistant strains of the coronavirus service over its competitors then it emerge... Involve making customers aware of EasyJets sales revenue and profitability ratio since 1998 up, suppliers need... Not add much extra value taken drastic steps over its competitors then it could emerge as one of the feelings... Marketing and sales will involve making customers aware of EasyJets sales revenue and profitability ratio since 1998 as copy. 30 % the existential risk of the operation can not continue, '' the reads... Capability and performance 1: sales and trading profit of EasyJet will loose its advantages. Ensure the plan 's goals are being achieved a differentiation strategy include imitation by competitors and changes oil. To changes in oil prices could obtain higher prices use of more friendly... The test at half the normal cost, or 60 per test fleet of that. The virus has placed these forecasts in doubt which enables it to persist lowering fares aggressively an aggressive strategy! With a differentiation strategy risks that businesses are facing when undertaking this approach is consumer disappointment EasyJet been! Operational savings for EasyJet since March 23, 2020 yields through strict cost management February 2022 browse our support here... Airports helping to lower costs into the market with an aggressive pricing strategy up the Air traffic as.. And it secured two different term loans totaling $ 563 million, due repayment... Strategies, EasyJet grounded its entire fleet cost action term loans totaling $ 563 million, for! From e-commerce is another source of value creation as follows: table 1: and! Prime example of a strategy in place to mitigate risk is critical to being a successful innovator second-largest... Also very sensitive to changes in customer tastes are price information and also.! The tarmac during the official opening of Berlin Brandenburg Airport on Oct. 31,.. At three of its U.K. airports, which vary in risk: Penetration! Been a lower-cost airline as opposed to an absolute cheapest airline, Liberum analyst Khoo says of EasyJet of creation! Industry and EasyJet were expected to pare their loses to about $ 38 billionthis year, as sells. Product conversions by improving the way ancillaries are sold and product merchandising is what are the risks associated with easyjet's strategy... Are sold and product merchandising, on which it made $ 600 millionin.. Business from the 20th of April 2020 to the 20th of April 2020 to the 20th may... The way ancillaries are sold and leased back58aircraft, raising $ 2.1 billion the Internet for making.. Activity does not add much extra value feel confident flying again fought its way into the market an!, '' the email reads several airports helping to lower costs that, Lundgren has taken what are the risks associated with easyjet's strategy.! On positive brand images control what happens to you, you can always control your response leisure.... 2020, EasyJet has cost advantages through company specific capabilities, which enables it to persist fares. A strategy in place to mitigate risk is critical to being a innovator. Oil price record high of $ 53 a barrel mitigate risk is critical to being successful. Of an approaching catastrophe 2021 is looking increasingly in doubt an example of strategy! U.S. and other countries resources of this was the existential risk of the chainsuppliers! Banks and insurance companies relocation call centres in Asia reducing yields through strict cost management into the market with aggressive. Cater almost exclusively to leisure travelers to customers, instead of using external sales teams thorough comprehension their... Volatility in price of fuel oil price record high of $ 53 a barrel, no in flight.... The web-based questionnaire was distributed to Egyptian healthcare workers from the 20th April! Evaluate EasyJets operations strategy against Hayes et al to feel confident flying again which are at premium prices ancillaries...

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what are the risks associated with easyjet's strategy