Capacity Control in Revenue Management

Revenue Management stands for one of the most successful fields of application where operations research is applied and which originates in the airline industry. It consists of a method mix of demand prognosis, price differentiation and capacity control. In literature and above all in practice numerous approaches for capacity control in passenger transportation have been developed by airlines. A comparison of such approaches with respect to their quality has so far been carried out only to a limited extent. For this reason, a simulation environment has been created in JAVA which permits such comparisons under uniform frame conditions. It thus becomes possible to apply existing procedures to an extended range of problems such as arise in freight transport, sale of package tours or car rental. Furthermore, alternative mechanisms of control have been developed which are not based on a certain number of products to be sold, but instead on minimum prices for using the required resources which can be designated as opportunity costs.