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Chapter 1 1.

1 Introduction

1.1.1

The Domestic Aviation Scenario in Bangladesh

According to the data provided by Bangladesh Biman, in 1972 it flew nearly 337,000 passengers in the domestic sector and 367,000 passengers in the year 199 , which is rather a stagnant fig!re" #!ch was the case beca!se, the domestic aviation ind!stry of Bangladesh failed to gain the pop!larity or reliability of its passengers, d!e to infre$!ent flight, inferior standard of service and lac% of s!pply" &h!s people were forced to !se alternative forms of transport s!ch as b!ses, trains and other private transport, which was $!ite inconvenient, when time sec!rity and comfort were considered" B!t after the introd!ction of other private sector airlines since 1996 and '(' Airlines in the year 199 , the n!mber of domestic air travelers has increased rapidly, as this company was s!ccessf!l in catering to its c!stomers needs" B!t it still remains a fact that the latent demand for air)travel has not yet reached its f!ll potential"

1.1.2

Company Overvie

!"! group #ac$ground '(' 'ro!p was formed in the year 19*6 as a conglomerate of man!fact!ring companies" Altho!gh, it started as a small to medi!m)si+ed, conservative gro!p of primarily man!fact!ring firms, '(' was the first te,tile dyeing and finishing !nit of Bangladesh in the year 19*7" -t was also the first steel re)rolling plant, year 19* , and the first and c!rrently the largest ra+or blade man!fact!ring !nit of the co!ntry, which was established in 19* " 1.1.% The &ormation o& !"! Airlines 'td.

-n the year 1997, the 'overnment of Bangladesh advertised f!rther dereg!lation of the Airlines ind!stry of Bangladesh by inviting applications for license for f!ll domestic airline operators" &wo years prior to this dereg!lation, the 'overnment for the first time dereg!lated the airline ind!stry by allowing smaller . air ta,i. or #&/0 1short ta%e)off and landing2 type operation" '(' Airlines, which is one of the company of the '(' gro!p, retained a well) %nown 34 based cons!ltant 5eil 6ansford to st!dy the opport!nity in depth and to help '(' implement the b!siness plan" 6ansford provided the m!ch desired ind!stry) specific %nowledge" '(' Airlines also f!rther benefited by the fact that the (anaging 7irector and the 8hairman were both trained and well $!alified commercial pilots and played a vital role in the form!lation of the b!siness plan" After a thoro!gh research and a satisfying and materialistic b!siness plan, attention was diverted to overcome the ne,t cr!cial step, which was the financing for the aircraft and other infrastr!ct!re necessities" B!t '(' was s!ccessf!lly able to raise 91 million worth of finance in the form of an operating lease of three aircraft" &h!s in the /ctober of 1997, '(' signed the aircraft leases 11 million 3# dollars2 with Bombardier :egional Aircraft 7ivision, where, the owners of the '(' gro!p provided the e$!ity and the local Bangladeshi Ban%, provided the wor%ing capital" &h!s '(' Airlines started with its maiden ;o!rney in April , 199 and has been contin!ing s!ccessf!lly, ever since" '(' Airlines positioned itself as a premi!m airline with the corporate mission of providing . <irst 8lass all the way. service to its c!stomers"

1.1.%.1 Organogram

CHAIRMAN MANAGING DIRECTOR DIRECTOTR


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DIRECTOR

Director Flt Operations

Director Engineering

Director Admin !ec"rit#

Director Mar$etin g sales

Director
Commercial %Internation al operation&

Director A"dit

GM' (rod"ction

GM' Admin

GM' Gro"nd !er)ice

GM' %F A& GM' (roc"rement

1.1.(

Mision-

&he (ision /f '(' Airlines is dedication to the highest $!ality of c!stomer service delivered with a sense of warmth, friendliness, individ!al pride and company spirit" Objective&o provide better service to the val!ed c!stomer beyond their e,pectation, cater to all their needs within company r!les and inform the c!stomers if any delay and cancellation of flight"

Strategy &o achieve their ob=ective, they are following one of >orter?s generic strategies of

Differentiation. &hey have maintained sched!led time for flights and good relationship with the c!stomers, which is the main reason behind their s!ccess" @ven tho!gh the fare is higher than B-(A5, people still prefers '(' beca!se of the $!ality of service"

Policies &he policies of '(' Airlines were form!lated, %eeping in mind to attain c!stomer loyalty of present and potential c!stomers" #o far '(' has been s!ccessf!l to establish its image in both the corporate and the commercial world, which has res!lted with achieving A0B of the domestic mar%et share in the aviation ind!stry of Bangladesh" As, established in the aviation ind!stry, c!stomer loyalty grows right before the service is !nderta%en" Altho!gh '(' believes that it already has its own spectr!m of loyal c!stomers, b!t is also aware of the fact that this fig!re has to be maintained and sho!ld be increased as well in order to have the competitive edge against its competitors"

Chapter)2 2.1 Current *outes


'(' c!rrently flies nearly 32 flights everyday, with its two 7ash) , with an average landingCand, ta%e off every half an ho!r" -t has an average of at least 2 offices in all the mentioned cities" &he s!mmary of the c!rrently followed sched!le is as follows)

Destination
+To , &rom Dha$a8hittagong #ylhet ;essore Barisal

Distance

Sectors &lo n Bloc$ Time A* A0 3* 30 /er day

.autical "iles
123 106 79 66

6 6 2

2.2

"ar$et /ositioning

'(' Airlines has been s!ccessf!l in positioning itself as a premi!m airline with the corporate mission of providing .<irst 8lass All the Day. service to its val!ed c!stomer" '('.s .first)class. positioning and commitment to $!ality service is reminiscent of the . ;et Airways. model in -ndia" -n order to live !p to its corporate philosophy and the ass!rance provided to the c!stomers, '(' too% all relative decisions %eeping in mind to stand distinctively amongst its c!stomers in order to establish the desired image in the ind!stry" #ome of s!ch decision to materiali+e the . <irst 8lass all the Day. image, were) '(' chose the t!rbo)prop aircraft with the proven trac% record of 99"3 B dispatch reliability 1the 7e6avilland 7ash) 2" &he company chose to adapt @!ropean standards of @ngineering confirming to the ;A: 1A* standard and bro!ght e,patriate engineering contractors to f!lfill the re$!irements" '(' b!ilt its own infrastr!ct!re, both in sales and in airport locations thro!gho!t the co!ntry to ens!re the $!ality of service that was promised to the c!stomers" '(' selected the finest candidates and trained them to international standards" '(' introd!ced the BAB# worldwide reservation 1p!rchased from British Airways2 to provide efficient reservation domestically and to tap the potential of selling domestic seats from anywhere in the world"

2.%

!"! Airlines0 /er&ormance

#tarting with 1,100 passengers in the first month, '(' s!ccessf!lly carried nearly 19,000 passengers in the twelfth month E carried nearly 200,000 passengers from ;an!ary to 7ecember 1999" '(' also managed to drive !p the ind!stry yield to !nprecedented levels, forcing the national carrier to red!ce its s!bsidies in the main 8hittagong E #ylhet sectors" &he n!mber of passengers, flights and load) factors has all e,ceeded the original b!siness plan e,pectations" +

To provide a sa&e and relia#le 1ourney /ver its f!nctional years, passengers has been able to rely on '(' Airlines. promise of a safe and comfortable =o!rney, than%s to its aircraft, which is !sed by more than seventy top operations all over the world with a dispatch reliability of 99"3AB" -n order to f!rther ens!re the proper and reg!lar maintenance they have an agreement with a #cottish firm %nown as 8aledonian Airborne" Beside that a considerable n!mber of engineers, both Bangladeshi and foreigners, are engaged in ho!rly and ro!tine chec%)!ps of the aircraft and management sees to it that they are followed very strictly" '(' is also in a contract with another rep!ted company for its s!preme engineering division" 2.( Interline Connection

Bangladesh Biman.s analysis of domestic traffic shows that the ma=ority of passengers travelling on domestic ro!tes are act!ally passengers connecting from its own international flights" &h!s '(' started to foc!s on the passengers who travel in other -nternational flights other than Biman" &h!s, '(' has ta%en f!ll initiative to capt!re these large p!lls of passengers who are also destined for domestic destinations" 8omp!teri+ed reservation system and c!rrent interline agreements with British Airways, @mirates, #ingapore Airlines, Fatar Airways, 4!wait Airways and #a!dia, &hai and some other -nternational Airlines, has helped '(' Airlines to ta%e f!ll advantage of the sit!ation" As a res!lt, incoming passengers can now have their baggage tagged to their final destination" 2.2 Decision)ma$ing process

-n case of any ma=or decision regarding, resched!ling, cancellation or delay of any flights, the decision ma%ing body brief the sit!ation to the (anaging 7irector and then he decide f!rther actions and decisions accordingly" &he ma=or decision)ma%ers are as followsG ) 7irector <light operation 7irector @ngineering

7'(1 'ro!nd #ervice2 (anager #ales

2.5.1

Information Delivering Process:

Decision .rom committee Concerned !ales (erson

Asst Manager % /one 0ise& Co"nter !"per)isor Co"nter !ta..s

C"stomer !er)ice

Reser)ation Manager Reser)ation O..icer

&he message that is delivered is standard for each and every staff of '(' Airlines, and this message is than conveyed to the passengers of the respective flights"

2.3

*esponsi#ilities o& the head O&&ice)

Manager Sales:egarding any cancellation or delay of flights, the head of sales 1!s!ally the manager sales2 is contacted and the !pdated flight position is confirmed" #ometimes, depending on the load factors, flights are red!ced or combined, to avoid delays" Dhen any cancellation message is received, the sales department is responsible for preparing a revised sched!le considering all related aspects"

And this message is f!rther circ!lated in every stationCco!nterCdepartment" -n case of the absence or the !navailability of the sales manager, the assistant managers informs to the co!nter s!pervisor abo!t the flight stat!s, and coordinates and follow !p the sit!ations" Reservation ManagerAfter receiving any message from #ales department regarding flight and other related matters, the reservation !pdates sched!les, collect data regarding passenger load" >rompt decision is re$!ired in this matter, as the passengers need to be transmitted to the ne,t available flight, or provided with any other alternative sit!ations according to their preference" 7oc!mentation of all s!ch sit!ations are %ept in files for f!t!re reference" Supervisor #!pervisor follows the instr!ction of Asst" #ales (anager and transfers the message to the passengers 1by telephone or e)mail n!mber that was recorded while boo%ing2 with the help of the co!nter colleag!es" &he co!nter staffs are instr!cted to disc!ss with their s!pervisor in case of any critical or !n!s!al sit!ations and carry o!t the tas% according to instr!ction"

4ngineering Department
&his department is one of the important departments of '(' Airlines as it is in charge of maintenance of the aircraft" &herefore, if this department fail to e,ec!te their d!ties properly, the service of other departments will go in vain" &he interior of the aircraft, its seat covers air)conditioning and cleaning, is also monitored by this department" -t is also the responsibility of this department to inform the #ales and :eservation 7epartment in times of technical diffic!lties faced by the aircraft and the estimated time that will be re$!ired to fi, the problems"

Chapter)% %.1 S5OT Analysis

Altho!gh '(' Airlines 0td is comparatively new company in the ind!stry, it has been $!ite s!ccessf!l in ma%ing its e,istence prominent" By starting in the domestic arena it has grad!ally driven itself to the international arena starting to cond!ct direct flights in the 8hittagong)4ol%ata)8hittagong ro!te" &his has been possible for its strong presence in the ind!stry and for the long)term goal and e,pectation of the top)level management and also beca!se of the s!pport from the employees of all level" '(' made a good !se of its image and pl!nged into action as soon as the policy was reformed on their accord" Strength A company, image that portrays establishment and s!ccess &op level management e,pertise, who has the %nowledge and e,perience to provide the company with what it needs to establish its name in the -nternational arena" -ts s!ccessf!l presence in the domestic aviation ind!stry -t?s s!ccess in the pac%agesC prod!cts that has been available so far 8omp!teri+ed networ%ing system BAB# 1for domestic flight reservation2 8omp!teri+ed networ%ing system Amade!s 1for -nternational flight reservation2 -t is the only s!rviving private Airlines 8ompany in Bangladesh" 6as s!ccessf!lly established interline agreement with some of the ma=or -nternational Airlines company" 6as a competitive fare system in all the c!rrent sectors" #trives to maintain flight sched!les, as long as it does not get serio!sly hampered by e,ternal factors which are beyond their control"

(aintains a strong corporate connection and liaison in order to maintain and increase the spectr!m of their clientele" 6as been maintaining an efficient boo%ing, tic%eting and ref!nding system in order to gain the confidence and reliance from the c!stomer"

Weakness /ver the last years, '(' has introd!ced different prod!cts in order to attract wider range of mar%et, altho!gh some of them were s!ccessf!l, b!t some of them co!ld not attract attention of the common citi+en, d!e to the lac% of aggressive promotional activity" Altho!gh the company can ta%e pride in anno!ncing that they r!n a highly efficient and effective wor% force, some of the mid level employees feel de) motivated as they feel that they are not provided with the opport!nity of growth and sometimes their contrib!tions and wor%s are not properly recogni+ed" As soon as an empty position is recogni+ed, necessary steps are not ta%en as $!ic%ly as it sho!ld, to f!lfill that empty position" &h!s, other staff has to cond!ct that wor% for the time, which red!ces the efficiency and hampers the proper f!nctioning of the entire department" Opportunity -n general, the private sectors of the co!ntry always face the diffic!lties of policy str!ct!re and their implementation" &he Airlines ind!stry is not beyond this diffic!lty and sometimes has to ta%e certain initiatives to reform these policies and reg!lations" Bangladesh Biman has been acting as the policy ma%ers of this ind!stry, and has retained the private sectors from cond!cting -nternational operations for $!ite a long time, for reasons !n%nown" B!t, !nfort!nately, the Biman itself failed to !phold the co!ntry image and add significant contrib!tion and improvement to the ind!stry, and lost many b!sinesses to the other renowned -nternational Airlines companies which have been r!nning $!ite s!ccessf!lly in this co!ntry" &h!s only recently private sectors have been allowed a small b!t significant e,pos!re into the -nternational arena"

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'(' can ta%e f!ll advantage of this sit!ation by establishing a firm gro!nd in the -nternational sector as it has already done in the domestic mar%et" /ver the recent years, co!ntries have been trying to gain attention and attract foreign mar%ets by investing on their to!rist spots" &h!s the Airlines company can ta%e f!ll opport!nity of the sit!ation and cater to different mar%ets by offering differentiated pac%ages 1'(' has been offering pac%ages with the help of their interline agreements2 of their own" &his will enhance their prominence and add to their competitive advantage"

Altho!gh, the overall economy of the co!ntry is at a dire state, a certain sector of the pop!lation has been maintaining their position in the society with a higher position in the affordability scale" &hese sectors has always been a target for the Airlines company and '(' Airlines can also =oin the trend by trying to gain their attention by offering different benefits that might aro!se their interest"

Threats >olitical instability of Bangladesh has long since been hampering the smooth r!n of Bangladesh, affecting each and every sector of the co!ntry" &his contin!es to be a threat and all the ind!stries as well as the Airlines, have mastered their own ways to deal with this contin!ing and everlasting crisis" As the government changes and new a!thority comes into position, there is an ongoing trend of changing the r!les reg!lation and policy of the previo!s government" &herefore, the ind!stry always r!ns the ris% of policy reformation that might not go in their favor" >artic!larly, the Airlines ind!stry is s!sceptible to changes that are beyond their control i"e" the weather, specially, in a tropical co!ntry li%e Bangladesh where rain always hamper a reg!lar flight sched!le"

3.2 GMG Holidays

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&hro!gh the path of the establishment of '(' Airlines, '(' gro!p felt the need of establishing a travel agency, which will provide all %ind of travel related service to the corporate world as well as for the general citi+en" Dith this motto, '(' 6olidays 0td" was established as a corporate associate of '(' Airlines" -ts primary foc!s was to offer and promote pac%age to!rs in Bangladesh" 0ater, with the =oint collaboration with 6oliday 5epal, it introd!ced 5epal pac%age to!r by the end of the year 1999" /n ;an!ary 3, 2000 '(' 6olidays 0td" registered itself !nder the (inistry of 8ivil Aviation and &o!rism as a f!ll)fledged &ravel Agency" 0i%e their corporate associate, '(' 6olidays promises to its val!ed clients to provide smooth, comfortable and convenient travel arrangements for its clients where the service is . <irst 8lass All the Day."

"ission
'(' 6oliday.s mission is to create revol!tion in the travel ind!stry of Bangladesh by offering the best of the best services in every aspect of the travel service" &hey also wish to provide to all in bo!nd as well as o!tbo!nd travelers of Bangladesh all %ind of possible travel arrangements in terms of air tic%ets reservation, hotel E transportation reservation as well as pac%age to!rs in best possible manner where $!ality matches with performance"

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Chapter)(
(.1 Contri#ution o& Agency Sales &ravel Agency sales have a ma=or infl!ence on the s!ccess of '(' Airlines" &he following table is the sales record of '(' Airlines and performance of travel agencies from 5ovember 9 till ;!ne 2000"

"onth .ov 78 Dec 78 ;an 77 <e# 77 "ar 77 Apr 77 "ay 77 ;un 77 ;ul 77 Aug 77 Sep 77 Oct 77 .ov 77 Dec 77 ;an 99 <e# 99 "ar 99 Apr 99 "ay 99 ;un 99 Total (.2 The /ro1ect

Total Sale in 12%92993 291(9%89 17222397 17::3289 22288172 2(9129%8 29(82:(: 2192:782 21788888 217999%: 2%:3822% 237(:%(: %19:2(7% %1281988 %2373711 %91:38:7 28129(92 2:(%2938 2:2(8381 238212%2 (72198813

Sales &rom Travel Agents 1::89(2 181287: 13::1:9 1797(77 2(:7922 1888227 12%2337 2212923 %922199 2(922:1 87:9(8 288(983 %2(:%82 %2%:127 %121791 873:8: %2782:( 2%38:1: 2217281 1:7327: (732(93%

6 o& Total Sale 126 76 76 196 196 86 :6 116 1(6 116 126 116 116 116 196 196 1%6 76 86 :6 196

Introduction
Dith the ina!g!ral flight on September 8, 2004 '(' Airlines has started cond!cting -nternational flights in the 8hittagong)4ol%ata)8hittagong ro!te from September 11, 200A" 5evertheless, as going into international destinations with their own crafts, is entirely new to them, in order to predict the reaction of the clientele, and to ded!ce the possible s!ccess of this branch, a st!dy has been performed to envisage the possible f!t!re" 13

(.2.1 O#1ective o& the study

&o determine and !nderstand, the Airlines selection pattern of the Bangladeshi 5ationals, who !se -nternational Airlines for their desired p!rposes, and, how can '(' participate in the -nternational sector"

7evelop a profile of '('?s prospective regional air travelers" 3nderstand the Bangladeshi -nternational travelers choice and preferences, in their carrier, and what does these choices depend on" &o determine the factors that drive -nternational travelers to choose a partic!lar -nternational carrier" 'eneral traveler?s perception abo!t the local carriers of Bangladesh and what contrib!tions can '(' Airlines ma%e to improve the sit!ation"

<oc!sCAreas of st!dy
<orecast of the response that will be generated from this new prospect 1Based on '('?s previo!s rep!tation and perception of people2" Appeal of these -nternational destinations 14atmand!, 8olombo, (ale, 8hennai, 4ol%ata, Ban%o%, 4!lalamp!r, 7!bai 2 to '('?s target mar%et" Also, %eeping in mind the aspect of the Airlines, on which people give the most importanceCpreference"

"ethodology
6elp from certain proven theories and process, of several branches of (ar%eting has been ta%en, to increase the probability of the s!ccess of the st!dy" A $!estionnaire has been designed which addresses all the iss!es that define the p!rpose of the report" &he $!estionnaire has been circ!lated among 1 * people who agreed to respond to the $!eries that were so!ght"

1*

Drawing Sa ples #amples have been pic%ed, %eeping in mindH '('?s target mar%et in the -nternational flights" -n order to avoid the biased ness of the report, the $!estionnaire were circ!lated among people, belonging to different pools of profession, income and age" 1Dithin a defined bo!ndary2 B!sinessG

-nternational /rgani+ations 7omestic (58 5'/ 1 private organi+ations2 'overnment /rgani+ation

@d!cational -nstit!tions1 privateCp!blic, teachersCst!dents2

'imitations
/nly the Bangladeshi 5ationals are ta%en into consideration" &o!rists, @,patriates and Iisitors from other co!ntries have been ignored"

&he $!estionnaire has only been circ!lated among the citi+ens of 7ha%a 8ity" &he st!dy has been performed by a random selection of 1 * samples, which is a very moderate n!mber, considering o!r pop!lation si+e" Altho!gh, all $!estionnaires were !sed in the statistical analysis, all respondents did not respond to some of the $!estions" B!t, all of them were considered, %eeping in mind that the $!estions they did respond to, were very val!able and will be !nwise to ignore"

/nly the fairly fre$!ent travelers were considered"

(.% An overall idea o& the Airlines Industry o& Bangladesh

1+

&he airline ind!stries worldwide is facing a declining stage beca!se of the terrorist attac% in 3"#" -t ca!sed many airlines to go ban%r!pt and layoff of millions of employees in total" B!t as it is a resilient ind!stry and the global economy needs air transport, this ind!stry wo!ld never decline completely" #ooner or later, it will overcome this crisis, tho!gh the heavy loss occ!rred, may not be totally covered" -n Bangladesh it is at the mat!rity stage and the mar%et is sat!rated" &he competition is intense and local airlines have to compete with foreign airlines" &he barriers to entry are great and the growth of the ind!stry has been slowed down" B!t even when the ind!stry was growing, Bangladesh has been able to ma%e very little contrib!tion in this sector" &he co!ntry has so far failed to address or monitor the reasons that were responsible for this condition" @ven, where problems were identified, proper steps have so far not been ta%en to modify this sector of h!ge potentiality" Before, as no private carriers had the a!thority to fly international flights, the only Airlines that was available for domestic travelers, was the 5ational 8arrier) Biman Bangladesh Airlines" B!t !nfort!nately, it was not possible for them to meet the h!ge demand that was available, and as they failed to grasp the potential, Bangladesh was deprived of some million dollars of foreign c!rrency ann!ally"

(.( /4ST Analysis


Political i pact /ne of the ma=or problem that was identified for the low efficiency and poor standard of the Airlines, was d!e to the government intervention and b!rea!cratic policies that seems to hamper proper e,ec!tion of wor% flow" &h!s, it res!lted in inefficiency and ineffectiveness in the wor% place, a total lac% of control over the policy, which made the entrance of foreign and better competitors m!ch easier" Another point, which is worth mentioning, is that a change in government in Bangladesh almost certainly means a change in the policy beca!se any decision ta%en by the previo!s r!ling party is not acceptable by the c!rrent r!lers" &wo aircraft bo!ght by the previo!s 'overnment were not !tili+ed immediately, beca!se after the change of the 'overnment, the new a!thorities concerned,

1,

wanted =!stification from the c!rrent employees, that why these two new aircraft were needed in the first place" B!t, not only does the government r!n organi+ation s!ffers, the private organi+ation also hesitates to ta%e ma=or decision in fear of a new inappropriate policy reform"

!cono ical
&he overall economical condition of Bangladesh is in a fragile condition where the b!ying power of people i"e the disposable income has been s!ffering poorly" /nly a certain gro!p of people is not as affected by the economy as most of the middle) class or even the !pper middle)class s!ffers" &herefore, people who have often traveled abroad $!ite fre$!ently before, might red!ce the fre$!ency d!e to their loss of disposable income"

Social /nly some years before, people were !sed to travelling by b!s and trains for destinations within the co!ntry" B!t this practice soon changed, as travelling by this methods were $!ite time cons!ming and the need for reaching the desired destinations in minim!m time possible were increasing" &h!s, domestic air travel gained its pop!larity specially amongst the e,ec!tive class who faced the most time constraints" Altho!gh, Bangladesh.s domestic air ind!stry faced little effect after the 9C11 incident, b!t still than the general impact and tra!ma faced by the people of Bangladesh cannot be ignored which might have affected the ind!stry to a smaller e,tent"

Technology -n order to cope with recent developments, organi+ations are getting more technologically so!nd" >assengers can now chec% any flight sched!les and timings from almost any parts of the world" Altho!gh not largely practiced in 1-

Bangladesh, some -nternational flights do have on)line boo%ing system, which has made it very convenient for the passengers" &he local companies !se their own networ% of comp!ters, thro!gh which they can comm!nicate with their other branches, operating at different places, which red!ces the infrastr!ct!re costs" (.2 /orter0s &ive &orces Threat of "ew !ntrants Airlines -nd!stry happens to be a highly capital intensive ind!stry where massive infrastr!ct!re cost is associated" &h!s even if the ind!stry has a high potential, threat of a new entrant is very !nli%ely, beca!se if a company fails to perform within a definite standard with its e$!ipment and service, it has to end!re a high switching cost" 6owever, it is always possible, that an already established international company can ac$!ire the approval of the government to enter into a potential new sector" #argaining Power of suppliers /ne of the ma=or s!ppliers of an Airlines company is its aircraft s!ppliers and the provider of the boo%ing system !sed" -n the domestic region, Biman has been !sing <)2 whereas '(' Airlines !ses 7ash) " 7!e to some !navoidable circ!mstances it has not been possible for either of the companies to change this line of Aircraft" &h!s the bargaining power of these s!ppliers can be considered high, as the switching costs of the Airlines company is high" &he aircrafts are very m!ch differentiated and it is costly for the companies to switch from one s!pplier to another" -t is also noticeable that a company !ses similar %inds of aircraft for all its destinations, as the maintenance cost is less"

#argaining power of #uyers 7!e to the development of information system b!yers are very m!ch familiar to the services that are offered in different Airlines" &herefore, if they are not satisfied

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with the performance of one company, they can easily switch to another one" &h!s the b!yers have a higher bargaining power over the Airlines company" Threat of Substitutes Altho!gh, while travelling within the co!ntry, by road or river, can be an option b!t they are not act!ally regarded as s!bstit!tes" Dhereas, recently, going to 4ol%ata by road or by air can be tho!ght of as s!bstit!tes of one another" B!t still then in other international destinations the only option is by air, where the only s!bstit!te is another company which offers the same preferred destination"

Rivalry &he prod!cts offered by all companies are virt!ally similar in nat!re, th!s e,isting companies face fierce competition by trying to offer something additional to its c!stomers in terms of its services" As they are thriving to ma%e a considerable amo!nt of b!siness in order to s!rvive in the ind!stry, both of the national companies are trying to entertain the e,isting c!stomers as well as attracting additional passengers" (.3 /orter0s Diamond "odel

A brief st!dy of the airlines ind!stry reveals factor con$itions to be a determinant, which is essential for any company to gain a competitive advantage"

Human Resources- 0i%e most ind!stries of Bangladesh, airlines is also a labo!r intensive ind!stry, and where s!rvival or the growth of any company is largely determined by the level of the s%illed employees they posses" &o meet this criterion '(' employees go thro!gh e,tensive training sessions for the post of cabin crew and sales person" &hey also need to be trained to !se the boo%ing systems that are !sed by the organi+ations" Also, s%illed engineers and technicians are re$!ired to ens!re proper maintenance of Aircraft"

Capital- it also happens to be a capital oriented company where h!ge initial investment is re$!ired and the brea%)even point is not attained very soon"

12

De an$ %on$ition &he demand condition fl!ct!ates depending on the c!rrent economic and social conditions" B!t as mentioned earlier, over the last years people are becoming more inclined towards flying d!e to certain social and in some cases economic reformations" Relate$ & supporting in$ustry &he related and s!pporting ind!stries in the airline ind!stry are, travel agencies, hotels, to!rism, etc" Dith the growing !se of online boo%ing system, the travel agencies face increasing threats" -n order to remain in the ind!stry, they have started their own online service" 6owever, with the increasing demand for any to!rist spot accelerates the air travel to that state" As, nowadays, people go abroad to have better treatment facilities as people have lost faith on the health care service of Bangladesh" #o, co!ntries li%e -ndia #ingapore, Bang%o% etc, which provide better medical service within the region, can be attractive ro!tes for the airlines" '() *ir s+ Strategy+ Structure an$ Rivalry &he worldwide consolidation is increasing the rivalry" As the government has given permission to the private airline companies to start !p international operations, in f!t!re, the trend of consolidation might be followed in the local ind!stry as well"

(.:.1 4=isting "ar$et &or International Tra&&ic + ;une 78);uly 777escription Asia (iddle @ast Biman 1 passengers Airlines A120 0 6A AA7 66622 ) 11271A9 8arried2 <oreign 367901 3* 67 11A ** 2A727 @!rope America &otal >asseng ers 661**

1 >assengers2

23

&otal inbo!nd pa, 173131 by Biman &otal inbo!nd >a, 2202 by others &otal o!tbo!nd 1A **A pa, Biman &otal pa, carried by

113962 27A1A2 1 A*7

*2933 227 *7171

116A3 ) 130 A

3*1669 *1721 A07266

o!tbo!nd 197*22 carried by

37A276

7A

600672

others &otal inbo!nd pa, 393A19 carried by Biman and /thers &otal o!tbo!nd 3A6076 pa, carried by Biman and /thers

10A

7*721

116A3

*62733

60A*

130 A

100793

>ercent of Biman >a, with :espect to total pa, >ercent of /ther Airlines >a, with respect to &otal >a,

A7"2 B

3*"*B

62"6B

100B

A3"AB

*2" B

6A"*B

37"AB

via other destinati ons

*7"6B

21

<rom the fig!re it is seen that the ma=ority of Bangladesh.s traffic is carried by the foreign Airlines" &he fact that Biman has been !nable to cope with the mar%et growth, is concern for the Bangladesh economy has been paying a great price 1appro," 3# 9 1 billion ann!ally2

C>A/T4*)2 2.1 Analysis o& the study + Appendi= i &he findings of the st!dy were analy+ed by ta%ing the help of .+)test. and .chi) s$!are. tests of the several opinions that were e,pressed by the respondents" &he st!dy has been divided into two sectors" &he first sets of $!estions were designed to obtain general information of c!rrent and potential travelers" &hese data were so!ght to create at least a conservative o!tline of travelers, so that the target mar%et or a meas!re of the promotional arrangements to cater to these mar%ets can be determined" &he second set of $!estions were formed to determine the opinion of the present c!stomers of '(' Airlines and in case of those who haven.t e,perienced '(' Airlines before, their perception abo!t this company were so!ght"

2.2 The In&ormation o#tained &rom the study ,en$er


&he percentage distrib!tion of male and female respondents was 6A"32B and 3*"6 B respectively" &he percentage varies to certain e,tent, beca!se, before the distrib!tion of the $!estionnaires, the individ!als were as%ed whether they traveled fairly fre$!ently or not, as the st!dy was restricted among the fairly fre$!ent fliers" As the samples were chosen randomly, it can be s!ggested from the above)mentioned fig!res that male respondents tend to travel more by air

22

both in the national and international level, altho!gh, the specific reason for this difference co!ld not be definitely identified"

23

A0 3* 30 2* 20 1* 10 * 0

37"3

percentage

22"7 1*"13 7"6 17"3

20)2*

2*)30

30)3* age range

3*)A0

A0 !p

A!4 *A.!4 &he age range was defined from 20 years, beca!se, in Bangladesh, citi+ens below that range are mostly financially dependent and have less decision)ma%ing a!thority in choosing the airlines while travelling, altho!gh, this conception might vary among families, and other factors, which are beyond the scope of this report" Also, five years were gro!ped together, as people falling within those ranges tend to have similar opinions, and a wider gro!p might not give a more precise view of the scenario" &he percentage distrib!tion of the age range of the respondents has been given above"

-(. Monthly+ *a ily/ ,ross inco e in Tk


&he income level has been p!rposef!lly %ept high, beca!se the e,pense of travelling by air 1whether in the domestic or the international ro!te2 is $!ite high compared to other means of transport" &herefore, citi+ens residing at the lower income level have not been considered as potential c!stomers for the airlines companies" &he percentage distrib!tion has been mentioned below"
*0 A0 30 20 10 0 Below 2*000 2*000) A0000 A0000) 60000 60000) 7*000 7*000 3p 2A"9 12"A 3" 11"3 A7"6

/ercentage o& respondents

"onthly? <amily@!ross income in T$

2*

Altho!gh it can be ass!med that the percentage will be higher at the higher income range, A7"6B respondents are from the range of the income level of below 2*000" &his is beca!se most fairly fre$!ent fliers travel in official p!rpose and in most of the cases, the e,penses are carried by the organi+ation they serve" -(' Occupation -n order to gain a f!ll insight of the st!dy, occ!pation of the respondents has been determined as one the leading factor of this research, which will help to create a f!ll profile of the air travelers" A7" 2B of the respondents are government service holders, and among the 1A"13B who mar%ed .others., are st!dents, semi) government employees and some of them are c!rrently !nemployed"
60 *0 A0 30 20 10 0 'ovt service holder >rivate service holder B!siness /thers

percentage

occupation

-(- 0ocation of Resi$ence &his criterion was incl!ded beca!se, many aspects of people are revealed by the places where they choose to live" &he locations that were chosen incl!de posh, densely pop!lated and ma=or areas where the target c!stomers might reside" An open option was %ept for the respondents in case they belong to those areas other then the ones mentioned" -t is evident from the fig!res that a large s!m, 3 "0AB of the respondents mar%ed the .others. option" #ome of the places that were more fre$!ently mentioned were, (irp!r, A+imp!r, 'a+ip!r, Badda, (oghba+ar and 5ew @s%aton, th!s ens!ring the diversity of the respondents, which is also essential for an !nbiased res!lt"

2+

/ercentage o& respondents

A0 3* 30 2* 20 1* 10 * 0
sh

3 "0A

17"9 9" 2"2

1A"1

1A"1 3"

an

tta ra

or ag

di

an

p!

on

Ba n

' !l

am

ha

( oh

'ocation

-(1 0ocation of Office &he same areas were chosen, as these are the ma=or areas aro!nd the 8ity" /nly an additional area, (oti=heel was mentioned separately as it is a ma=or commercial area accommodating, many ma=or national and international instit!tions"

/ercentage o& respondents

60 *0 A0 30 20 10 0 1 *"A 3" 36"3

*2"* '!lshanC BananiC3ttara (ohammadp! rC7hanmondi #hantinagarC: amna (oti=heelE others

2,

#h a

nt in

nm

/ th e

ad

rs

-() Travelling by air Air travelling happens to be the fastest and most convenient means of transportation" Altho!gh, to reach certain destinations, it is not an option, b!t people sometimes choose this mode of transportation even when other means are available" &h!s it becomes important to !nderstand why does people travel by air, !nder which circ!mstances and in what fre$!ency" B!siness and holidays, seems to be the p!rpose of travelling for most people who !se this mode of transport at least once a year" &he other p!rposes, which were mentioned, were, ed!cational, visiting relatives and emergency p!rposes where the fre$!ency varied with circ!mstances and the people involved"
0 70 60 *0 A0 30 20 10 0 7*"3 *7"1 A3"3 33"3 23"3 A2"9 2A"7 31"9 /nce a (onth /nce a year /thers 6 "1

B!siness

6olidays

(edical >!rposes

/thers

"

2-

C>A/T4*)3 <indings
All the tests that have been !sed are done according to their appropriateness and they are stated as follows" The 0A Test0 + Appendi= ii-t is applied to test the n!ll hypothesis of each of the statements related to p!rpose of travelling, determinants of choice of a specific Airlines, reasons behind flying with '(' and the opinion of 'eneral people abo!t '('" &he J+? test is !sed beca!se the sample si+e is 1 * and the pop!lation mean is ass!med"

State ent 2- when 3 a i portance to a5 Ticket *are

travelling 4by air5 for official purposes 3 give

>oB :espondents said that tic%et fare was less important to them >aB :espondents said that tic%et6 fare was somewhat important to them &he n!ll hypothesis was re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be concl!ded that, while in official to!r, tic%et fare was only somewhat important to the respondents" b5 Other e6penses >oB :espondents said that other e,penses were less important" >aB :espondents said that other e,penses are somewhat important &he n!ll hypothesis was re=ected based on the calc!lation against the alternative hypothesis" &herefore it can be safely s!ggested that the respondents give somewhat importance to the other related e,penses of air travelling" c5 Routing >oB :espondents said that ro!ting is somewhat important 21

>aB :espondents said that ro!ting is most important" &he n!ll hypothesis has been re=ected based on the calc!lation against the alternative hypothesis" &h!s, respondents agreed that ro!ting is one of the most important aspects that is considered in air travel" $5 Stopovers >oB:espondents said that the stopovers are somewhat important >aB :espondents said that the stopovers are the most important aspect" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, concl!sion can be drawn that respondents have mar%ed stopovers as somewhat important"

e5 %o fort >oB:espondents said that comfort is somewhat important >aB:espondents said that comfort is most important &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents agreed that comfort is the most important aspect of air travel" State ent 78 when 3 a i portance to a5 Ticket fare >oB:espondents said that tic%et fare is somewhat important >aB:espondents said that tic%et fare is most important. &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be s!ggested that the respondents give most importance to tic%et fare, while travelling for personal reasons" b5 Other !6penses >oB:espondents said that other e,penses are somewhat important >aB:espondents said that other e,penses are most important. travelling 4 by air5 for personal reasons 3 give

22

&he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &his s!ggests that the respondents give most importance to other e,penses when they travel for personal reasons" c5 Routing >oB:espondents said that ro!ting is somewhat important >aB:espondents said that ro!ting is most important. &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis, which s!ggests that the respondents said that ro!ting is somewhat important when travelling, by air"

$5 Stopovers >oB:espondents said that stopovers are less important >aB :espondents said that stopovers are somewhat important. &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents give somewhat importance to stopovers, while travelling by air" e5 %o fort >oB:espondents said that comfort is somewhat important >aB:espondents said that comfort is the most important aspect &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis, mar%ing comfort as the most important aspect"

3.1 Analysis o& the results As the p!rpose of travelling can vary amongst people, to ma%e it convenient and easy to st!dy the p!rpose has been divided into two categories, official and personal" &he main reason for this division is to !nderstand whether the choice and preference of people varies with these categories" &his will also help in the

33

!nderstanding, which are the aspects of Airlines that are given importance when the p!rpose of travelling changes" <or e,ample, the same person who give importance to tic%et fare, while travelling at their personal e,penses, does not thin% abo!t the fare m!ch when the travel e,penses is carried by their organi+ation" Altho!gh, this seems to be an obvio!s res!lt, b!t it is noticeable that the finding of the +)test says that respondents still give somewhat importance to fare, even tho!gh their office bears the e,pense" -n this case they still have to %eep it !nder consideration, as the organi+ation tend to choose the Airlines that offers the lesser price" &herefore, they are not always at the liberty to choose the Airlines according to their own preferences" Apart from tic%et fare, other relative e,penses also play a vital role" #t!dy shows that this condition changes tremendo!sly when the p!rpose is different" 3s!ally, time is more of an important factor at official to!rs where as e,pense is the most important factor at personal to!rs" &h!s it becomes obvio!s that people will give more importance to the costs that are associated with their =o!rney, and the res!lt only proves this ass!mption" As mentioned before, timing plays a vital role while attending conferences and b!siness meetings, th!s it is cr!cial that the ro!te that is ta%en by the aircraft is straight forward and less time cons!ming" Dhereas, a little deviated ro!ting will have a little less importance to the person who does not have any time constraint, and who apparently pay less beca!se of this factor" Altho!gh the reason for the stopover points may vary with the p!rpose, b!t this seems a somewhat important factor among all the respondents" &he most important reason why flight is chosen even tho!gh some options might be available beca!se of the comfort factor that is associated with flying" @ven tho!gh preference varies amongst people, everyone agreed !nanimo!sly that comfort is always so!ght and is foremost important and does not vary with the p!rpose of the =o!rney" 1(9 State ent :98 3 choose a particular ;irlines base$ ona5 ;ffor$ability

31

>oB:espondents said they agree that they choose their airlines based on its affordability >aB:espondents strongly agree affordability" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents strongly agree that they choose their airlines based on its affordability" b5 3 perceive that the journey will be secure$ an$ safe >oB:espondents agree that they choose their airlines based on their perception of safety" >aB :espondents strongly agree perception of safety" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents strongly agree that they choose their airlines based on their perception that the =o!rney will be safe and sec!red" that they choose their airlines based on their that they choose their airlines, based on its

c5 Reliability of flight ti ings >oB :espondents agree that they choose their airlines based on its reliability of flight timings" >aB:espondents strongly agree reliability of flight timings" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents strongly agree to the statement that they choose their airlines based on its reliability of flight timings" $5 The aircraft use$ is upto the 3nternational stan$ar$ >oB :espondents agree that they choose their airlines based on the fact that the aircraft !sed is !pto the international standard" >aB :espondents strongly agree , that they choose their airlines based on the fact that the aircraft !sed is !pto the international standard" that they choose their airlines based on its

32

&he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents agree to the statement that they choose a partic!lar airlines based on the fact that the aircraft !sed by the organi+ation is !pto the international standard" e5 My previous e6perience with the ;irlines %o pany >oB :espondents isagree that they choose their airlines based on their previo!s e,perience with the airlines" >aB :espondents agree , that they choose their airlines based on their previo!s e,perience with the airlines" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents agree to the statement that they choose an airlines based on their previo!s e,perience with the airlines company" f5 3t has less acci$ents/ alfunctioning rates >oB :espondents agree that they choose their airlines based on its accidentsCmalf!nctioning rates( >aB :espondents strongly agree , that they choose their airlines based on its accidentsCmalf!nctioning rates( &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, it can be said that respondents strongly agree to the statement that they choose airlines, based on its accidentsCmalf!nctioning rates ( g5 <uality of service that is receive$ at the check-in an$ check-out points >oB :espondents isagree that they choose their airlines based on the $!ality of service >aB :espondents agree , that they choose their airlines based on the $!ality of service &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, the respondents agree to the statement that they choose a partic!lar airlines, based on its the $!ality of service received at the chec%)in and chec%)o!t points"

33

h5 #ehavior of on-boar$ crew

e bers

>oB :espondents agree that behavior of on)board crewmembers are important >aB :espondents strongly agree , that behavior of on)board crewmembers are important" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" Dhich proves that respondents agree that behavior of on) board crewmembers has an impact on their choice of the Airlines" i5 3t provi$es goo$ groun$ services 4refun$ing an$ others5 >oB :espondents isagree that they chose their airlines based on the $!ality of gro!nd service" >aB :espondents agree , that they chose their airlines based on the $!ality of gro!nd service" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, the respondents agree that they chose their airlines based on the $!ality of gro!nd service that the organi+ation offers" j5 3 perceive the to be co-operative in case of any luggage isplace ent

>oB :espondents agree that they chose their airlines based on the perception that they will be co)operative" >aB :espondents strongly agree , that they chose their airlines based on the perception that they will be co)operative" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, the respondents agree mishaps" 3.2.1 Analysis o& *esult Air travel is considered a l!,!ry when other ine,pensive options are available" &h!s, when air travel is chosen, all other options are considered before the final decision is made and !s!ally the airlines with the lower rate is chosen" Also, their perceptions abo!t the airlines. sec!rity and safety standards play an important role where, peer s!ggestions, previo!s e,perience and the c!rrent eval!ation of that they chose their airlines based on the perception that they will be co)operative, specially in case of any

3*

the organi+ation are considered" &his is f!rther proven by the fact that respondents also strongly agreed that they chec% the aircraft previo!s accidentsCmalf!nction rates before they !ltimately ma%e their decision" &he reason that they are so ca!tio!s abo!t flying beca!se, altho!gh there are fewer air accidents than road or rail road accidents death percentage is higher in case of plane accidents, so the ris% factor is act!ally more higher than any other transportation" &hey also tend to see whether the aircraft that is being !sed are !pto the international standard and !se the international reg!lation and safety standards, even if it is !sed for domestic p!rpose" As mentioned earlier, air travel is the less time cons!ming transportation available" &herefore, it is e,pected that Airlines 8ompany will try their best to maintain the flight timings so that passenger is not deprived from this criterion as promised" &he importance of this element is seen and !nderstood from the res!lt that almost all respondent strongly agreed that they choose a partic!lar airlines depending on whether they can depend on its flight timings or not" As they pay more for flying, it is apparent that people will desire better $!ality of service from the Airlines employees than from other transportation services" #pecially, the service offered by the on)board employees s!ch as the crewmembers seems to determine to a large e,tent whether someone will choose one Airlines over the other" 0!ggage misplacements or other diffic!lties are not an !n!s!al phenomenon that has been faced by many passengers of almost all of the Airlines companies" &h!s there is always the e,pectation that f!ll co)operation on the part of the organi+ation will be provided in order to remedy the sit!ation and retrieve the baggage"

3.% <indings a#out !"! Airlines 'td + Appendi= iii&he second set of $!estions have been designed to !nderstand the perception and opinion abo!t this company, the determinants factors behind its s!ccess and some factors which might need improvements" &his sector has been f!rther divided into two sections, the respondents who have flown with '(' and the respondents who have not" -n case of the respondents who does not have

3+

previo!s e,perience with the company, their perception abo!t the organi+ation has been considered" State ent :'8 3 have flown with ,M, ;irlines becausea5 #ecause 3 wante$ to e6perience ,M, services >oB :espondents isagree that they have flown with '(' Airlines to e,perience its services" >aB :espondents agree , that they have flown with '(' Airlines to e,perience its services" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, the respondents isagree that they have flown with '(' Airlines to e,perience '(' services" b5 3 always choose ,M, when 3 fly within the country >oB :espondents agree that they always choose '(' for domestic travel" >aB :espondents strongly isagree , that they always choose '(' for domestic travel &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, the respondents agree that they always choose '(' for domestic travel" c5 3 ha$ to choose ,M, as 3 ha$ no other choice >oB :espondents isagree that they have chosen '(', as they had no other choice >aB :espondents agree , that they have chosen '(', as they had no other choice" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis, s!ggesting that the respondents agree that they have chosen '(', as they had no other choice" 3.%.1 Analysis o& *esult

3,

&he first statement is a straightforward $!estion, which as%s why they chose '(' in the first place" &he respondents disagreed that they have flown with '(' =!st to e,perience its services, which only s!ggests that they chose it beca!se of a specific reason" As, they have agreed that they almost always choose '(' for flying in the domestic region, one reason that s!rfaces is that, they are not satisfied with the other carrier that also flies domestically, which is Biman Bangladesh"

1(' State ent :18 Please e6press your opinion about ,M, ;irlines 0t$ a5 0ow airfare >oB :espondents isagree that '(' has low fare >aB :espondents agree , that '(' has low fare" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis, s!ggesting that the respondents isagree that '(' has low airfare"

b5 The ! ployees 4 groun$ service5 are co-operative >oB :espondents isagree that '(' employees are co)operative >aB :espondents agree , that '(' employees are co)operative &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis, which s!ggests that the respondents agree are co)operative c5 Ticket booking an$ other proce$ures are less ti e consu ing >oB :espondents isagree that tic%et boo%ing and other proced!res are less time cons!ming >aB :espondents agree , that tic%et boo%ing and other proced!res are less time cons!ming" that '(' employees

3-

&he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, respondents agree proced!re ta%es lesser time with '(' Airlines" $5 ,oo$ check-in an$ check-out service >oB :espondents services" >aB :espondents agree , that '(' provides good chec%)in and chec%o!t services" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, respondents agree that '(' provides good chec%)in and chec%o!t services" e5 The crew e bers are well traine$ >oB :espondents isagree that the on) board crewmembers are well trained" >aB :espondents agree , that the on) board crewmembers are well trained" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, respondents agree Airlines are all well) trained" f5 Recently offere$ international $estinations are attractive >oB :espondents attractive" >aB :espondents agree attractive" &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &herefore, respondents international destinations are attractive" g5 3 can rely on the flight ti ings >oB :espondents isagree that they can rely on its flight timings >aB :espondents agree that, they co!ld rely on its flight timings" isagree that, the recently offered that, recently offered international destinations are isagree that recently offered international destinations are that the crewmembers of '(' isagree that '(' provides good chec%)in and chec%o!t that tic%et boo%ing and other

31

&he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &herefore, respondents agree timings h5 Tickets are available at all ti es >oB :espondents isagree that flight tic%ets are available at all times >aB :espondents agree that, flight tic%ets are available at all times &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis, stating that, respondents agree that, flight tic%ets are available at all times i5 ,M, ;irlines has the potential to provi$e a secure$ an$ co fortable journey >oB :espondents isagree that '(' has the potential to provide a sec!red and comfortable =o!rney" >aB :espondents agree that, '(' has the potential to provide a sec!red and comfortable =o!rney" &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &h!s respondents agree to the statement that, '(' has the potential to provide a sec!red and comfortable =o!rney" j5 The aircraft are in goo$ con$ition >oB :espondents strongly isagree that the aircraft are in good condition >aB :espondents isagree that, the aircraft are in good condition &he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &h!s respondents isagree to the statement that, '(' the aircraft are in good condition k5 3 woul$ prefer ,M, only to #i an #angla$esh >oB :espondents isagree that they prefer '(' only to Biman Bangladesh >aB :espondents agree that, they prefer '(' only to Biman Bangladesh that, they co!ld rely on its flight

32

&he n!ll hypothesis is re=ected based on the calc!lation against the alternative hypothesis" &h!s respondents agree to the statement that, they prefer '(' only to Biman Bangladesh Airlines"

3.(.1 Analysis 8ompare to Biman Bangladesh Airlines, '(' Airlines has a higher tic%et fare which is the res!lt of ta,ation and additional e,penses that this private organi+ation end!res, from which Biman is e,empted as it is s!pported by the government" B!t it also shows in the res!lt that the service provided is also of a better $!ality to that of the national carrier, where the tic%et)boo%ing and other proced!res ta%e more time than '(' Airlines, and the employee co)operation level is also higher in '('" &he point where it definitely beats Biman is where the $!estion of maintaining the flight timings is raised" Biman has been very notorio!s in its contin!o!s fail!re if p!nct!ality, where '(' has been so far maintaining it properly, considering some !navoidable circ!mstances which was beyond the control of any organi+ation of this ind!stry" 3nfort!nately, respondents were not very enth!siastic abo!t the condition of the Aircraft, which has been sometimes regarded as being cramped and small" Altho!gh, it is tr!e those domestic flights are of a m!ch shorter trips than international ro!tes, b!t even then the passengers e,pect a bigger and better craft" :ecently, '(' has offered one international ro!te and more is !nder process b!t passengers still thin% that most of these destinations has failed to arose that vol!me of e,citement amongst the passengers" ;!dging from its previo!s rep!tations respondents seem to believe that it has the potential to provide a sec!red =o!rney in almost any international ro!tes and so they sho!ld start to p!rs!e more attractive international destinations, provided a m!ch better aircraft is !sed" B!t it dos not necessary prove that has been considered as the !ltimate sol!tion beca!se it is only better when compared to Biman which is not a very standard

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scale" &herefore, based on only this information it will be !nwise to concl!de that it will see similar s!ccess in the -nternational scenario where competition is more fierce and covers a wider range of competitors"

3.2 chi)sCuare Test + Appendi= iv&he 8hi)s$!are test is applied to find whether there is Association between the different Occupations of the respondents with the reason of choice+ and inco e with the aspects of airlines that are given i portance to . As, the two s!b=ect matter mentioned, involve two variables, therefore this test is !sed"

3.2.1 Association

ith occupation and the reason &or choosing an Airlines

>oB &here is no association between occ!pation and the reasons behind the choice of a partic!lar >aB &here is an association between occ!pation and the reasons behind the choice of a partic!lar &he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &his means that there is no association between occ!pation and the reasons behind the choice of partic!lar airlines" 3.2.2 Association #et een income and the aspects that are given hile travelling &or personal reason

importance

>oB &here is no association between income and the aspects that are given importance to, while travelling for personal reason" >aB &here is an association between income and the aspects that are given importance to, while travelling for personal reason"

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&he n!ll hypothesis is not re=ected based on the calc!lation against the alternative hypothesis" &his means that there is no association between income and the aspects that are given importance, while travelling for personal reason"

3.2.2.1 Analysis &ests were carried o!t to see whether there was any relation between the occ!pation of the respondents and the reasons that received priority while choosing Airlines" :elation between income and the aspects that are given importance to while travelling for personal reasons were also st!died" Both of these factors yielded negative res!lts s!ggesting that income level of an individ!al does not s!ggest that that person will give importance to certain aspects of any Airlines, neither does occ!pation tells !s the reasons behind any of their choice"

69"AB of the respondents having a gross family income of less than &4 2*000, mar%ed tic%et fare as most important, and 69"2B of the respondents who had a gross family income of &4 7*000 and !p, mar%ed tic%et fare as most important" Altho!gh it is tempting to ass!me that income level definitely changes the priority of the tic%et fare, in reality its is not so" &here can be other factors, apart from the level of income, which has an affect on their preferences"

AB of 'overnment #ervice 6older, B!sinessman and

B of >rivate #ervice 6older, 90B of

*B of people from other occ!pations agreed that they

want good behavior from the crewmembers and their choice largely depends on this element" Altho!gh the fig!res varied to a smaller amo!nt it shows that a greater percentage from people of all profession is giving priority to this aspect, which to a larger e,tend determines their choice" &o f!rther proof this point, *7B of 'overnment #ervice 6olders, 63B of >rivate #ervice 6olders, 63B B!sinessman and *7B of respondents from other occ!pation, wanted to travel with the Airlines that offers the best gro!nd)service, which again s!ggests that their are certain region of a Airlines company that is desired and e,pected from people from all range"

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3.3 Some !eneral &indings@&acts

32B of all male pay a visit either to 4ol%ata, 8olombo, 8hennai or 4atmand! at least every year, 60B of the time for b!siness and official p!rposes" Among this 32B, 70B visits are in 4ol%ata alone where A0B of the time it is for vacation and shopping p!rposes" /n the other hand 33B of female respondents visits these destinations among which 90B visits are in 4ol%ata and 9*B of the time it is for vacation or shopping"

31B of the respondents who has previo!sly flown with '(' resides in the (ohammadp!r C 7hanmondi region and 32B resides in the '!lshanC Banani region" And A0B of these respondent.s gross family income of 2*000)A0000"

Almost every one, regardless of whether they have previo!sly flown or not said the on)board facility, in other words the $!ality of the cabin crew members, are the most important determinant factor of an -nternational standard Airlines company"

(ost of the time, people choose their own Airlines when ta%ing the help of travel agencies" Dhen the destination is decided, they tend to go thro!gh the fairs offered by the different companies 3s!ally, the corporate travelers, or more precisely, people who travel for b!siness or official p!rposes, they give more emphasis on their comfort rather than on the e,pense"

3s!ally people want airlines that offer the most direct ro!te with the lowest fair" <re$!ent flier system, i"e c!m!lative mileage) After a certain mileage is covered by the traveler, with one partic!lar Airlines, heCshe gets certain benefits, i"e" free tic%ets and more" @ven if the person travels for official p!rposes that mileage is added as the personal mileage covered" &herefore, preference also depends on this factor"

&he local, Bangladeshi people tend to travel in the far)east co!ntries more" <or e,ample) 4!alalamp!r, 8hiang)(ai, >h!%et etc 1tr!e for average to above

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average travelers2" Before, they !sed to prefer -ndia, b!t recently, traveling e,penses in these co!ntries has become cheaper"

&he more Dell)off travelers go to @!ropean and American co!ntries" &he main reason being that some family members are dispersed within these co!ntries" &ime of travel) &he vacations are mostly ta%en before @id times" &hese has been a recent trend and more applicable for the local people" B!t the e,patriates travel more on 7ecember, on 8hristmas time"

#ometimes, e,patriates tend to go for official visits along with vacations" 8ompanies allow this proced!re, as this way it is cheaper than it wo!ld have been, if it was ta%en =!st for vacations"

**

C>A/T4*): *ecommendation +in terms o& !overnment *egulation#ome of the policies, still e,ists, which, if not reformed will also hamper the operation of the private carriers, even tho!gh private companies might not have the limitation that the national carrier have" -f the private carriers fit the criteria for international standards, with the help of the A#A, government sho!ld ta%e more active initiative to bring the private carriers in the active center of the international sector" 5ot allowing the private sectors in the ro!tes of the Biman, b!t letting the foreign Airlines 8ompany to operate from Bangladesh was not a wise sol!tion to improve the sector, beca!se Biman mercilessly failed to s!rvive the open competition" &h!s it is advisable that the private Airlines sho!ld be given the permission to fly in the pop!lar destinations" <or e,ample) it is e,perienced by the Bangladeshi passengers that most incoming flights of passengers of @mirates are wor%ing class citi+ens of Bangladesh who earn their living in the middle)eastern co!ntries" &herefore, allowing the private airlines in these ro!tes will earn some foreign c!rrencies from the local citi+ens"

:.1 *ecommendation &or !"! Airlines


-n the -nternational scenario vast and fierce competition will be faced by '(' with some of the leading -nternational Airlines companies of the world, therefore, some reformation and strategic changes and implementation might be necessary for the s!ccess in the near f!t!re"

-n case of overcapacity in flights in the off)pea% seasons, on)line tic%et a!ctioning system can be introd!ced which will prevent the company from loosing the val!e of the empty seats" 1&his system is pop!lar in the western co!ntries2"

&he strategy for entering into foreign mar%ets and have international operations, is a Market Develop ent strategy, where '(' can ta%e *+

advantage of the opport!nities li%e growing leis!re travel, trading and getting foreign degrees" As they have already started its voyage in -ndia, they can e,ploit all the opport!nities mentioned above"

As they are e,panding their b!siness, they wo!ld definitely have to do some restr!ct!ring in the company" 6owever, as the basic infrastr!ct!re has already been set !p, some minor changes might be re$!ired"

Altho!gh it is costly, b!t is advisable, that better Aircraft sho!ld be added in the international ro!tes as people e,pects -nternational standard of service in all respect" #t!dy reveals that ma=ority of respondents. thin% that the aircraft needs improvement"

:.1.1 >uman resource

3pdated training sessions for e,isting employees can be arranged so that they are aware of the c!rrent sit!ation in the ind!stry" @ach ma=or wor% area can have it.s own training department which wo!ld incl!de speciali+ed co!rses for each discipline"

Ann!al meetings can be arranged to create a bridge between employees ranging from the lower and higher level of the hierarchy" All employees sho!ld be enco!raged to s!ggest anything regarding salary, wor% environment and other sensitive iss!es, which will enhance the motivation of the wor%ers as they will believe that they are an important asset of the company" &he creative s!ggestions sho!ld be e,ec!ted and implemented properly to gain the tr!st of the employees"

A separate 6!man :eso!rce department can be introd!ced which can monitor recr!itment, training programs, employee co!ncil and other related iss!es"

)(:(9 Pro otion

A lac% of proper promotional initiatives has been noticed from '('" Altho!gh, people are aware of the attractive pac%age offers that they have, these advertisements fail to initiate the drive among citi+ens" (ore aggressive promotional campaign needs to be established to increase the responsiveness *,

of passengers" Attractive billboards can be placed in ma=or areas of the city with the c!rrently practiced news paper adverts" &he lay)o!t of the c!rrent adverts can be made more attractive and eye catching, to gain the f!ll affect"

)(:(. ServiceS

#eparate c!stomer care booths can be placed specially in the pea% seasons, which will be dedicated specially to c!stomer feedbac%, or complaint and any problems faced by the passengers"

&ransportation services from the airport can be provided for the passengers" 1#ome special cases do en=oy the practice b!t this service can be made available for all willing passengers2"

As the c!rrent international flight is from 8hittagong)Ban%o%, the pro$uct $evelop ent can be achieved by offering special pac%age or disco!nt programs for the passengers in the 7ha%a)8hittagong)4ol%ata ro!te"

-nitially, at a smaller scale, fre$!ent flyer facilities can be given to the top e,ec!tives of the leading companies of Bangladesh"

Conclusion
-A&A 1-nternational Air &ransport Association2 has shown a growing trend over the global air traffic, which is a positive sign for the airline ind!stry" -n the phase of *-

tremendo!s competition in the -nternational Airlines -nd!stry, '(' has to be very caref!l in choosing its strategies that will give them a s!stainable competitive advantage over the other companies" &h!s contin!o!s monitoring and eval!ation by the top management is advisable in order to ma%e its prominence in the -nternational region" B!t, to improve the sit!ation for Bangladeshi airlines, government also has to play a vital role and s!pport the ind!stry by ta%ing proper policy reg!lation and setting standards for both the government and non) government organi+ations"

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