All professionals at PROLOGIS STRATEGY have a proven track record in developing comprehensive partnership strategies including the negotiation and implementation of joint ventures, alliances membership and interline/codeshare agreements. This makes us real experts in the field and with our deep knowledge and proprietary tools we can help your company to determine the right partnership strategy and manage the complexity arising from international cooperation.
Joint Ventures / Joint Businesses: The strong growth of bilateral or multilateral joint ventures and joint businesses will continue and has the potential to exceed a share of 45% on international markets within the next 5-10 years. This form of cooperation significantly strengthens existing partnerships in terms of volumes, market shares and financial contribution. Irrespective of whether joint ventures are based on revenue sharing or profit sharing, they go far beyond any codeshare relationship and typically include joint planning, joint pricing & revenue management as well as joint sales & marketing. This far reaching form of cooperation does of course require regulatory clearance, i.e. anti-trust immunity or positive self-assessment.
Joint ventures are a core competence of PROLOGIS STRATEGY. With our deep knowledge and proprietary tools, we can help your company to
- Understand the principles and complexity of joint ventures
- Assess and evaluate membership in an existing joint venture or forming a new joint venture
- Model and forecast the short-, mid- and long-term benefit both qualitatively and quantitatively for your company
- Identify and negotiate the terms and conditions on which your company should enter a joint venture
- Manage the integration process
- Create and implement a sophisticated review process to ensure that the joint venture performs as designed
Alliances: For the last 15 years we have seen rapid growth of global alliances. Many airlines around the world have joined one of the four major alliances to increase their individual network reach, thus extending their relevant market at relatively minimal cost. Although membership in an alliance creates significant sales, marketing and customer benefits, we have seen a slowdown in the growth of alliances in recent years. It was contemplated that the alliances model will no longer fit into the future marketplace, but, based on our deep expertise in this area, PROLOGIS STRATEGY firmly believes that alliances will continue to play an important role in global aviation, irrespective of the rapid growth of bilateral or multilateral joint ventures and joint businesses.
With our broad experience and proprietary tools, PROLOGIS STRATEGY will
- Facilitate top management discussions in your organization on the future of alliances
- Present a detailed SWOT analysis on each global alliance based on the most recent data and information
- Assess the strategic fit of your airline with each global alliance
- Evaluate the financial impact of joining an alliance or exiting/changing an alliance
- Make a clear recommendation concerning alliance membership
- Facilitate the negotiation and implementation phase
Interline/Codeshare Partnerships: Interlining and codesharing are basic forms of airline cooperation. They allow the contracting parties to increase their network reach and to leverage sales and marketing benefits. Although the industry is focusing on joint ventures and joint businesses, one should not forget the importance of interline and codeshare relationships with respect to a company’s overall partnership strategy. Basic interline and codeshare agreements typically contribute between 6%-12% and occasionally even above 20% to an airline’s overall revenue. Hence proper management of these relationships is critical to protecting and increasing your airline’s revenues.
PROLOGIS STRATEGY is a real expert in this field, and with our proprietary tools and our experienced professionals, we can support your company in
- Reviewing and optimizing existing interline/codeshare agreements based on industry best practice
- Reviewing and optimizing the internal cross-functional and cross-departmental interline/codeshare process
- Assessing the strategic fit of your airline with each global alliance
- Proper budgeting of revenues and costs
- Providing full transparency on your interline/codeshare activities including the most accurate display of the financial results though our “Partnership Balanced Scorecard”