Research On The Strategy Of Railway Freight Inventory Control Based On Revenue Management

Revenue management originated in the air industry has become an efficient tool of improving air passenger and freight revenue. Now, it has been widely used in the service industries like hotel, tourism, freight transportation, car rental and telecom and so on. China railway freight has implemented the market reform. Facing the fierce competition from road and air, if the railway wants to improve freight market share and increase freight revenue, it must introduce scientific management methods, oriented by market demand, and make full use of existing resources to improve the marketing organization of railway freight constantly. Inventory control is one of the most important techniques in the revenue management, so the paper firstly analyzes the feasibility of railway freight inventory control and focuses on the dynamic inventory (slot) control of railway freight. The core content of this paper includes the following aspects:Based on the characteristics of booking arrival process of railway freight, the paper assumes the railway freight inventory booking process is a non-homogeneous Poisson distribution which is fairly realistic and can divide the decision-making stages scientifically so as to allow at most one request per time period. Firstly, the paper establishes the single leg multi-rates dynamic inventory control model of railway freight. By numerical example, we get that compared with static inventory control, dynamic inventory control can receive more expected revenue and it also can timely adjust the inventory availability of different freight according to the current decision stage, current inventory and marketing demand to maximize revenue.Next, the paper further establishes multi-legs multi-rates dynamic inventory control model of railway freight. Because of the curse of dimensionality in solving the model, the paper transfers it to the deterministic linear programming problem and then uses bid price policy to control the slot booking process. The paper analyzes both additive bid prices and certainty equivalent control policy, and in the numerical example we analyzes the impact of bid prices that get by the two control policies on the total revenue and we get that certainty equivalent control is better than additive bid prices policy.