Application
This unit describes the performance outcomes, skills and knowledge required to make, implement, and monitor pricing decisions to maximise yield and business profitability.
The unit applies to senior personnel who work autonomously and are responsible for making strategic business decisions.
It applies to supplier organisations in the tourism, travel and hospitality industries, in particular to the accommodation, tour operations and tour wholesaling sectors.
No occupational licensing, certification or specific legislative requirements apply to this unit at the time of publication.
Elements and Performance Criteria
ELEMENTS | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Analyse and forecast business activity. | 1.1.Analyse existing performance data and budget targets. 1.2.Interrogate and compare sources of business activity from different distribution channels and market segments. 1.3.Evaluate external market factors, competitor activity and changing customer demand patterns. 1.4.Develop scenarios and forecasts around future business performance and revenues. |
2. Make pricing decisions. | 2.1.Confirm net, fixed and variable delivery costs. 2.2.Review and incorporate distributor commissions and mark-ups. 2.3.Set standard and promotional rates for different times, trading periods and market segments based on analysis of forecasts, pricing options and optimum yield. 2.4.Assess the need for special conditions and apply as required. 2.5.Document pricing structures and associated terms and conditions, with consideration of consumer protection requirements. |
3. Implement pricing decisions. | 3.1.Communicate pricing initiatives to colleagues, internal and external partners, and distribution channels. 3.2.Establish mechanisms and collateral to support pricing decisions in different market segments. |
4. Monitor pricing initiatives. | 4.1.Monitor revenue results achieved through pricing and distribution initiatives on a timely basis. 4.2.Adjust initiatives based on results and broader business and market analysis. 4.3.Record performance data for future analysis. |
Evidence of Performance
Evidence of the ability to complete tasks outlined in elements and performance criteria of this unit in the context of the job role, and:
using each of the following at least once, develop, implement and monitor a total of six different pricing initiatives for:
products
services
trading periods
market segments
demonstrate consideration of the following factors when determining each of the above pricing initiatives:
revenue management principles
industry distribution and marketing considerations.
Evidence of Knowledge
Demonstrated knowledge required to complete the tasks outlined in elements and performance criteria of this unit:
key principles and terminology of revenue management:
dynamic and static pricing
market penetration index
matching supply and demand
performance metrics
perishability
responsiveness and timing
revenue generation index
shaping demand through price
types of business performance data used in revenue management:
financial reports
historical trends
market analysis
no-show reports
occupancy and load reports
sources of business
supply and demand analysis
mechanisms and collateral that support initiatives in different market segments:
channel management systems
global distribution systems
online requirements:
promotions
proprietary websites
third party websites
types of promotions
sector-specific factors that impact revenue management initiatives:
financial:
fixed and variable operating costs
profit margin requirements
industry commission and mark-up procedures
cost of distribution networks
external market factors:
competitor activity
complementary activity
travel capacity
special conditions:
block out dates
inclusions
payment requirements
stay controls
aspects of consumer protection law that impact on pricing and distribution.
Assessment Conditions
Skills must be demonstrated in an operational tourism, travel, hospitality or event business operation for which revenue management initiatives can be developed. This can be:
an industry workplace
a simulated industry environment.
Assessment must ensure access to:
current information and communications technology
current industry and business data.
Assessors must satisfy the Standards for Registered Training Organisations’ requirements for assessors.
Foundation Skills
Foundation skills essential to performance in this unit, but not explicit in the performance criteria are listed here, along with a brief context statement. | |
SKILLS | DESCRIPTION |
Reading skills to: | interpret complex business performance information. |
Numeracy skills to: | analyse business performance data calculate different commission and mark up-structures assess profitability scenarios. |
Problem-solving skills to: | interrogate complex business information and develop business strategies in response develop strategic responses to business performance challenges. |
Technology skills to: | work with financial and forecasting models and online distribution channels. |
Sectors
Cross-Sector
Competency Field
Finance