Ryanair -- strategy and operations

Ryanair is easily my favourite company. For me, business is about strategy and operations. 

I don't really care whether BCE is a private company focused on servicing debt, or a public company serving regulators. Their decisions around content, and the pipes (including mobile ones) through which they push that content is most interesting. 

Here's a quote about Ryanair: 
Geoff Van Klaveren, an analyst in London at Exane BNP Paribas, said Ryanair hauls in more revenue, relatively speaking, from "ancillary" sales than any other airline. In the last financial year, to March 31, 2008, this category was equivalent to 18 per cent of total revenues of €2.7-billion, up from 14 per cent in 2005 and 11 per cent in 2001. "This will keep climbing," he said, which is one of the reasons Ryanair is one of the few airlines that carries an Exane "sector outperform" rating.

When I worked for a gas station company, I learned that their strategy is to effectively break even on the gas (they buy it from people making money on taking it out of the ground), and sell a few $2.75 cokes and maybe a $6.00 bag of milk to everyone who passes through the door. 

In fact, if Ryanair trusted the right company, it could sell off its entire aircraft operations division and rent back the flights, then operate solely as an ancillary business. As I said before, their business model is merely to convince a large fraction of Europe to lock themselves inside one of their pressurized, tube-shaped stores for 6 or 8 hours a month.


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