Bonus and cargo income

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MOW
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Bonus and cargo income

Post by MOW » Mon Mar 29, 2010 3:44 am

I do not see this topic in other part, so I raise up the questions here.

Is someone knowing how is calculated the bonus and how is calculated the cargo income. For the last one, I saw the calculation line, but I do not find always the same cargo price per kilo, even leaving the same airport. For example, LFPB is going from 0,98/kg to 1,17/kg on 5 flights. To know this could help to decide, in case of Weight excess, between getting less passengers or less cargo, in order to maintain the flight financially interesting !

This information is clear for fuel (and to know about is important iot decide the airport where to refuel).

About "bonus", I do not find any indication of the way it is calculated (respect of scheduled time ?).

Thk for answering if you get the information !

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Re: Bonus and cargo income

Post by CAPFlyer » Mon Mar 29, 2010 3:55 am

Cargo price is calculated per weight/per mile. We did some data gathering using real world shipping calculators to determine what the scale was that was used and implimented something similar here. Basically the way they do it is a sliding scale that means that the cost does not increase linearly with the distance, so a longer flight won't give you a linearly higher revenue.

However, no matter which way you put it, cargo will still yield you more revenue on a flight than a person. This is why airlines ALWAYS bump people before cargo.

As for the "bonus", it is based on the highest time acceleration used during the flight. You get a 20% bonus (I think) for using no higher than 1x on a flight and it reduces to 0% bonus on 8x and 16x max time acceleration used. Basically we wanted to give incentive for people not to use 16x on short flights in order to fly a lot of flights on a short amount of real time.
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Re: Bonus and cargo income

Post by MOW » Tue Mar 30, 2010 6:05 am

Thk Capflyer, it makes the things cleared to me.

Just one point about cargo. I saw that the cost per weight/per mile is not the same from the same airport (like fuel). Does it mean that it depends of the destination also ?

Anyway, I will "bump" passengers now !!! :shock:
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Re: Bonus and cargo income

Post by alasizon » Wed Mar 31, 2010 8:42 pm

I may be wrong but as I recall it is based on aircraft capacity.
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Re: Bonus and cargo income

Post by Konny » Thu Apr 01, 2010 12:29 am

Well, actually it really only depends on the distance and the cargo weight. For the same amount of cargo you should always get the same money if you fly the same route.
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Re: Bonus and cargo income

Post by CAPFlyer » Thu Apr 01, 2010 1:24 am

MOW wrote:Thk Capflyer, it makes the things cleared to me.

Just one point about cargo. I saw that the cost per weight/per mile is not the same from the same airport (like fuel). Does it mean that it depends of the destination also ?

Anyway, I will "bump" passengers now !!! :shock:
"per mile" means distance of the route, so then yes, the price you get per weight/per mile, then it will change if you're flying to 2 different airports with a different distance from the origin.
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Re: Bonus and cargo income

Post by mr.shiljo » Thu Nov 25, 2010 11:19 am

Hi all!

Just to put some Cargo related income issue here. Your calculations on cargo can't be right...I fly 5 flight cca 5hrs..and income was 1.400.000 with cargo income iondex 0.06...Last flight was 10hrs and income was 500.000...basic one without multiplier was 144.000 and even bopnus was 3 times smaller...??? It way longer flight with same cargo...should be more income regardless double fuel consuption...Income must be greater...and that should be fixed in that index.0.04/100NM, must be more on longer flights...so it has more influence on icome and less on fuel, no one will fly those flight because of that, and that one are more valuable...

This section removed by admin - Confidential Data

That is direct flight...so...please fix those calculations as LONG HAUL are well paid and are worthy to fly...For us hardcore long haul fliers its imperative...

Thank you very much i hope you will get this and change cargo income formula as this has to be related between index 0.04 or 0.06 and distance, more distance more index...and then calculatiomns will be right...

Thank you for understanding...

Bye!
Last edited by CAPFlyer on Thu Nov 25, 2010 6:21 pm, edited 1 time in total.
Reason: Removal of confidential data

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Re: Bonus and cargo income

Post by alasizon » Thu Nov 25, 2010 5:03 pm

Were these done with the same type of plane?
The type of plane makes a difference as I recall.
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Re: Bonus and cargo income

Post by CAPFlyer » Thu Nov 25, 2010 6:20 pm

First, please don't start a forum thread AND a support ticket. This only causes us to have to do twice the work.

Second, I removed the data you posted from "UPS" for two reasons - 1) you don't cite your source (bad idea), and 2) that kind of data is normally confidential, so back to 1 since you didn't post where you got it, I have to assume it's not publically available.

Our data is based off of market research from the real airlines and cargo operators on how they do their pricing schemes. There might be room for some adjustment, but because we don't have the money to get the reports that give us the kind of data fidelity to do that, this system has proven to work extremely well since we started it over 3 years ago.
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Re: Bonus and cargo income

Post by mr.shiljo » Sat Nov 27, 2010 12:12 pm

Rgr, BUT...

UPS data is on web and everybody can get it ;) so its public...But i didnt doubt in your system, its great...But, its impossible to have flight of 5 hrs with same type of plane 777F, 2T less cargo that is paid better then 10hrs 2 T more cargo same plane, no chance man. And you cant argue me with spent or bought fuel...In the end the income must be greater, not lineary, but slightly greater...Thats hows got to be, and is in real world...otherwise everybody will fly domestic regional cargo instead of Long haul ;)

I would love that something can be done about income from cargo flights...Its ok for now, but no realistic...and has place for improvement. I am ready to help in this in any way, just to make thing better and realistic...Im not judging nobody, system runs as it supposed to, but some things can be better, and lets make them, if u have will...I said i have time and will to help you if u want, just ring me ;)

Thanx for all help...

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Re: Bonus and cargo income

Post by CAPFlyer » Sat Nov 27, 2010 3:57 pm

First, on the UPS data - please provide a link where that data can be found without filling out shipment information or a charter request (the reason for this is because if you filled out a charter request or a shipment form, you have received a confidential quote and it says so at the bottom of the page, thus it's not actually public information).

As for the longer flight making more money, that's not necessarily true. Your 2T more cargo over the longer distance means you burned more fuel. Fuel burn is not a linear cost because it takes more fuel to transport a greater payload over the same distance. When you multiply that same increase by 2x, then you start having the same problem. You have to understand that the whole thing is MUCH more complicated than you realize. The same occurs with passenger aircraft. Just because you can fly 5000 miles in a 747 doesn't mean you should because at that range the cost of making the flight may be more than you can recover with your seat sales unless you make the tickets extremely expensive. This is why you see a lot of flights with aircraft not using their full range capability. Aircraft are not infinitely profitable as you increase range. There is a "sweet spot" for all of them and you've found it for the 777F, somewhere between 3 and 10 hours. I wish I could share with you the data I had developed for aircraft I worked with that showed the bell curve of profitability, but I can't because it uses data that was proprietary to my employer. Suffice it to say, we could make a very short flight profitable and a very long flight profitable, but the prices to do so made it unlikely we would get a customer to select us at that price. Finding the "sweet spot" is why airlines have large flight planning staff and an even larger staff of accountants.

Also, the big problem we have and really no way to solve is the effect of fuel contracting, something the real world airlines can do to control their fuel costs (which is what you saw the effect of). We try to compensate for that somewhat by keeping the fuel prices "suppressed" by several dollars from retail prices, but we still can't fully compensate for it.
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Re: Bonus and cargo income

Post by mr.shiljo » Sat Nov 27, 2010 4:33 pm

Yes ok...its true, and UPS data are from shipment form...but how can they be confidential if everybody can access them ;) ??

Ok never mind, your right in most ways, but its anoying when i fly 10 hrs and make 3 times less then 5 hrs ;) makes no sense to me, i doubt its like that in real life...Try with that UPS data...Try to put some data with same cargo on that distances and youll see how income varies, no way flight on 5 hrs would cost you more then 10 hrs ;) I dont know, really makes no sense to me...

Ok...thank you for your info, man learn why alive ;) C u online i guess ;)

Best wishes

p.s.: and pls i still cant book from dispatch office...its all in support, others issues can close ;)

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Re: Bonus and cargo income

Post by CAPFlyer » Sun Nov 28, 2010 6:56 am

I know you want to believe that it's not true in real life, but being that I've done the job in the real world and seen the real world consequences of poor planning and execution and how they can affect an airline, please believe me when I tell you that just because it says something on a website, even on the shipping form, doesn't mean it's 100% of the whole story, especially since the form you're using is for a charter operation, not package freight as part of a bigger flight which is by far the majority of UPS's revenue. Please just accept that we are operating on a system that is similar to the real world pricing schemes and ensures that revenue is comparable to what is gained in real life without becoming overly complicated and taxing on the network to perform.
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Re: Bonus and cargo income

Post by mr.shiljo » Sun Nov 28, 2010 1:33 pm

No problems, just dont understand that, no more argue necesery...;) So no more flights over 5 hrs beacuse no profit is from them ...

Best wishes...

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Re: Bonus and cargo income

Post by mr.shiljo » Sun Nov 28, 2010 6:14 pm

Hm...sry but i must be boring...744F flight 5 hrs, from tihomir markus from Croatia cargo...86 T of Cargo...70t bought fuel...190.000v$, me karlo Šiljevinac , 777F same flight, 74T of cargo (10 less) , 36t bought fuel and 1.360.000 v$ ???? In symple account 747F income should be something 60% (cca. 800.000) of 777F. 2 times more fuel (50%less income cause of fuel) and 16t more cargo...Now u tell me its possible? Ok double fuel bought, but cmon...16T more cargo...maybe that bonus stuff, really dont know but its really anyoing flying arround full of cargo for some small cash ;) Something not quite good here in formula in metter of Cargo trnsfer..., pure cargo transfer...I simpy cant imagine 747F flight on 8 hrs flight, will be in minus, i will be paying to costumer just to fly ;)) Maybe realyl to change that bonus stuff...somethong wierd on that bonus for me...

my opinion is that airlines must provide their own price...not that i have INCOME but that i GENERATE income...like passengers airlines, they can rise ticket cost, why cant we rise cargo price...would be fair, so on flights which my airline fly mostly cargo, i can raise my own cargo if i fly only one on that route...

Fuel price is somewhere arround 0.90, price of 1.23 $ can be, but why multiply with 1.234?? in my opinion 0.9 * cargo...or else, depends on airport, but from 0.9 - 1.2$, cargo price should be regarding distance...so from 2$ to 6$ regarding distance...thats how will be logical...

But ok i will accept this system like it is, no trouble, but i had to say all of this, because it really dont make sense sometimes...;) sorry for beeing honest. At the end its your system, its great job and dont want to send you guys bad words, only words of gratitude you did a great job...

Best wishes

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