North Yorkshire Moors Railway General Discussion

Lost for words? You should be after the post from Railfan16!

 

An assumption that is based on the level of demand shown in a holiday period. The decision not to run on all weekdays this week ensures that net income on those days is zero. A considered risk to operate at a time when demand is generally robust gives a significant chance of extra revenue, and a low chance of costs exceeding revenue. I know, as a trustee, where I'd tend to put my cards.

 

If the railway has decided to run seven days during the half term weeks next year then it's clear that they know this year's strategy was a mistake. Defending it seems laughable.

 

If there is serious overcrowding on the five days it may be the decision was wrong during half term and needs to be changed in future. However, it dosesn't follow that spreading demand over more operating days must produce a better overall financial result. That would only be the case if the additional operating costs are more than covered by additional passenger revenue. It might equally be argued that if demand on five operating days results in overcrowding then charging higher fares on those days might produce a better visitor experience and financial outcome.

 

Was that the shortest AGM in years?

 

According to most people's instinctive thinking (but not yours, obviously!) charging higher fares would be likely to turn more people away from travelling - possibly resulting in a loss of revenue to counteract the higher fares, and possibly resulting in more adverse "word of mouth" advertising. Still it might get rid of the riff-raff, and create more of a "premium" experience..... A simpler answer might to be to increase train lengths to the maximum permissible.... Bring back the KX suburban carriages! SLOs would do the job nicely!

 

It wouldn't be a 'better visitor experience' for those who couldn't afford it though.

Obviously we all want heritage railways to achieve financial success (i.e. at least break even), but some are pricing people out of a chance to share that heritage experience. Perhaps shorter cheap journeys can cover the bottom end market while offering full line journeys for those who are better able to afford it. Obviously there may be logistical issues* with trying to do that, but as a general ambition something that might suit some of the longer railways.

* previously discussed on this thread, so no need to go into it again now.

 

An ex company Chairman of ours was quite keen on pointing out that many of our passengers had spent Monday - Friday standing on crowded trains going to work, and didn't want to repeat the experience as part of their leisure.

A consequence of that is inevitably you will carry some empty seats and need to run trains longer than loadings strictly suggest - particularly I'd suggest where the journey is already over an hour. It's fashionable to decry the waste inherent in "carrying empty air" but some waste is necessary if the alternative is to be avoided, which is overcrowding.

You can see that when trains load: a compartment with four people in that seats 8 will be avoided unless there is no choice; likewise a table for four that already has a couple sat at it will be avoided by a second couple unless there is no other choice. Once you are so crowded that people are standing, you are making this unpleasant for most people - not least if they cam't get to the loos and / or buffet!

We are back to the fixed and variable costs thing again: additional capacity can generally be carried at fairly low marginal cost. Better to do that than generate customers who haven't enjoyed their day, particularly because while those delighted by the journey frequently don't share their experience, those who had a bad time often do for all to see.

When the response to (what is actually a luxury problem!) overcrowding is "let's increase prices" my head just sinks.

Tom

 

What has been clear to me this week viewing posts on X, is that quite a lot of people like to visit the railway in the final week of normal operations, for a final fix of Moors railway travel, both steam and diesel aficionados making the effort, some not from the region make a short break of it.

Sawdust.

 

You are right in most respects but "you are making this unpleasant for most people - not least if they can't get to the loos and / or buffet!" is wrong - on the NYMR the buffet is most likely closed and if you are lucky a trolley will be making its very slow way past the standing passengers till its pitiful supply of tepid water runs out......

 

Apparently the catering trolleys have all been scrapped.

Sawdust.

 

Certainly the most pointless

Schools announce holiday dates, including half-term breaks, at least one year (sometimes two years) ahead.

Why the NYMR have taken no account of this is another question for one of their 19 administrative staff, 5 of whom are allegedly employed to market the line. The other 14 are involved in financial matters, mainly losses. (Apologies - slip of the keyboard fingers there. I meant negative profits).

Perhaps they are just trying to emulate larger rail franchises. After all Sundays are reasonably predictable in frequency yet they always seem to take Northern by complete surprise.

 

To be frank, the decision to shut any day of school holidays is ridiculous for this railway. I can take closing quieter days of the week outside of holidays, but when schools are off in the region, the railway should be running. You can't sell tickets if there isn't a train.

Secondly, I believe the trains were only load six this week. If that is the case that's also ridiculous. There should be more than enough data there to know when to bolster the sets, and when to reduce. Somebody should be looking at those numbers and putting instructions out to make sure that the school holidays, and last week of the main timetable, when demand will naturally be higher than the preceding weeks when sets have been running as sixes, need an extra coach added.

Once again, this is just basics.

 

@Jamessquared is absolutely right about pricing off demand - it's a bizarre strategy that will narrow the demand base when one of the key challenges is how to keep demand as broad as possible

More generally, you make a very significant assumption about the nature of demand here, which is that total demand is fixed and therefore the level of service is about the distribution of that demand. It is a version of the mercantilist fallacy which presumes that growth in one place must lead to decline elsewhere, which has been repeatedly falsified.

The consequences are significant. I've no issue whatsoever with the general point about matching service levels to demand, and seeking to avoid running unremunerative trains (though there are several devils lurking in the detail). But this view, if adopted, denies both the ability to induce demand through providing a service, and the deterrent effect on demand of not providing a service. I will then mention, again, the question of fixed vs. marginal costs, and the importance of generating cash - even where a train doesn't directly cover its share of fixed costs, if it more than covers the marginal costs of operating (shorn of any loading for fixed costs), it will make a positive contribution to the overall financial performance of the organisation.

 

What's even more baffling than shutting the line for two days in half term is that it's open next week for two days for the diner to run. I also notice that you can book a table of 4 for two people and pay £45 for each empty seat. That means the dining part of the service is about £55 per person. £45 x 96 seats = £4320. But they've only sold about 70 seats for each day so it's actually about £6500 income from the two services.

For each day, the railway then requires three or four signallers, two loco crew, guard and station staff. Income for the railway after consumables (coal, oil and water for the loco, etc) are paid for, maybe three grand per day. Yet three rakes of 7 coaches with 300 people on each paying £40 a time isn't worth their bother. Even running a one set with seats for 20 quid would bring in much more money than the diner!

 

I agree with your analysis and acceptance that running unremunerative trains is to be avoided. The question remains whether if you spread demand over more operating days it generates additional income in excess of the increase in marginal cost
. Fares have long varied by distance travelled and also by peak/off peak season. Varying them in response to demand may not be traditional but might be the sort of out of the box thinking that the sector needs to consider. Dynamic pricing is increasingly used elsewhere. Why would it not work for heritage railways?

 

As you haven't quote anyone, I'm not sure who the "you" is in your comment "I agree with your analysis".

On dynamic pricing: yes, some leisure businesses use it, but I'd suggest it is far from popular, so good luck with the PR aspect if you were to introduce it!

That's not to say you might not consider a simpler model, but I think I'd be looking to drive traffic to trains that have to run but are always lightly loaded, rather than as a means to price people off popular services. As an example (and reduced to almost as simple as possible) - suppose you ran a single train service that was

Pickering dep 10:00;
Whitby dep 12:00
Pickering dep 14:00
Whitby dep 16:00

Service data shows that most people travelled out on the 10:00, and back on the 16:00, and the intermediate services were lightly loaded. You might in that case think about offering a cheap ticket from Whitby but which had to be used on the 12:00 out / 14:00 return, which otherwise has very little utility, not allowing much time on the railway to do much except perhaps grab a quick coffee at Pickering.

Now that is not a real example, just illustrative. You will have access to the actual passenger flows: if you were aiming for any kind of dynamic pricing, I'd be looking to see "how do I drive demand on services I am already running but which don't load well" rather than "how to I price-gouge the popular services". For a tidal line, that likely means incentivising people to use the counter-tidal services.

Tom

 

I suggest that dynamic pricing is a high risk strategy. It has worked economically in a number of high profile cases (e.g. the Oasis reunion) where demand far exceeded supply, and the promoter didn't need to worry about the long term relationship with the customer. Even then, the blowback was significant and caused collateral brand damage. Similarly, where applied on rail or airlines, it undermines trust and is typically only accepted where it offers significant discounts against the "normal" fare.

Applying that concept to a heritage railway seems tricky. I see limited room either to discount or to boost fares, while introducing that as a model would reduce trust.

The heart of the challenge will be the willingness to book in advance. You will have an idea for NYMR data; other railways will have their own data. But if most demand is either on the day or short term, that suggests that demand based pricing would probably not be especially effective - and if it's ineffective, that is likely to reinforce the tendency to offer discounts.

 

Firstly all school holiday periods do warrant 7 day a week operation. The problem is, leisure activities are most often spur of the moment decisions. Dynamic pricing would require advance bookings for specific trains, which hasn't been terribly successful anyway, although the E&BAR do this successfully.

Sawdust.

 

Success that depends on a core customer providing coach traffic, and which does not encourage general public traffic.