Answer :
The criterion needed for an industry to unlock the full potential of revenue management typically includes a fixed-capacity environment, predictable demand, and time sensitivity. However, low fixed costs are not a requirement for effective revenue management, hence the correct answer is option (4).
Industries with significant fixed costs can still utilize revenue management effectively. Factors like price responsiveness of demand, forecasting demand, and managing supply and demand through strategies like pricing and promotions are key aspects of revenue management.
It's important to understand that revenue management can thrive even in situations where fixed costs are high, but the ability to manage and predict demand effectively is a crucial component. The elasticity of demand and the use of variable costs to adapt to fluctuating demands are vital as well.
Peak pricing strategies during high demand periods or promotions during low demand can help align capacity with demand levels, which is at the core of revenue management. Regardless of the level of fixed costs, successful revenue management depends on the capacity to forecast demand accurately and to adjust pricing and other market strategies to optimize the use of fixed resources.
Low fixed costs are not a necessary criterion for an industry to fully leverage revenue management, as effective demand forecasting and price responsiveness can compensate for high fixed costs.
