Route Profitability Analyzer
Compare the financial performance of your different train routes. This tool helps you make strategic decisions about which routes to prioritize, optimize, or potentially discontinue.
Identify your most and least profitable routes with clarity.
Justify deploying your best assets and marketing to top routes.
Make data-driven decisions when considering new route expansions.
Results
Enter values and click Calculate to see results
Understanding Route Profitability
Analyzing route profitability goes beyond simple revenue. It requires a careful allocation of both direct and indirect costs to understand the true financial performance of each route in your portfolio.
Key Concepts:
- Direct Operating Costs: Costs that exist only because the train is running (e.g., fuel, onboard staff).
- Route-Specific Costs: Costs tied to a specific route, not just any journey (e.g., marketing for the 'Mountain' route).
- Indirect Costs: Overhead costs that support the whole company, which must be allocated fairly across all routes.
- Contribution Margin: Shows how much profit the route 'contributes' to covering fixed and indirect costs. Calculated as
(Revenue - Direct Costs) / Revenue.
A route can have a healthy contribution margin but be unprofitable after all costs are allocated. This tool helps you see that full picture.
Frequently Asked Questions
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