It is annoying to see the annoying company Ryanair – whose motto I imagine to be “if they’re stupid enough to fly with us, they’re on a mental level with sheep and should be treated as such” – given occasional credibility over ludicrous ideas without anyone asking the straightforward question.
Such as: would implementing that idea actually cost Ryanarse money, or profits?
When Michael O’Leary makes a stupid pronouncement, the media seems happy to repeat it. None seems happy to examine it and throw it back at O’Leary to ask whether he has lost his mind and is trying to annoy his shareholders as well.
For instance: charging people to use the toilet. (That’s a Google search link: the top link at the moment is to an April 2010 story saying that Ryanair is going ahead with it… and the third link is from February 2009, with “pilots aghast at proposal to bring in £1 charge”, which shows you how long this story has been bing-bonging around the mediasphere.
Let’s examine this the way it should be examined: from a business standpoint. If Ryanarse starts charging for access to the toilet, I think it will lose money. Here’s why.
If Ryanarse starts charging for the toilet, fewer people will use it. Obviously. It may also have to do more cleanups from parents of young children who run out of money. It’ll also have to get staff to watch over the toilet to make sure people don’t hold doors open for each other – which will be unpopular with the aircrew, since nobody like to be toilet cop.
So it will get a bit of money from people paying to use the toilet, though there will be fewer visits – meaning that the fixed cost, cleaning the toilet reservoir, will only be slightly offset by the takings. And aircrew will have two new grievances: cleanup and toilet cop rota.
But while Ryanarse makes some money from selling toilet access, it will lose money from sales of coffee, tea and other liquids. This is stupid, because it already has the highest prices for coffee and tea and food according to a 2008 survey by Which? Holiday:
The Irish airline charges £2.50 for a bottle of water and £2.50 for a cup of coffee while a small bottle of red wine costs £5.00.
Why will it lose there? Because people will think “Hmm, if I drink this coffee I’ll have to pay for letting it out too.” So the passengers won’t buy the coffee or use the toilet. Ryanarse is suddenly losing money: the profit it used to make on coffee/tea sales. And that is pure profit: apart from heating the water, pretty much everything that it buys for coffee/tea – instant coffee, teabags – can be reused on another flight if it isn’t used. Whereas the toilet reservoirs have to be emptied every time; it is actually more efficient to encourage their use – that way, you get your money’s worth for the cleaning services.
Michael O’Leary – who I think is despicable; if you want to think of the future driven by his credo, imagine Adam Smith’s invisible hand slapping the human face forever – ought to be able to see that charging for access to the toilet is a stupid move, economically. It would actually make better business sense to announce that the “toilet charge” will be rescinded – and raise the price on coffee and tea. In fact, expect it.
And if O’Leary is too stupid to see it, then perhaps his shareholders could show him this blogpost.
And finally, to the business press: next time O’Leary puts forward a stupid idea like this, ask whether it can make business sense. Think about fixed costs and operating costs. And quiz him. When he can see he’s going to lose, he caves in. I think if this is implemented, it will be a money-loser. But you’d need to ask the hard questions – how many drinks are sold per flight before, how many after, what’s the take – to know whether, when Ryanarse announces it’s not implementing (or is withdrawing) these charges, precisely why it’s doing it.
My suggestion: it won’t be because of an outbreak of warmth in O’Leary’s heart, which I imagine as a coal-black thing that would make Lord Voldemort shudder.