TRUCK RENTAL PRICING APPLICATION

SUPPLY CHAIN SOLUTION LTD

Table of Contents
1 Introduction ................................................................................................................................3 2 Requirements ..............................................................................................................................4
2.1 Operating system ................................................................................................................................. 4 2.2 Technologies ......................................................................................................................................... 4 2.3 Hardware .............................................................................................................................................. 4 2.4 Software ................................................................................................................................................. 5

3. Scope of the Application ..........................................................................................................6 4. Technologies/Tools Used ........................................................................................................7

4.1 Pro*C ...................................................................................................................................................... 7 4.2 Toad ....................................................................................................................................................... 7 4.3 Unix shell scripting ............................................................................................................................. 7 4.4 Autosys .................................................................................................................................................. 8 4.5 SAS ......................................................................................................................................................... 8 4.6 Fortran....8

5. Overview of Pricing applications ...........................................................................................9

5.1 LPSS (Local pricing support system) ................................................................................................ 9 5.2 DP2 (Directional pricing) .................................................................................................................... 9 5.3 YM (Yield Management) ................................................................................................................... 10

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1.Introduction
Truck Rental Pricing Application is used to derive rates for renting trucks and other accessories like Two Dolly etc. Pricing is done to acquire the maximum possible market share at best price. It is basically done for Local and One-way rentals. Within fleet of 15 truck types, rates are not provided for all truck types and separately not for every dealer location but they are provided for few truck types and applied to all. Pricing goals include Provide best price in the market with an aim to acquire maximum market share. Generate maximum revenue, enhancing the sale of insurance provided by BTR. Transferring trucks to another region, if a truck would generate more revenue at that location. To turn down the truck, if it is not making money. Drive up the demand as and when required. Price break-up types -Local -One-way Consumer types -Residential -Commercial

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2.Requirements
2.1 Operating System:
Scenario Required Operating System

Client Server

Any Windows family (Windows 95 and up)

UNIX Operating System, SunOS 5.8

2.2 Technologies Used: The following technologies & tools are being used in Pricing applications:

Oracle 10g database Unix Shell scripting Pro*C / C Fortran SAS Power Builder 6.0 Autosys VB (Visual Basic) Toad 7.1.7.1 Citrix Metaframe Client

2.3 Hardware:
Scenario Client Component Requirement 256 MB of RAM 800MB Free Space 256 MB of RAM 3 GB Free Space

Memory
Space

Server

Memory Space

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2.4 Software:
Scenario Client Required Software/Tools

Server

Oracle9i Client Toad 7.1.7.1 Power Builder 6.0 Citrix Metaframe Client ORACLE 10g Sun Studio 10 Sun C 5.7 Sun Fortran 95 8.1

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3.Scope of Application

Pricing application is developed to generate and maintain rates of trucks for BTR. It generates and maintains following information related to prices of trucks. Local Pricing: Rates related to local rental (where the origin and destination dealer is same). OneWay Pricing: Rates related to One Way rental (where the origin and destination dealers are different). Discounts: Rates related to some special discounts on particular lanes and for particular dates. Special Events: Information regarding some Local Pricing special events and rates applicable on those special events. Competitor rates: Information regarding competitor rates for the trucks and for all the possible lanes. Calenderization: Based on the usage & demand of trucks during any calendar month Calendarization enables to either increase or decrease price from the base price.

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4.Technologies/Tools Used
Various tools and technologies are used while working with Pricing applications. Some of them are briefly described below:

4.1 Pro*C: Embedded SQL is a method of combining the computing power of a high-level language like C/C++ and the database manipulation capabilities of SQL. It allows you to execute any SQL statement from an application program. Oracle's embedded SQL environment is called Pro*C. In Pricing applications Pro*C programs are used to accomplish various business requirements and interacts with the database through extraction programs or other data manipulation statements.

4.2 TOAD: Toad for Oracle is the product that almost all other Oracle Development and Administration tools are compared against. The product began life in 1995 and essentially pioneered the category of Oracle Development tools. Toad is also one of few database development and administration tools that have expanded to include support for various database technologies. The range now includes Toad for Oracle, Toad for SQL Server, Toad for MySQL and Toad for DB2. With an increasing number of organizations employing a blend of database technologies the practicalities of having an application suite that provides DBAs and Developers with a consistent interface across all platforms is particularly attractive.

4.3 Unix Shell Scripting: A shell script is a script written for the shell, or command line interpreter, of an operating system. It is often considered a simple domain-specific programming language. Typical operations performed by shell scripts include file manipulation, program execution, and printing text. In Pricing application context mostly all the jobs are developed in shell scripts and through these shell scripts other programs such as SAS programs, Pro*C programs or Fortran programs are called which further interact with database or various flat files.

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4.4 Autosys: Autosys is a product from Platinum; it is a job scheduling software. Basic job scheduling is done using UNIX - Cron. Cron is time based, i.e jobs are executed based on their scheduled time. However, in real business, you need to fire jobs not just based on scheduled time, but also based on events (like an arrival of a file), and, based on the success or failure of other jobs. Autosys is a total job scheduling solution that allows you to define these events, dependencies, time schedules, alerts, etc. making it a complete data center automation tool. In pricing application context Autosys is used to schedule and run various daily jobs used by pricing applications.

4.5 SAS: SAS System is a computer program for entering and analyzing data. However, it is much more than just a program for 'doing' Analysis of Variance. SAS can be used for entering data, storing and manipulating data much like a spreadsheet program, using SAS/CALC. SAS can read in data from common spreadsheets and databases, output the results of statistical analysis in tables, graphs, in Rich Text Format (.rtf) [for input to Word], in Portable Document Format (.pdf) [for reading with Adobe Acrobat Reader] and in HTML format (for directly publishing on the 'Web') and much more. In the application sas files are run through sas_sh by sending the .sas file as parameter which contains input and output files and the references to them, which are used in the sas program called from this file.(path for sas file usr/ym2tst/sas10/ ) Example: Reference file type/the actual file

filename dp451d06 "&filein/DP451D06.OW";

4.6 Fortran: Fortran is a general-purpose, procedural, imperative programming language that is especially suited to numeric computation and scientific computing. Originally developed by IBM, It is one of the most popular languages in the area of High-performance computing. In the application it is used to format data. Both input and output files are specified in the .unt file passed as parameter to it, this file also contains the reference numbers assigned to input and output files which are used to access these inside the fortran program for read and write operations. (path for a .unt file usr/ym2tst/data/OLD/19--/ )
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5.Overview of Pricing Applications

5.1 LPSS (Local pricing support system): The Local Pricing Support System application provides a local pricing analyst the capability to review, approve, and override rate recommendations generated by LPSS at the Local Pricing Matrix and Team levels. At the end of each day, all approved rate recommendations are transmitted to the Reservation Systems. This application also allows the analyst to maintain and control some of the vital data used in generating rate recommendations such as base rates and days left grids. There are also other maintenance features that allow the analyst to control some of the recommendation throttles such as minimum and maximum rates and thresholds controlling the automatic approval of rate recommendations. Finally, there are features that aid in the approval of rate recommendations and the setting of recommendation thresholds such as Market Statistics and Outside Min/Max Rates.

Upon startup of the application, a login screen is displayed where the user can enter user id and password. After the user successfully logs onto LPSS, the application automatically displays the Recommended Rate window with the Option tab in the foreground. From this point the user can choose to work with the Recommended Rate window, reviewing, approving and overriding recommended rates. The user can also choose to work with any of the other features such as maintaining base grids or reviewing which rate recommendations exceeded the minimum and maximum rate thresholds.

5.2 DP2 (Directional pricing): The main functionality of DP2 system is to maintain parameters used for pricing the following products: Trucks: Vehicles rented by customers for the purpose of moving. Trucks are categorized into 5 different types identified by their length i.e 10, 15, 16, 20 and 24. Protection products: Damage Waivers and types of coverage that a customer can take with the rental. Accessories: Additional articles used in the move. Eg. Hand trucks, furniture pads, etc. Towing equipment: Equipment used for towing automobiles behind the rented truck.

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DP2 only handles pricing for One Way rentals, i.e. the rental form where the truck is returned to a different dealer then where it was picked up from. Pricing is based on a geographical area called a Matrix which typically is of the size of a city. Matrices are ordered in a hierarchy containing State Areas, States and Corporations. Individual dealers are associated with one (and only one) matrix but all pricing is performed on the matrix level i.e. the price for a rental from a certain dealer to any dealer in another matrix will be the same. In technical and storage terms, each matrix in the system is associated with 1 (and only 1) Rschedule. The schedule holds product usage lines, each of them contain fields (columns) that can be changed and can be described as: The product type abbreviation: TR for Truck, TD for Tow Dolly, etc. The specific rate schedule based on which the cost of this product will be calculated. Schedules are used to calculate the rate for each product type except trucks. Truck rates are calculated by Yield Management. The following cost schedules are used: - F-schedule based on a fixed rate by matrix (e.g. 12$ for matrix A3104), typically used for accessories like furniture pads. - D-schedule based on a fixed rate by length of rental (e.g. $10 for 2 days, $30 for 6 days), typically used for Personal Accident/Injury and Cargo (PAI Cargo, PAC CCO), which is a protection product. - X-schedule based on fixed rate by mileage segment (e.g. up to 80 miles: 180$, up to 280 miles: $40), typically used for towing products. 5.3 YM (Yield Management): Six mathematical models comprise the YM system: Yield Management Demand Model Supply Model Value Model Competitor Model Pricing Model Transfer Model

Demand Model (Forecast) The Demand Model consists of programs that are used to forecast expected traffic(or demand) for one-way moves, local moves, and transfers. The forecasts are calculated using historical contract data for each truck size, origin and destination pair, and move duration.
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Forecasting is performed in stages to achieve the best possible accuracy. Forecasts are developed at the quarterly, monthly, and daily levels and then combined to produce the final forecast. The final demand forecast is then adjusted based upon reservation data to produce a more accurate forecast.

Supply Model (Forecast) The Supply Model uses the results of the Demand Forecast and the inventory information from the CDR (Central Data Repository) to calculate future truck supply. Truck supply is calculated by truck size for each matrix and each forecasted day of a 4-week forecast. The calculation takes into account the following information: Forecast for local moves, one-way moves, and transfers Move duration Starting on-lot inventory Inventory due-in in each matrix

Next, the model calculates three supply figures for each matrix: Standard, Standard Net, and Conservative Net Supply. Each figure varies only in the conservativeness of its estimates of available future supply.

Value Model The Value Model calculates the value of small and large trucks in each market for the forecast period (28 days). This model uses the results of the Demand and Supply models along with cost and price information to calculate the value of a truck in each matrix. The value of a truck on any given day is the total value of all future local, one-way, and/or transfer moves.

Competitor Model The Competitor model downloads survey data from Directional Pricing and incorporates the data into the YM database for use in the pricing model.

Pricing Model The Pricing Model determines truck prices for one-way rentals. The price calculations are made using all relevant market information, such as demand, supply, value, costs, and
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competitor rates. The pricing model first determines whether to reprice a lane (for a given size) based on a number of different rules. Flagged lanes are repriced using various heuristics that consider the inventory levels, values, costs, and other parameters supplied by the revenue managers.

Transfer Model The Transfer model recommends moving rental trucks to locations with the greatest demand, to maximize revenues. The model proposes transfers between locations only if the value generated by the move exceeds the transfer cost. The Transfer model uses the results of the Demand, Supply, and Value models along with constraints supplied by the revenue managers. These constraints include limits on the number of trucks that can be transferred between matrices, or budgetary or cost limitations.

Calendar Model The Calendar model allows the users to setup calendarization in YM to be sent to Directional Pricing and later to the reservation applications. There are complicated algorithms in the calendar model, it merely takes user parameters and applies them across any hierarchy.

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