What does revenue management focus on?

Revenue management primarily focuses on maximizing revenue through pricing strategies and inventory control. This practice is especially crucial in industries where the product or service is perishable, like airlines, hotels, or car rentals, where unsold inventory (empty seats, unbooked rooms) cannot be recovered once the service date has passed.

By analyzing consumer behavior, demand patterns, and market conditions, companies can adjust their pricing dynamically and strategically allocate inventory to maximize the total revenue generated. For instance, if demand forecasts indicate a surge in interest for a particular flight, the pricing may be adjusted upward, while during low demand periods, prices may drop to stimulate sales.

While the other options involve important aspects of business management, they do not encapsulate the core idea of revenue management, which is specifically centered around optimizing pricing and managing inventory to drive profitability.