Southwest Recommendation
Increase Market Research Southwest Airlines is practicing a conservative growth strategy. The airline focuses on growing internally and expanding within their current routes. It is estimated that in any given year, 85% of Southwest’s expansion is internal. The company purchases new planes to add capacity to their system. By next year, they will be using 14 to 16 new planes for internal expansion. At times, Southwest expanded externally, but only when an opportunity was present. The company faces a problem with expansion. Southwest Airlines is asked to join new markets where they cannot meet the demand. The company does not have sufficient facilities and must expand in a controlled manner. In order to help solve the problems of expansion, Southwest Airlines should increase their market research. Generally, Southwest Airlines fly into airports of smaller; less congested cities (see Figure 3). This strategy was implemented to reduce taxi time, gate holds, and in-air waiting. However, more consumers complained that it was harder for them to get into larger cities when flying with Southwest. Southwest should expand by purchasing more planes to fly into larger cities. As mentioned earlier, Southwest Airlines faces the problem of expansion by not meeting the demand of other markets. Recommending Southwest to invest in researching new areas and finding new facilities to use would assist them in external expansion. The company focuses on a very particular strategy. Southwest Airlines has experienced success with their current strategy, but are still facing various problems. Southwest should not incorporate a new strategy but should integrate smaller strategies in order to reach optimal success. By investing in new areas and searching for new facilities, Southwest Airlines could prevent the lack of expansion. By expanding to larger cities, such as Charlotte, Pittsburgh and Charleston, the company would increase their consumer market and satisfy their customers.