Very few companies have managed to maintain progress over the years of their existence, and Dnata is one of them. Since the very start of the business, only the most recent innovations were used to develop the company’s strategy and only the latest technologies were utilized to provide the services of decent quality.
However, over the past few years, the Dnata Company seems to have been experiencing considerable difficulties concerning the cost for the fuel and the related issues. Therefore, making the costs for the fuel to repay themselves is a topical issue for the Dnata Company at present.
Though one might think that the fate of a single company in the light of the crisis that has engulfed several major corporations all over the world since recently is not an issue that is worth considering, the future of Dnata means much for the UAE.
First, it is important to mention that Dnata is one of the major companies in the UAE and the key transportation service in the state; therefore, it plays a great role in the UAE business system, not only as a travel agency, but also as the link between the UAE and the rest of the world.
Given the fact that Dnata also offers a perfect example of a continuous progress, it is especially intriguing to see how the company is going to handle the current crisis.
As it has been mentioned, Dnata is currently having certain difficulties in the financial department. To be more exact, because of the recent rise in the price for the fuel, the company can hardly make the ends meet.
Because of the rapid increase in the price for the fuel, the cost price of the latter nearly equals the revenues that the company gets from transporting the customers, which means that Dnata is on the verge of a financial crisis.
It is clear that at present, the issue of the costs for the fuel is a great problem for the airlines, for the recent evidence shows that the company has decided to cut the costs for the fuel: “Keeping those planes in the air cost Emirates 24.3 billion dirhams in fuel costs in the 2011/2012 financial year, 40 percent of total costs and up 44.4 percent from the previous year, the company annual earnings report said” (Menon & Stevenson, 2012).
Judging by the fact that the firm’s annual revenues have dropped greatly, it can be considered that the Dnata Company is suffering from a severe financial crisis. It is important to keep in mind that Dnata’s costs are not restricted to paying for the fuel; the company also needs to pay for the maintenance of the planes, the services of pilots and flight attendants, etc. Hence, it can be concluded that the company is about to face a tough crisis.
As it follows from the information offered above, the key question of the given research will be whether Dnata is able to survive the given crisis and if so, then what its key strategies are going to be.
Speaking of the research hypothesis, it can be assumed that the Dnata Company could use the help of other companies, such as the Al Ahli Club (Ajou, 2012). Using the financial support of other companies, Dnata can rethink and change its financial strategy so that it could suit the existing environment.
It is worth mentioning, though, that the given research has many limitations that might influence the final result. To start with, it is hardly possible to predict the precise number of future customers that are going to use the Dnata services. In addition, the outcomes of Dnata’s cooperation with the Al Ahli Club are yet to be seen. The last and the most significant limitation concerning the given research is the price for the fuel.
Even though the current trends concerning the price for the fuel can be analyzed to make further predictions, it is still clear that the fuel costs are very hard to control. At present, there are obvious tendencies in the increase of the price for the fuel.
However, the exact amount of money that the price is going to increase in is still unknown. Therefore, in case the research results contain several rather radical statements, the latter should be taken with a grain of salt. Though the major conclusions are still going to be trustworthy, it can be assumed that the research data is going to be approximate.
Although dealing with financial issues now means facing a great challenge for the Dnata Company, there are still strong indications that the company will be able to get over the given crisis.
Therefore, the prognoses for the research outcomes can be described as positive especially given the recent collaboration between the Dnata Company and the Al Ahli Club. However, the unpredictability of the Dnata situation still makes a great case for an enthralling study.
Reference List
Ajou, N. E. (2012). Dnata and Al Ahli Club, Dubai join forces. Web.
Menon, P. & Stevenson, R. (2012). Emirates hit by fuel costs, sticks with expansion. Web.