Avis 2013 Annual Report Download - page 17

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7
and we have eliminated or reduced significant costs through the integration of Avis Europe in 2012 and
2013. In addition:
We continued to develop and implement our Performance Excellence process improvement
initiative to increase efficiencies, reduce operating costs and create sustainable cost savings
using LEAN, Six Sigma and other tools. This initiative, which we have expanded to cover our
operations in Europe and Asia, has generated substantial savings since its implementation and is
expected to continue to provide incremental benefits.
We have implemented initiatives to integrate Payless and Zipcar, to realize cost efficiencies from
combined maintenance, systems, technology and administrative infrastructure, as well as fleet
utilization benefits and savings by combining our car rental and car sharing fleets at times to
reduce the number of unutilized Zipcars during the week and to better satisfy Zipcar’s unmet
weekend demand.
We have also continued to implement technology solutions, including self-service voice
reservation technology, mobile communications with customers and fleet optimization
technologies to reduce costs, and we will further continue to pursue innovative solutions to
support our strategic initiatives.
We believe such steps will continue to aid our financial performance.
In executing our strategy, we plan to continue to position our three distinct and well-recognized global brands to
focus on different segments of customer demand, complemented by our other brands in their respective regional
markets. With Avis as a premium brand preferred more by corporate and upscale leisure travelers, Budget as a
mid-tier brand preferred more by value-conscious travelers, Payless and Apex as deep-value brands and Zipcar
offering its members an economical alternative to car ownership, we believe we are able to target a broad range
of demand, particularly since the brands share the same operational and administrative infrastructure while
providing differentiated though consistently high levels of customer service.
We aim to provide products, services and pricing, to use various marketing channels and to maintain marketing
affiliations and corporate account contracts that complement each brand’s positioning. We plan to continue to
invest in our brands through a variety of efforts, including television commercials, print advertisements and on-line
and off-line marketing. We see particular growth opportunities for our Budget brand in Europe, as Budget’s share
of airport car rentals is significantly smaller in Europe than in other parts of the world, and for Zipcar
internationally, where the brand’s proven car sharing model can be expanded into numerous geographic markets.
We operate in a highly competitive industry and we expect to continue to face challenges, including uncertain
economic conditions, particularly outside of the United States. We seek to mitigate our exposure to risks in
numerous ways, including delivering upon the core strategic initiatives described above and through continued
optimization of fleet levels to match changes in demand for vehicle rentals, maintenance of liquidity to fund our
fleet and our operations, and adjustments in the size, nature and terms of our relationships with vehicle
manufacturers.
OUR BRANDS AND OPERATIONS
OUR BRANDS
Our Avis, Budget and Zipcar brands are three of the most recognized brands in our industry. We believe that we
enjoy significant benefits from operating our Avis and Budget brands to target different rental customers but share
the same maintenance facilities, fleet management systems, technology and administrative infrastructure. In
addition, we are able to recognize significant benefits and savings by combining our car rental and car sharing
maintenance activities and fleets at times to reduce the number of unutilized cars and to meet demand peaks. We
believe that Avis, Budget and Zipcar all enjoy complementary demand patterns with mid-week commercial
demand balanced by weekend leisure demand. We also operate the Apex and Payless brands, which operate in
the deep-value segment of the car rental industry and augment our Avis, Budget and Zipcar brands.