Category: ‘Pre-Trip Advice’

Client

The fundamental point to make in business travel is that the client is rarely the individual who is actually travelling. This presents a possible conflict between the interest of the company to keep costs low and the traveller seeking comfort and benefit from their trip. In order to avoid any ambiguity it is important to produce a defined Travel Policy which can be simply a set of parameters which are agreed such as class of travel, grade of hotel permitted etc. or more complex; including different classes of travel dependent on the duration of the flight, seniority etc.

Another area requiring clarity is that of airline loyalty schemes such as frequent flyer cards. The BA Exec card for example is seen as a highly powerful and prestigious tool. The choice of airline is often determined by the particular brand of card which the traveller holds and not necessarily by the most economical fare. Here the discrepancy between bill payer and traveller is evident and brings into question whether the traveller should benefit personally from the valuable air miles they accumulate.

Some companies take the view that this opportunity to benefit personally is offset by the likelihood for employees to be travelling at weekends, early mornings or generally unsociable hours. The chance to obtain ‘free’ air miles is then deemed as justifiable compensation. Other companies who pay staff overtime for travelling often take a different view to this.

While some loyalty programmes and the cards they represent are often highly superficial, there are some frequent traveller cards which, depending on their hierarchy, do have material benefits. Cards with specific airlines will enable the traveller to obtain seat number assignment on lower fares which would otherwise not normally provide advance seating. Forward row seating with extra leg room is in some cases available to cardholders at no charge, a privilege which would typically cost £100 or more each way. Certain cards provide ‘special handling’ and enable the traveller to skip the waiting list and obtain a confirmed seat when the flight would otherwise appear as full. Increased free baggage allowance is also another benefit free of charge which is provided by a selection of airlines.

My personal advice is to establish a clearly defined travel policy which includes the company’s position on matters such as air mile benefits e.g: ‘the lowest airfare must always be taken’ or ‘we will allow travel with the traveller’s preferred airline, providing the cost is no higher than a 10% increase compared with a competitor airline’s fare.

Jan, 22, 2015

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Self-Booking Vs Managed Travel

We have recently examined some of the leading corporate self-booking tools. With the ongoing trend among larger firms to encourage employees to book their own flights, we examine the pros and cons of this methodology.

Self-booking should be a transparent process, enabling the user to select from a choice of airlines, booking within the parameters of company policy and allowing the organisation to support preferred suppliers with appropriately negotiated fares. However, across the various systems we have sampled, we have found despite using highly specific search criteria, the results have been highly inconsistent. When asking for direct flights with a specific airline, we find that a combination of sectors are often displayed, at a different time of day to that requested. Looking closer, we have witnessed TEST fares displayed as opposed to actual fares and on many occasions a lack of last seat availability, leading to fares considerably higher than those displayed in native Global Distribution Systems.

Having the personal knowledge to know where to look for cost effective tickets which are refundable, have minimal cancellation fees or allow date changes can be invaluable to a business. Paying an extra £50 for example on a flexible fare is worthwhile if you can change the date free of charge (normal fee £100) or gain a full refund when cancelling (for example the average business class ticket is £1400)

Websites often do not contain the whole array of fares available from an airline, or the complete hotel/car hire inventory. TMC (Travel Management Company) staff are trained to look for special offers, seat sales, alternate routes and ITX fares (only available when booking accommodation with a flight). The fares are thus more competitive and more flexible than a standard fare.

An important question for businesses is clearly whether or not they would incentivise their staff to find cheaper options and whether they view this as a worthwhile use of employee’s time.

With a TMC, travel policies are generally put in place from the outset to minimise cost and to fulfil a duty of care to employees. You are also more likely to have full integration with other tools, specifically approval tools, expense systems and data services, as well as increased information for safety and security measures. A TMC will also be able to instantaneously track the location of all travellers. This is crucial should the unexpected occur, when dealing with an unforeseen events, disaster or the cancellation of flights.

In summary, the transaction process may be marginally lower, but how much is the unit cost? Can you be sure that you are getting the best deal?

Jan, 22, 2015

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