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Travel Managers: Tips to keep your travel expenses in line with your 2015 budget

travel managementAs businesses move toward the end of the first quarter, let’s take a look at some travel issues that could affect your bottom line should they go unchecked.

1. Frequent Flier Programs

Be aware of changes to frequent flyer programs as they can affect traveler habits which, in turn, could increase a company’s overall travel expenses. Miles flown has always been the driving force of these programs, but two major U.S. carriers (and my guess is that the third will soon follow suit) have replaced miles with ticket price for both status and rewards.

Come third and fourth quarters, companies could see increases in spending habits as travelers seek to ensure they retain their status for 2016 when these changes go into effect.

Delta and United Change Loyalty Programs: What Does That Mean for the Business Traveler

2. Hotel Fees

Hotels are adding more and more fees. One fee policy to watch for in particular is cancellation. Many properties are now requiring a full 24-hour cancellation rather than the 6:00 p.m. day of arrival cut off. Marriott is among those properties to have made a formal announcement, with others to follow. Not educating your business travelers to watch for these fees and policies, especially when booking online, may result in no-show bills.

Hotel Cancellation Policies Becoming More Stringent

3. Fuel Surcharges

With the current price of fuel dramatically decreased, some airlines are opting to reduce their fuel surcharges while others are not. These fees were initially instituted when the cost of fuel began climbing. Communicating–be it through websites, Twitter, Facebook, or other social media platforms–to our “favorite” U.S. carriers that they consider a surcharge reduction may be in order, particularly since many competitors are now making these reductions. Many international carriers have conceded to lower these fees. Perhaps having a public conversation (the positive and negative of social media, certainly) might persuade U.S. carriers to be more aware of their loyal customers.

Falling Cost of Fuel and Airline Surcharges: Business Travelers Take Note

At Christopherson Business Travel, our Account Management team works to keep our clients aware of these and many other present and pressing business travel management issues. Through our consultative approach, we analyze a client’s travel program and make recommendations of where to make changes to save money and stay on budget.

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Business Travel Travel Management

Business Travel Cost Savings: Part 2 – Vendor Negotiations

To review Part 1 where we discuss the value of having a business travel account management team and the potential savings that come as a result, click here.

Part two of my series on business travel cost savings touches on vendor negotiations.

There are several options when negotiating for your hotel, car, and air contracts. Depending on the depth of the negotiation, one or more of the following processes may be employed: RFP (Request for Proposal), RFQ (Request for Quotation), RFI (Request for Information), ITB (Invitation to Bid), and/or ITN (Invitation to Negotiate). For example, if you are simply seeking information, then use the RFI process. If you are wanting pricing only, then an RFQ would be appropriate, and so on.

Clients who partner with Christopherson Business Travel enjoy the benefit of having an account management team who will consult with their travel managers to determine the best avenues when negotiating on their behalf. During our consultation we use the following formula for negotiation success:

  1. Visualize
  2. Prepare
  3. Strategize
  4. Empathize
  5. Commit
  6. Follow-Up

Have you ever wondered how hotels look at the negotiating process? Here is a little insight.

Hotels are ultimately judged by shareholders on their return on capital, which translates into targets for Revenue per Available Room (RevPAR), the overall revenue divided by the total potential number of room-nights over the financial year. Hotels use a range of techniques and technologies to assist them in “yield management,” the process by which they try to optimize revenue and occupancy over different market segments, through seasonal fluctuations, while taking into account national, regional and local economic circumstances. Some hotels have very sophisticated systems and experience analysts; others do not. Some hotels always follow the advice of the yield managers; others have more discretion.
Christopherson Business Travel knows that travel vendor negotiations can, and should, differ considerably company to company depending on the type of organization, size, geographic scope, and the degree of influence on the vendor. Christopherson’s account managers consult with industry experts and employ sourcing methods to help our clients create and manage their entire travel supplier network. In addition to the traditional vendor categories like airlines, hotels and ground transportation, we also support sourcing efforts related to meeting services, online booking tools, and credit card programs.

To produce cost-consistency and reductions, Christopherson Business Travel consults with you and creates strategies to:

  • Achieve optimal savings, coverage, and service goals
  • Align supplier programs with overall organizational goals
  • Track economic and industry trends to help identify opportunities for improvement
  • Take advantage of best-practice tools and benchmark information

Typical components of a sourcing management engagement include:

  • Vendor Program Assessment & Savings Opportunity Analysis
  • RFP Process Management
  • Negotiation Support
  • Vendor Program Implementation

President John F. Kennedy said, in his 1961 inaugural address, “Let us never negotiate out of fear, but let us never fear to negotiate.”

Because of increasing costs and greater demands, Christopherson Business Travel’s Account Managers will meet with you to create the ultimate scenario to ensure that your company gains a profitable return on investment with regards to your travel program. For facts on actual ROI savings and additional information, contact us.