It’s official. Air, hotel, car and meeting costs are on the rise. How can SMEs best benefit from the heated market? By EMILY ROSS.
By Emily Ross
It’s official. Air, hotel, car and meeting costs are on the rise. How can SMEs best benefit from the heated market? We track down ways to find the best possible rate for your next business trip (psst… and how your business can benefit from the airline wars).
Last Thursday, American Express Business Travel released the Global Business Travel Forecast that should have business travellers rethinking their 2008 budgets.
Business travellers can expect domestic trips (including airfare, car and hotel) to increase by 8% (despite the cheap air tickets), adding an estimated $99 to a total average cost of $1293 per trip; international trips are forecast to rise 5%, or $197, to bring the average cost to $3990.
It’s time to get vigilant about finding the best possible rates for your next business trip.
The battle of the low-cost carriers is heating up as Singapore Airlines offshoot Tiger Airways starts flights from 23 November 2007 to 11 Australian destinations from its base at no-frills Terminal 4 of Melbourne Airport. (Sorry folks you have to walk across the tarmac to your aeroplane; rain, hail or shine.)
Travellers wanting those Tiger Airways fares cannot use any other flight booking sites such as Flight Centre or Webjet as Tiger Airways is not interested in getting involved with online third-party operators. “It would be a bit like Coles letting Woolworths have a section of their store,” says Tiger Airways Australian head of corporate affairs, Matthew Hobbs.
Jetstar is going to “compete vigorously”, says Jetstar’s general manager of corporate relations Simon Westaway, adding that the airline will increase seat capacity by 40% in the next 18 months. He also tips another wave of airfare deals before Tiger Airways’ Australian launch on 23 November.
Virgin Blue will keep up the deep discounting, continuing to offer its $1 fares, two-for-one deals and daily happy hour specials.
Shock horror, these e-newsletters are far from spam. They give your business the heads-up on airfare sales and bargains such as Jetstar’s “Take a Friend for $3”. Frequency varies from weekly to fortnightly so the e-newsletters won’t jam your in-box. If you’re not on these subscriber lists, chances are the best tickets will be sold out by the time you hear about them. (Webjet, Virgin Blue and Jetstar have 800,000 on their lists already.)
If you don’t want the e-newsletters yourself, have your travel booker subscribe. Best e-newsletter bets: Tiger Airways, Virgin Blue, Webjet and Jetstar.
It’s hard to beat English-based search engine Skyscanner.net. It quickly shows daily best flight prices over a week or month or even a year in chart form. Once the cheapest flight is found, bookings are then made directly with the airline.
Alternatively, Webjet chief executive Richard Noon’s favourite web tool is the Webjet Deal Finder. For an executive wanting to fly to London in the next eight weeks, it can compare all the flights on all the departure dates for the whole period on one screen. “If you are flexible on the days you want to go, you can save $500,” says Noon.
Prices are colour coded, so it is easy to identify the highest and lowest prices. Users can even look at the Deal Finder results in a grid or chart form. (I love the chart form, which displays the cheapest flight for each day of the travel period, making it easy to see why smart travellers try and fly on Tuesdays to save a fortune.)
There might be some $19 flights from Melbourne to Perth, or a cheap ticket to the Gold Coast, however classic corporate routes at peak times are not going to be affected by the low cost carrier wars.
The following table is a reminder of airfare cost rises to come. You have been warned, especially the growing number of Australian business travellers who have a tantrum if they are not booked on Qantas!
|
Global – 2008 forecast increases (from American Express Business Travel) |
||||
|
Region |
Published airfares |
Published hotel rates |
||
|
Domestic / |
International / |
Mid-range |
Upper-range |
|
|
North America |
1% to 5% |
5% to 10% |
4% to 7% |
5% to 8% |
|
Europe |
2% to 5% |
6% to 10% |
12% to 14% |
12% to 14% |
|
Asia-Pacific |
1% to 3% |
3% to 6% |
18% to 22% |
18% to 22% |
|
Global |
1% to 4% |
5% to 8% |
11% to 14% |
11% to 14% |
With expected hotel rate rises of more than 10%, someone in your office needs to become an online hotel booking genius or else hammer out a deal with preferred suppliers.
Work out the price you can afford and stick to it (making sure it includes breakfast). Make sure the hotel is close to where you will be working and start enforcing the travel policy.
There’s no point in making an issue of spending after the company’s money is spent. Make friends with Wotif, Ratestogo.com.au, Lastminute.com.au and AsiaTravel.com for excellent last-minute hotel rates, up to 75% off. Try a Wotif Wot Hotel secret hotel.
You choose the location, agree to the price and find out the hotel name once you’ve paid. Five-star hotels for around $170 in the CBD for example.
Sounds petty, but make sure you read the fine print on those too-good-to-be true airfares and hotel deals. Ensure that all taxes and charges are included.
Those Neil Perry shiitake wontons in Qantas Business Class are all very nice, but surely a business that can afford (and justify the cost of) business class travel should be looking for any way to cut costs.
Webjet has an e-newsletter specifically for business and first-class passengers that has several thousand subscribers. RSS feeds are also available. First Class and Fare Saver also have a regular stream of discounted business class fares and functional search engines. This could save your business thousands.
Virgin Blue is entering the business class arena in April 2008 with three rows of premium economy in its fleet. The pitch includes red Recaro leather seats, 2 x 2 configuration, Foxtel screen, complimentary lounge access and a 32-kilogram luggage allowance.
A cheap hotel on the wrong side of town with $40 daily broadband fees, a red eye flight that takes three times as long to get there, or an inflexible flight that might need to be changed at the last minute are not bargains. These deals kill productivity, waste time and make staff feel like absolute crap!
Emily Ross is the former travel editor of BRW magazine. She is the author of 50 Great e-Businesses and the Minds Behind Them, Random House, September 2007.
Smart Company is a sister publication to The Mandarin, catering to Australia’s entrepreneurs, small and medium business owners and business managers.
