Media Release
17 MARCH 2009
Corporates beware the true cost of ‘low-cost’ online bookings: FCm
Corporates being lured by travel websites promising ‘lowest rates’ are in some cases paying a higher price in the long
term, according to global travel management consultancy, FCm Travel Solutions.
FCm has advised corporates to be aware of the ‘real’ cost of using online booking sites for air travel, hotels, car hire
and rail travel, that require pre-payment in full and provide no flexibility on tickets.
FCm’s general manager New Zealand, Jenny MacDonald, said in the current climate of belt-tightening, FCm had seen
evidence of small to mid-sized companies believing travel websites offered the most cost-effective solutions.
“This may be tenable for companies whose travel plans never change. But for most this is not a realistic approach and
some degree of flexibility is needed in their travel itineraries,” she said.
“We have seen companies forfeit hundreds or thousands of dollars in lost room nights or air fares when their travel
plans have changed, after booking and paying for tickets that could not be amended and were non-refundable.
“Every company is focused on value right now – even more than before. However, value in travel doesn’t come from buying
what appear to be the cheapest tickets online.
“The recent changes to New Zealand’s domestic airline offering will impact business travel as there are several factors
that can push up the total cost of these bookings.”
Ms MacDonald said that while costs associated with booking changes were the biggest factor to consider, lost employee
productivity was also a potentially significant expense.
“A business traveller or personal assistant can spend hours trawling the internet to find what they perceive to be the
best rates, when not all available fares are displayed on the internet and there are hourly price changes. That’s time
and productivity impacting the real cost of the ticket and the company’s bottom line,” she said.
“There is also the issue of pinpointing the location of your travellers in an emergency – which is part of any company’s
duty of care - and tracking what all your travellers are spending on their trips. Web bookings do not provide any of
these benefits, which can be critical to overall expenditure.
“TMCs can take as little as five minutes to complete a point-to-point booking, while a corporate employee could easily
spend an hour or more surfing the web to make the same booking. Furthermore, by tapping into our multiple fare sources
and negotiating with suppliers based on volume, we can book world-best fares that are most suited to your business
needs.
“Every booking is made under a policy designed to produce long-term savings, and we target every opportunity to
streamline a company’s travel activity, processes and suppliers. Cost control is achieved through extensive reporting
and benchmarking, which provides total transparency.”
Ms MacDonald said companies using TMCs also had the peace of mind of traveller security services and 24/7 emergency
assistance.
“Corporates need to ultimately weigh up whether they want short-term gains or long-term consolidation, which is value
that can only be driven by strategic travel management with a holistic approach to their travel and purchasing
activity,” she said.
ENDS