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How to tackle ancillary spend

CWT estimates that ancillary spend can account for 5-10% of the corporate air budget 1 and can add up to 33% to the cost of a hotel stay 2.

 

This proves it’s important to look beyond the cost of fares and rates in order to effectively manage the total cost of travel.

 

How to tackle ancillary spend

 

Consider these three main areas when looking to better manage ancillary spend:

 

1.  Negotiate ancillary fees with suppliers. Ask suppliers to provide information on ancillary fees so you can more accurately compare competing offers. This can lead to better discounts or even waived fees and improved conditions for travellers. For example, some CWT clients with large spend volumes have successfully negotiated frequent flyer perks (eg lounge access and priority boarding) for all their travellers.
 
2.  Track ancillary spend. Until more ancillary fees are booked through global distribution systems (the tools travel agents use to make bookings), expense reports and credit card figures will remain the best sources of data on ancillary spend. CWT can provide tracking, spend estimates and data analysis to enable you to monitor programme performance on both the traveller and airline sides.

 

3.  Clarify your policy on ancillary fees. Include a special section in your travel policy that lets travellers know which fees are allowed to be claimed back (eg frequent travellers can claim for airport lounge access). These policy items should be supported by regular communications to travellers.

 

Quick facts: 44% of all surveyed travel managers intend to negotiate hotel amenities to optimise spend, while 34% of global travel managers plan to negotiate fuel surcharges and other ancillary fees to drive savings in air and ground transportation this year 3.

 

1 CWT Travel Management Institute, Mastering the Maze: A Practical Guide to Air and Ground Savings (2012)
2 CWT Travel Management Institute, Room for Savings: Optimizing Hotel Spend (2009)
3 CWT Travel Management Priorities for 2013 (2013)

 

Download CWT’s Travel Management Priorities for 2013 to read this article in full and gain access to many other articles designed to support and improve your programme.