Establishing effective travel policies is crucial for managing corporate travel expenses and ensuring a smooth experience for your employees. At AllFly, we’ve streamlined the process, allowing companies to set policies based on flight durations.
This guide will walk you through the key considerations and best practices for setting up your company’s travel policies.
Configuring Travel Policies by Flight Duration
AllFly’s platform allows you to set travel policies based on the duration of flights. This flexibility ensures that your employees travel comfortably while adhering to budget constraints. Here is a general recommendation on where to start when thing about travel policies:
0-4 hours: $500 cap, economy
4-6 hours: $800 cap, economy
6-12 hours: $1,350 cap, economy & premium
12+ hours: $1,750 cap, economy & premium
By tailoring your policies to the length of flights, you ensure cost-effectiveness while maintaining traveler comfort. We strongly recommend against allowing your employees to select basic economy fares.
In the future, we are exploring making our fares brackets easier to navigate, going from 4 brackets to three (0-4 hours, 4-8 hours, and 8+ hours).
Everyday Business Travel vs. Event-Based Travel Policies
Quest allows you to create travel policies that apply to everyday business travel as well as policies that are specific to events. This distinction is important because events often have unique requirements, such as larger group sizes or special accommodations.
Everyday Business Travel Policies: These are the standard policies that apply to regular business trips, ensuring consistency and cost control across all routine travel.
Event-Based Travel Policies: Since events are more specialized, you can create policies that are tailored to the specific needs of each event. This might include different budget allocations, class of service preferences, or specific routing requirements.
Important Note: The event-level travel policy will supersede the general everyday business travel policy. This ensures that the specific needs of your event are prioritized over the standard travel guidelines.
Using AllFly’s Forecast Tool for Budgeting
Accurately budgeting for travel is essential, and AllFly’s Forecast tool can be a valuable resource in this process. The Forecast tool provides insights into median fares, which can serve as a reliable benchmark for setting your travel budget.
The median fare gives you a realistic expectation of what you should be paying for flights, avoiding the extremes of overly expensive or unusually cheap fares.
Why you should avoid using Google Flights for analysis
While Google Flights is a popular tool for checking flight prices, it’s not ideal for corporate travel analysis. Here’s why:
Basic Economy Pricing: Google Flights often displays Basic Economy prices on its listing cards. Most corporate travel programs prefer to avoid Basic Economy due to its restrictive conditions, such as limited baggage allowances and non-refundable tickets. The difference between Basic Economy and standard Economy can range from $50 to $100.
Impact on Budgeting: Relying on Google Flights could lead to under-budgeting, as the prices shown may not reflect the true cost of travel for your employees.
For a more accurate analysis, use AllFly’s Forecast tool to ensure your budget aligns with actual corporate travel needs.
Budgeting for large groups
When managing travel for groups over 150 people, special considerations need to be made. Airlines typically sell the cheapest seats first, so if you have a large group, the initial prices you see online may not be representative of the final costs.
If a significant number of employees are traveling from the same city, we recommend calculating your budget using the 5-7th cheapest fare available and adding 50%. This approach accounts for the likely increase in fare as cheaper seats sell out.
For example, if 50 employees are flying from JFK to Palm Springs and the initial fare is $450, you might be able to secure the first 10-20 tickets at that price. However, the remaining tickets will likely cost more. In this scenario, budgeting at $675 per ticket would be a more realistic estimate.
By following this method, you can avoid unexpected expenses and ensure that your travel budget covers all necessary costs.
We also recommend that if you group is between 200-300+, you strongly consider hosting your event near a major international airport.
Communicating your company's travel policy to employees
Communicating your company’s travel policies before employees book travel is crucial to ensure that everyone understands the rules and expectations, particularly regarding cancellations.
When an employee cancels a non-refundable ticket, the value of that ticket often becomes an eCredit tied to the traveler’s profile, which is standard practice among many airlines in North America.
It’s important to clearly instruct employees that these eCredits should not be used for personal travel but must be retained for future business purposes. By setting and communicating these guidelines upfront, you help safeguard company resources, maintain compliance, and ensure that any potential travel credits are appropriately managed and utilized for future business needs.
Conclusion
Setting up your company’s travel policies with AllFly allows you to manage travel expenses effectively while providing a comfortable experience for your employees.
By configuring policies based on flight durations, using tools like AllFly’s Forecast, and budgeting appropriately for large groups, you can optimize your travel program for both cost and convenience.