EDITION 1, MARCH 2010

Industry News
BRITISH AIRWAYS REDUCES CAPACITY WASHINGTON IS ALL BUSINESS British Airways has announced that Washington DC will be the second US city to be serviced by its all-Business Class offshoot OpenSkies. The carrier is introducing ve ights per week between Paris Orly and Washington DC as of 3 May. Services on this route will be increased during the year.

Shannon OBrien
FCm Global Executive General Manager

Welcome to the rst edition of Perspectives

This month were pleased to launch the rst edition of FCms Perspectives.
Produced in an easy to read, four-page design, Perspectives will focus on procurement issues and trends, account and expense management, compliance reporting and any other aspect of corporate travel that directly affects your bottom line. As part of our commitment to keeping you informed, Perspectives will include a range of articles covering industry news, whitepapers, client case studies and some months, client or staff proles. In this edition however, our whitepaper focuses on the importance of advance airfare bookings. Based on a study conducted by one of FCms senior account managers, our whitepaper highlights how much you can save on airfares by planning ahead. Our client case study shows how FCm is helping a software solutions company save almost $250,000 on its travel spend this year. We hope 2010 is off to a ying start for you and until the next edition happy travelling.

British Airways is temporarily scaling back its services between Britain and Australia. This month the carrier is dropping its daily ight between Sydney and London via Singapore leaving one daily 747 ight via Bangkok. The airline will do the same for 18 days in May and also cut services in April and June.
IHG UNVEILS NEW PROPERTY

InterContinental Hotels and Resorts is expecting to open its new 36-storey hotel in Times Square New York in July. The new-build hotel is located on 44th Street and has 607 guest rooms each averaging 350 square feet. Called InterContinental New York Times Square, the property features a French bistro inspired restaurant from celebrity chef Todd English and a 24-hour business and tness centre.
QANTAS EXPANDS SERVICE

capacity on ights from Perth to Karratha, Paraburdoo and Port Hedland. Meanwhile, Qantaslink has commenced a new service between Adelaide and Port Lincoln. Nine return services per week will be offered on this route.
AIRPORT SECURITY UPGRADED

presence at airports, boosting security cooperation in the Asia Pacic region, upgrading intelligence sharing between customs and law enforcement and additional screening at most regional airports.
SCHEDULE CHANGES

The government plans to spend $200 million over the next four years to beef up security at Australian airports. Funds will be spent on increasing the number of rearm and ammunition detection dogs at airports, maintaining Australian Federal Police

As of 28 March, Delta Airlines service between Sydney and Los Angeles will operate on a Monday instead of Tuesday. Deltas remaining six weekly ights will continue to depart Sydney at 9.15am except for between 28 March and 4 April, when they will leave an hour later due to daylight savings.

Qantas has started a thrice weekly return service between Canberra and Darwin, which is aimed at the government and business sectors. The carrier also is increasing
NEWS FEATURE

Electronic newspapers
Business travellers may soon be able to read their favourite newspaper or work p p

documents on a new electronic reading device that retains the look and formatting of a printed newspaper. Plastic Logic announced it will launch a lightweight electro electronic rea reader in the US next mon nth. month. Called Qu Pr ue Que ProReader the de evice device allows new o ws news organisations to d distribute the their

publications wirelessly to subscribers. The device retains more formatting of a printed newspaper product including tables of information, headline presentation and advertising. Its reported The Wall Street Journal, the Financial Times, The Los Angeles Times and a number of business magazines have partnered with Plastic Logic for circulation.

All material in Perspectives is copyright and may not be reproduced in whole or part without t the express permission of the publishers. Australian OpCo Pty Ltd (ABN 20 003 279 534) trading g as FCm Travel Solutions. Licence numbers, NSW 2TA002547; VIC 32360; ACT 18800566; ; QLD 3124259; SA TTA192799; WA 9TA 1362; TAS TAS160; NT LTA 149. FCm Travel Solutions is part of the Flight Centre Limited corporate division:

FCm Perspectives

The power of advance purchase airfares

For businesses that are keen to keep a tight reign on their air travel spend, one of the proven strategies to boost savings is implementing an advance airfare purchase policy in your travel program.
Whether your company uses a preferred carrier or has opted for an open sky policy, there are signicant savings on airfares to be made by being prepared, planning ahead and booking early. wont be suitable for all business travellers, particularly those who frequently make changes to their schedules. FCm recommends working with your travel manager to implement a fare purchasing strategy that not only suits your business travel needs and patterns but sits within your travel policy and budget parameters. Using a departure date of 2 February, the study tracked advertised fares for ights between 6am and 8am by three major Australian airlines. The results show clearly that bookings made two to ve days in advance and one day prior to the departure date were on average signicantly higher for all three airlines. According to the study: > Passengers travelling on airline A would have paid on average 72 per cent more > Passengers travelling on airline B would have paid on average 28 per cent more > Passengers travelling on airline C would have paid on average 13 per cent more. Its important to note that savings on domestic tickets across carriers will uctuate throughout the year according to daily prices, however the snapshot of fares used in this study is a good indication of how businesses can boost savings through forward planning. In addition, variations in ticket prices also reect the differences in product and service offered by each airline.

Fare classes how they work

Over the years, airlines have developed complex strategies for managing yield and, as part of this, seats throughout the aircraft are grouped in ticket booking classes. Generally airlines will sell only a small amount of headline fares for the cheapest seats in Economy Class. The remainder of Economy Class seats are staggered in price with fully exible Economy Class tickets costing more. Generally, last-minute tickets are more expensive, as the cheaper seats, which are fewer in volume sell out rst. The availability of different booking classes on airlines around the world is dictated by a range of factors including season, demographic, fare restrictions, market (domestic or international) and inter-airline agreements. While a fully-exible ticket may cost more, they are refundable and can be changed at any time. When booking in advance travellers need to be mindful that a cheaper, restricted ticket will have more conditions attached to it, therefore travellers need to know their plans arent going to change to ensure no additional fees are incurred through booking changes. Restricted fares

Price impact of advance airfare purchasing

An FCm study indicates that companies can save on average up to 72 per cent on the cost of their tickets by booking 21 days or more in advance of their departure date. The study, which was conducted in January and February 2010 using fares for 12 major domestic routes, compared ticket prices for bookings made one day in advance, two to ve days, six to 10 days, 11 to 20 days and more than 21 days in advance.

Companies that implement a strong advance purchase behaviour strategy within their organisation can achieve maximum savings on airfares.

Reducing your ATP

Your FCm travel manager can show you how to reduce your ATP (average ticket price) through advance airfare purchasing on airfares that are best suited to your travel needs. If you have implemented an open sky

policy in your travel program and therefore use Best Fare of the Day, there are still savings to be made, particularly if booking during peak periods. FCms study shows that average ticket prices during times of low capacity will almost always rise ve days prior to the departure date, with the lowest fare for the route generally advertised 21 days or more out from departure. During peak travel periods, fares start to rise much sooner, making advance bookings a particularly important cost cutting strategy. During peak and high capacity periods, such as Christmas, last minute fares can more than double.

that may include cheaper, restrictive fares that can be booked in advance. By booking in advance companies with market share agreements can effectively increase their volume of travel, but continue to meet their contracted targets. This means that companies can invest in more face-toface meetings, increase the frequency of their travel, have more people travelling or y in a higher cabin class.

what non-compliance measures will be taken if people do not adhere to your policy. Booking in advance isnt always going to work in the case of emergencies and unforeseen events, but when travellers know an event is happening a few months or weeks ahead, best practise demonstrates its wise to book as early as possible.

Change management
There needs to be a common mindset in your company when it comes to advance bookings and educating your employees is a crucial part of this. Your FCm travel manager can help you proactively inform your travellers and travel bookers on your policy and how it affects them, what your companys goals are, the benets of your travel policy and the savings that are achieved as a result of compliant travel behaviour.

Mandate advance bookings

You can enhance the way you and your people travel by including an advance booking policy in your travel program. Communicate your policy clearly and effectively to all your travellers and make sure they know what is expected of them. The impact of the GFC has seen a number of companies mandate two week advance booking policies into their travel programs. You will also need to consider

Fly with your preferred carrier and save

Your FCm account manager can identify opportunities to save by negotiating an airline agreement with your preferred carrier
ADVANCE PURCHASE IMPACT

The FCm difference

$300
AIRLINE A

$250
AIRLINE

$200
AVERAGE AIRFARE

AIRLINE

The personal touch > Expert advice from a dedicated, personal travel manager. > Service tailored around your preferences, policies and budgets. > Experienced, knowledgeable help only a phone call away. Saving you money > The best prices on airfares, hotels and car hire. > Corporate hotel programs and our Best Rate/Fare of the Day. > Partner promotions that take your travel budget further. Saving you time > Round-the-clock service that ensures you are never kept waiting. > Agreed, guaranteed turnaround times on all point-to-point itineraries. > No need to spend time on your own online comparison searches. Lightening the load > Alterations to complex itineraries made to look simple. > Smart tools that offer a choice of options and hold multiple tickets. > Traveller tracking technology that can pinpoint your people. Easier admin > Streamlined expense management and consolidated reporting. > Tailored account, technology and pricing preferences. > Access to FCm Online our best-practice booking tool.

$150

$100

$50

$0 21+ days 11 20 days 6 10 days 2 5 days 0 1 day

ADVANCE PURCHASE
Based on ight departures 6am 8am on 2 February 2010.

REDUCE YOUR ATP WITH GOOD ADVANCE PURCHASE BEHAVIOUR

QUARTER

QUARTER

QUARTER

QUARTER

Advance purchase <5 days prior to date travel Saver fare use Flexi and full economy use Average sector price

35% 83% 17% $188

43% 81% 19% $194

40% 80% 20% $203

49% 80% 20% $211

The table above shows the price impact on ATP when more full economy fares and less discounted fares are used.

1300 557 975 www.fcmtravel.com.au

Case Study

We have found FCm to be proactive in helping us identify potential savings. FCm was instrumental in ensuring we achieved the best pricing as a result of our preferred supplier arrangements. Through its online booking tool we have greater visibility of our travel spend, which helps us achieve further travel savings. Caroline Pearson, TechnologyOne Accounts Payable Supervisor Finance

TechnologyOne
FCm Travel Solutions has provided travel management services to TechnologyOne for more than a decade. FCm retained TechnologyOne as a client after a successful tender process in 2009 and since then has continued to generate signicant savings by helping the company re-launch its travel program.
The partnership has developed in line with TechnologyOnes strong organic growth, with FCm providing the technology, service solutions and negotiating strength to ensure tangible savings across all aspects of the companys travel program. General Manager at FCm, James Kavanagh said the company started a review of TechnologyOnes supplier contracts for its air travel in April 2009. After weeks of negotiations, TechnologyOne signed a supplier contract with one domestic and one international carrier. FCm also negotiated a new hotel program for 2010 using a number of key preferred hotel suppliers across Australia and New Zealand. In addition to driving down the nightly room rates, FCm helped to negotiate ancillary services including breakfast, internet and car parking, as part of the total cost of TechnologyOnes hotel spend. Regional presence: Because a signicant portion of TechnologyOnes New Zealand air travel is domestic, the companys travel program was initially launched in New Zealand. By doing this, most of TechnologyOnes domestic travel in New Zealand is managed by local FCm teams, which helps to reduce costs and provides travellers with a local and centralised point of contact. Technology solutions: TechnologyOne requires technology solutions that provide enhanced visibility, reporting and data analysis across its travel program. This ensures the company has clear insight into its travel patterns and knows where and how it is spending its travel dollars. As such, TechnologyOne uses FCms online booking tool, which has helped to streamline the booking process and provide greater visibility of policy compliant airfares and company preferred contracted hotels and rates. The company achieved a 90 per cent adoption rate immediately after implementation. FCm holds regular review meetings with TechnologyOne to assess the success of the program and identify areas where further savings can be achieved.

Who is TechnologyOne?
TechnologyOne is a leading enterprise software solutions provider with ofces in each state and territory of Australia, as well as New Zealand, Malaysia and the United Kingdom. TechnologyOne provides comprehensive and deeply integrated enterprise software solutions that are used by business, government, health and community services, education, nancial services and the utilities sectors. TechnologyOne develops, markets, sells, implements and supports its suite of software solutions.

What were the results?

The annualised contract savings across TechnologyOnes refreshed 2010 travel program are estimated to be in excess of $250,000. This is a direct result of locking in better negotiated supplier rates. When broken down these gures represent a saving of almost $150,000 per annum on the companys air travel and around $100,000 per annum on its hotel spend, when compared to the 2008-2009 scal year. By using FCms online booking tool TechnologyOne also improved the efciency of end-to-end booking transactions, saving considerable time in the process.

What solutions has FCm put in place?

Travel program re-launched: As a rapidly growing company, TechnologyOne requires a robust travel program that leverages the companys increasing room night volumes and levels of air travel to optimise savings. FCm helped TechnologyOne re-launch its travel program for 2010 using its strong negotiating muscle to secure competitive corporate deals with the companys preferred airlines and hotels.

What the future holds

FCm is currently looking at TechnologyOnes car hire bookings and agreements to identify further saving opportunities. FCm is also in the process of rolling out the Corporate Quickbeds program, featuring distressed inventory accommodation at the lowest rates, further driving down the cost of accommodation for TechnologyOne.