Effective management of air credit
With two of Australia's key carriers now allowing the transfer of credits between employees that work for the same company for select domestic airfares, companies have even more opportunity to save on air travel. For corporates looking to increase the value of their spend on air travel, the effective management of air credit has become a crucial strategy in travel procurement.
Without effective air credit management by your travel management company (TMC), your organisation risks losing money on expired tickets, which for some companies can amount to thousands of dollars every month.
What are air credits on hold?
Credits on hold are air tickets which have been previously cancelled or not been used. Airlines hold the value of these tickets and refer to them as 'credits on hold'. Travellers or travel bookers can request that the value of the credit be used towards payment for a new ticket of equal or higher value. Credits are available for use for a limited time and usually have a 12 month expiration date. If the stored credit is not used by the expiry date a company forfeits the value of that ticket.
Why is effective management of air credit so important?
It is very easy for corporates to rack up thousands of dollars in unused tickets every month. Organisations that were affected by the ongoing flight disruptions at Qantas due to union strikes, is one example of where organisations may have experienced higher than normal ticket cancellations. Without a dedicated focus on air credit management, a mid-to-large market organisation can easily write off $10,000 each month in unused air credit.
FCm's stringent client implementation process has unearthed situations where companies have come on board with substantial air credits on hold – some of these companies have been unaware of the actual value of their credit. Failure to manage these credits effectively, timely and proactively can result in serious financial loss.
Minimising airline credit wastage
At FCm we believe it is the TMC's responsibility to provide holistic management of air credits through reporting and proactive account management. Therefore, it is essential that TMCs have the technology, skills and process efficiencies to ensure complete visibility of airline credits at all times to reduce wastage.
FCm's success with client air travel programs has proven that organisations have a far greater chance of maximising the value of their air spend when there is a dedicated focus on air credit management from implementation. As part of FCm's client implementation process, we'll investigate how much air credit your organisation has and we'll immediately deploy strategies to ensure effective management of those credits.
To reduce airline credit leakage, FCm's online booking tool e3 provides advanced functionality that ensures credits are not only proactively alerted to bookers and travellers, but also made easy to redeem. FCm adopts a number of strategies to ensure unused tickets are used prior to expiry.
These strategies include:
- The automatic scheduling and emailing of recurring credit reports to all key company stakeholders via FCm's Crystal online reporting tool. These reports can advise status levels as frequently as required eg daily, fortnightly or monthly
- Accessing companywide credit status, which is available 24/7 via FCm e3.
- Pop-up notifications – when a traveller is selected, a notification box alerts the booker to an available stored credit
- Ability for the travel booker to view details including; expiry date, residual value, booking IDs of each available credit per traveller 24/7
- The ability to utilise credits via FCm e3.
- The ability for your dedicated FCm travel manager to routinely monitor upcoming credit expiries and ensure alerts are routinely issued from agreed time frames, eg fortnightly alerts for those credits containing three months validity or as agreed
- The reporting and recording of credit status and proactive redemption activity via quarterly account management reviews
- Ensuring that unused tickets are offered 100 per cent of the time through both online and offline channels.
- As e3 is a proprietary-owned tool, FCm is able to further enhance and develop the tool to suit changing market demands for air credit management.
FCm's holistic approach to air credit management, which involves a robust online system supported by proactive account management and comprehensive reporting, ensures companies are maximising every opportunity to save. When effective air credit management is combined with cost reduction strategies such as advance purchase and best fare of day, corporates are in an excellent position to maximise value from their spend and achieve long term savings.