Justifying Corporate Jet Charter in a Down Economy
Posted: Monday, August 03, 2009
by Jeff Hardesty
JDH Group, Inc.
In this Business economy, there's only 2 ways to help the 'Bottom line'... (1) Cut costs and (2) Boost productivity.
And... there are only (2) ways to have your employees travel corporately... by air or by car.
I don't have to tell you that the reason most companies don't use Jet Charter service is the COST. Trying to 'Justify' that 'Luxury Price Tag' to the people at the top is like trying to sell electric cars in Saudi Arabia .
But here's the business 'Reality'. If you ask any CFO what a 200K executive should contribute to the company, it's going be more that 200K. That's called a 'Productivity factor'... and everyone from the bottom of the org chart to the top has one. And the more you make, the higher your factor is.
Companies are literally losing thousands of dollars per year by not analyzing the 'Comprehensive costs' associated with BOTH corporate Travel expense, Executive Productivity and Destination Logistics.
Regional Business Travel by Car
84% of U.S. business trips are regional and 80% of those are by car 200 - 400 miles driven one-way.
Are any of your mid-level or high-level executives jumping in a car to get from 'Point A to Point B?'
Then I don't have to tell you that spending 7-14 hours 'On the Road' just for 1 business meeting is not a good use of an executive's time... especially if they are salaried in the 6-figures.
Here's a real example. Chartering a King Air Jet prop airplane for 3 executives traveling by car to 2 business destinations @ 200 miles per travel leg would save over 12 hours of cumulative Executive time.
That's a Time machine Savings with Employee Productivity Value of over $12,000... $12,736 to be exact.
And that's not counting getting back the same day if they wanted to.
The Corporate Travel ROI Simulator can analyze all corporate travel by car utilizing your own internal 'Business rules'... allowing you to quickly determine the most appropriate vehicle of travel for that particular business mission because of who is traveling and why.
Traditional Airline Travel
We all understand the inconvenience with traditional airline travel.
And we all remember when the CEO's of the Big 3 auto makers individually flew into Washington in their big corporate Jets to 'ask for more money'.
Without doubt they 'Didn't have a clue' from a Public relations standpoint.
But 'Politics aside', here's the interesting part from an overall business equation.
Let's take that same Detroit to Washington trip and compare traditional Airline travel to charter Jet travel in a mid-size Jet.
The Corporate Travel ROI Simulator compared 1st class airline travel for the GM CEO making 2.2 million in salary and having to make 1 intermediate stop on an 519 mile airline trip.
And the 'Productivity Factor' business rule is set to a multiple of (5.7), which is a conservative factor based on a mid-level executive.
In this travel scenario, the Corporate Travel ROI Simulator shows that there is a Time machine Savings with Employee Productivity Value of over $63,000... $63,426 to be exact.
Just like a baseball club with a superstar making $150,000 per game... they don't want that guy 'Sitting on the bench'. They want him out on the Field or in the 'Batting box'.
Because when you recover 9 hours of a CEO's productivity time... it's something you can actually 'put your Finger on' and ultimately justify it. And that goes for other executives that are higher up on the org chart, minimally in the 6-figure salary range.
And what about the PR move to appease the public outcry by succumbing to a 9-hour hybrid car ride on his next trip to Washington ?
In this travel scenario, the Corporate Travel ROI Simulator shows there is a Time machine Savings with Employee Productivity Value of over $133,000... $133,235 to be exact.
Because you recover 12 hours of an executive's productivity time... and Time truly is Money.
A 'Business Tool' for your Corporate Travel Decision Making Process
The NO COST Corporate Travel ROI Simulator allows corporate travel decision makers to sit down and use a Quantitative approach to corporate business travel total expenses using a blend of cost factors, travel logistics and employee Productivity factors.
Simply, it signals you when custom Jet Charter makes more 'Bottom line' business sense than tradition airline or auto travel... and most importantly... trips can be individually documented and legitimately 'Justified at the TOP'.
Jeff Hardesty is President of JDH Group, Inc. and developer of the Corporate Travel ROI Simulator. He provides companies with a NO COST Corporate Travel Simulator, a 'Business tool' that compares Travel Cost, Executive Productivity and Destination Logistics and points to 'alternative travel vehicles' when destination Logistics and executive Time compensate well over a 'Line item' travel cost.
To receive a complimentary DEMO of the Corporate Travel ROI Simulator with your own corporate travel scenarios contact Jeff @ 740-881-1691 or email jeff@convertmoresales.com with 'Jet Charter DEMO' in the subject line.
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