Follow our step-by-step guide to saving money with frequent flyer programmes which, contrary to popular belief, can easily be utilised by SMEs

COMPANIES may use frequent flyer programmes (FFPs) to accumulate miles from business trips then use them towards the payment of future business trips.

In this way, companies can save some ten per cent of their annual air travel costs, on top of any other savings, including those realised through corporate loyalty programmes offered to SMEs.

The internal processes and culture of SMEs often make this potential rather easy to exploit, says Ravindra Bhagwanani of Global Flight. Read on for his explanation.

STEP 1: Take a clear decision, backed by your management, whether you want to use frequent flyer programmes on a corporate level. The main argument you have for doing so is the potential cost savings, usually in the area of ten to 15 per cent of air travel costs. Get HR on board as well.

STEP 2: Set up the project and prepare it thoroughly in advance. You may require outside help. Ensure that your partners have experience in the FFP area and that their pricing fits to the overall picture. As general guideline, you should not pay more than one per cent of your annual air travel costs for the initial set-up and one per cent for ongoing operational tasks. These values are also the bench-mark to decide between in-house and external solutions.

STEP 3: Select the programmes. There are 180 highly different FFPs available and airlines participate in up to 25 programmes simultaneously. For instance, an Executive Club member requires ten round trips on British Airways in Business Class to New York before getting a free flight. The same British Airways flights credited to the Finnair programme would realise eight roundtrips. Another example is travelling on Kuwait Airways and using its Oasis Club: that gets you a free flight after just five flights. Differences also apply between programmes in terms of flexibility of using awards, such as minimum booking lead times. Work actively with the transfer-ability of awards between travellers – less frequent travellers tend to be more flexible to use award flights! Plan the strategic use of awards (which routes, which periods, which travellers?) as the basis to achieve maximum savings and consider the issue of separating personal and corporate miles. Don't tackle operational tasks before having resolved these strategic basic issues.

STEP 4: Set up the internal processes. They primarily consist of tracking the miles your travellers accrue over the programme websites and making award bookings directly with the programme operators. Coordinate these processes with your travel management company and consider frequent flyer pro-gramme administration software for maximum transparency, such as FFP Manager (see www.ffpmanager.com for details) in this context.

STEP 5: Implement the changes and inform your travellers. Anticipate a three-month interim period between project start and implementation.

STEP 6: Manage the project on an ongoing basis: control the execution, review your programme selection on an annual basis – or even more frequently – and monitor the savings you have made. In addition, prepare for appraisal from your boss.

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