Budgeting and Planning for the Company Plane
Every charter customer, at some point, asks us for ideas to help them cost justify the charter investment they make to fly with us in what they call the “company plane.”
In this article, we will show you a logical approach to budgeting for the company plane, and how it makes economic sense to do so.
The Single Trip Analysis
Your CFO or controller will almost always be able to make the case that flying commercial costs less money than taking the company plane.
If you happen to have four or more passengers, it was a last minute trip, everyone would have paid full-fare coach, and an overnight stay would be needed, you can usually show a break even between that commercial trip and using the company plane for a same day round trip.
But how often do those circumstances happen? Yet, for many companies, that would be the only time they use the company plane.
Annual Usage Is Better
We suggest that the company plane should be used like any business tool, and you should expect a comparable return on the investment.
Instead of analyzing the isolated single trip, what makes better business and economic sense is to plan the annual business strategy using the company plane.
For example, suppose you are planning next year to hire a new sales manager or any executive who supervises multiple teams across a geographic area. Let’s assume the annual salary, bonus, and benefits for this new hire would be $100,000.
Now compare the cost and expected return from a new hire to using the company plane twice a month to leverage your existing management team so that you don’t need to hire a new manager.
Instead of losing the time it takes to teach a new manager your products, methods, delivery, and support standards, your existing management team would be productive from day one.
Overnight Trips Waste Your Time
Most of your business travel is probably on commercial flights. Even with airport club memberships and first class upgrades, the reality is that commercial business travel wastes an enormous amount of executive time.
You probably take quite a few overnight trips, either to get to your destination city the night before because you have an early morning meeting; or you stay overnight because business ends too late in the day to catch a reasonable flight back home that evening.
Hours could be lost because you left work early the afternoon before the meeting to fly to the destination city. Or you lost an entire morning flying back the day after your business concluded. And you already know how much time is lost getting to the airport an hour before each departure.
We think your experience would show that the average overnight trip results in a minimum of four wasted business hours.
An Extra Four Weeks!
Through strategic use of the company plane, we believe that you can easily gain an additional four weeks each year of productive time, simply by eliminating some of your overnight trips.
If you and your executive team eliminated just 40 of your overnight trips each year, by using the company plane for same day round trips, you would save 160 business hours, or four weeks of productive time. Think about all the ways your company would benefit from you having that extra time!
Back to the CFO
What your CFO may not know is that companies that plan for the annual usage of the company plane are often able to negotiate rates that reflect the higher usage. And that makes the company plane an even more sensible business tool!
To plan a sales blitz, call Randy Duncan at (864) 370-2962 or firstname.lastname@example.org