I have read with great interest lately people writing about the demise of the lowest logical airfare for business travel. I have read and thought about this subject for many weeks, thinking about whom writes this, and the reality of it. Could it be true? Is the end of the low airfare near?
I do not think so. And let me share with you why.
The basic premise of running a business is to create profits. Profits are created for the shareholders or owners (I know they are really the same) by increasing revenues and decreasing expenses. Leaders and owners of these companies have been known to be the most frugal humans on the planet. By example, Warren Buffett drove a used car for years until just a few years ago when he purchased his first new car, a Cadillac (paid in cash, of course).
The premise that employees would be allowed to travel on more expensive airfares to accommodate things such as airline preference, shorter flight times, non-stops over connections, class of service, to name a few, just does not sit well with me. Every corporation I have worked with has a policy based on a set of standards and preferences that balances cost with employee preference. To let everyone do what they want has proven to increase costs and reduce profits, a violation of business 101.
In addition, I believe every business travel policy is evolutionary. It changes, it grows, it gets smaller - it adapts to the environment of the company and the outside business environment. When the largest expense item after personnel and cost of goods sold is left un-managed or left to the decision of employees, you are faced with increased costs and decreased profits. But a travel policy and the adaptation of lowest logical airfare ensures that when employees do travel on business they are doing it at the lowest possible cost to the company.
So who writes all this stuff about the demise of the lowest logical airfare? I'm not sure - new players in the industry, or maybe business leaders who are trying to sell their product based on a new set of parameters. In the end, what I write or what anyone writes really has nothing to do with what will happen - because, like always, the one writing history will be the customers - and the ones that pay for business travel are the leaders of the companies that pay for the tickets.
I expect that in the end the ideal of lowest logical airfare will remain the standard for business travel. It will get more complicated with various channels and ancillary fees, but flying on business must be at the most cost effective manner possible for the businesses of the world.
