Booking last-minute adds up

Martin Millican booked his flight and accommodation in Ottawa for the upcoming SaaS North conference three months in advance. While that might seem like jumping the gun, the CEO of Toronto-based Envoke.com has learned that waiting to book usually means entailing extra costs.

“If I can book a flight with points, I will use them,” he says. “And to get the maximum points value, you usually have to book well in advance.” But even when using points isn’t an option, Millican finds early booking saves cash. “I book the firm fare,” he says. “If you wait too long, you often end up with only flexible fares. And they cost a lot more.”

Cheap accommodation can dry up over time as well. By booking ahead for the conference, Millican found a good selection of rooms on Airbnb. “Even with the so-called special conference rate, the conference hotel cost $210 a night,” he says. “I’m paying just $65 per night for my room.”

Millican is a bit of an anomaly, according to Kevin Craig of travel management software provider Concur Canada. His company’s latest research shows Canadian leisure travellers generally book four to seven days (24 per cent) and eight to 14 days (24 per cent) in advance. In contrast, 19 per cent of business travellers wait to book until the last three days before their trip.

Sometimes that’s because they can’t pin down meetings, and people’s schedules are unpredictable. Or an issue pops up that requires immediate attention. But it’s also safe to say that “because business travellers are usually not spending their own money, they worry less about the cost of a ticket and spend more freely than they might if it was from their own pocket,” Craig says.

And that’s costly. When Concur analyzed 2.3 million Canadian airfares from 2014 to second-quarter 2017, it found booking seven days or less in advance costs 18-percent more on average than if the trip had been booked more than two weeks early. Even a day makes a difference. “Business travellers can cut that difference in half by booking even eight or more days in advance,” notes Craig.

For those flying to the U.S., it’s even more crucial to book early. Concur’s data shows flights to American destinations cost on average 44-per-cent more when booked a week or less before a trip rather than at least 15 days before. For flights in Canada, booking less than a week ahead costs 18 per cent more. “Neither increase is ideal,” says Craig. “But if you are travelling to the U.S., the imperative to book sooner is greater.”

To keep costs in line, Craig suggests the following:

Establish a travel policy. Encourage booking early, but not too early. (Airlines begin tinkering with fares about three months in advance, so you’ll find few bargains prior to that.)

Plan ahead to avoid travel during high premium months: Concur’s analysis of flights found the highestpremium month was April (15 per cent) for booking less than seven days out versus eight days or more. July and December have lower-thanaverage premiums for lastminute booking, but tickets are more expensive generally as they’re peak travel times.

Opt for the little guys. When last-minute travel is inevitable, you might cut costs by travelling out of small and mid-size airports, often with lower landing fees — a saving that can be passed on to travellers. “Toronto travellers should look at the costs to fly out of Hamilton’s John C. Munro Airport rather than Pearson,” says Craig. “And Vancouver fliers might want to look at Abbotsford International instead of Vancouver.” The caveat: Make sure the savings are greater than the costs for gas or a car service to get to that airport.

Reward employees for staying within policy. This is a fairly new concept, says Craig. “We see corporations incentivizing travellers not to just stay within budget, but to save money.” Sometimes businesses allow travellers to pocket some of the savings, or earn rewards points they can use for cash, gift cards, extra time off or charitable donations. “It can help motivate employees to book in advance, take that early-morning flight or stay at a threestar hotel instead of a fourstar hotel,” says Craig.

Take extra fees into account. Airfares have been flat in recent years (the average airfare in Canada in the first half of 2017 was actually $18 less than in 2015), but extra fees for checked luggage, changing reservations and booking seats jumped nearly 69 per cent from 2011 to 2014. Knowing exactly where your additional costs come in helps you keep fares down, says Craig. If you frequently change reservations you’d typically save money by buying a flexible fare up front, keeping change costs to a minimum.