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Article Excerpt
Squeezed by skyrocketing insurance costs, escalating fuel prices and a soft market that has led to intense price competition among suppliers, the car services industry is depending on surcharges as the way to stay viable. For corporate buyers, this can result in confusion and means the actual cost of a chauffeured sedan or limo usually is much higher than the published rate. Plus, the name of the fee and the way it is implemented--for example, whether it includes gratuity, which might be a separate item--varies from network to network. Buyers need to spell out clearly in their requests for proposals the type and amount of surcharges to ensure they are comparing apples to apples. They also should try to ensure that no subsequent increases or new charges will be implemented during the life of the contract.
Regarding fuel surcharges in particular, buyers should ask if it's just to cover fuel, if it's temporary and if the supplier is committed to reducing the cost once fuel prices decrease.
Another area where buyers are likely to discover significant variations among vendors is automated booking. You should ask whether suppliers offer real-time connections with the global distribution systems and other corporate booking tools. The options are richer now than ever. Unfortunately, some car services suppliers have been known to claim services--such as real-time online booking capability--and provide other information in an RFP on which they ultimately could not deliver. Make an onsite visit, advised Bob Lockett, Empire International vice president of sales and marketing.
Most importantly, double-check the company's driver safety program. The type of relationship it has with its affiliates also is essential information.
Supplier information and implementation of the program are other aspects buyers should not overlook when submitting an RFP. consult with the supplier before sending the RFP to see if it can offer specific information on how to get the best value, and...
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