Posts Tagged ‘taxes’

Business Travel Tips From a Road Warrior

Thursday, October 6th, 2011

Business Travel Tips From a Road Warrior

Radio-free rental cars. No room service. After traveling in good times and bad, our writer shares her tips — and horror stories.

By KRISTEN BELLSTROM

You have to admit, traveling on the company dime has its perks. On one California trip, I found myself in one of the biggest hotel rooms in Sacramento, a sprawling suite overlooking a koi pond, complete with two bathrooms, a wet bar and an Apprentice-style boardroom table for 12. I was recuperating from a long day of meetings, lounging in the plush hotel-issued robe and waiting for my indulgent dinner to arrive. But when the knock finally came, it wasn’t room service carrying a silver-domed steak or lobster tail. Nope — it was the trusty Domino’s guy.

With summer tans long faded, corporate travelers are in the midst of that old fall ritual: the business trip. This year, though, their return is more than business as usual. While experts are still assessing the impact of the recent economic and market news, millions of wheelie-bag toters are booking trips to Cleveland, Detroit and a host of other glamorous destinations. Business travel spending was up in the first half of 2011 and is still projected to rise 7 percent for the year, according to the Global Business Travel Association — not that that’s any consolation when you’re stuck on the tarmac.

After all, does anything ever go smoothly with business travel? Take flying: So far this year, 20 percent of flights operated by the major U.S. airlines arrived behind schedule. But that’s just a minor inconvenience; the same carriers also managed to leave 1,598 planes sitting on the tarmac for two hours or more and received 979,000 mishandled luggage reports. And that’s all before the car-rental company tries to stick you with a minivan or you discover that your hotel room’s not ready for check-in. Then there’s the pressure to travel on the cheap; in a recent survey of business travelers by online travel agency Orbitz for Business, 70 percent reported feeling obligated or “extremely obligated” to save their company money while on the road.

The Cost of Business Travel

(Average, Q1 2011)

  • Domestic Airfare: $247
  • International Airfare: $1,866
  • Domestic Hotel Rate: $150
  • International Hotel Rate: $238

Source: American express global business travel

In my case, the Cheesy Bread supper had less to do with saving my boss money and more to do with the fact that the hotel’s room service had shut down for the night at 10 p.m., which, of course, is just when many corporate travelers are arriving. Sit down with any veteran road warrior and you’ll get an earful of travel-disaster tales that will make you laugh — or, if you’re booked on the next flight out, perhaps cry. Working as a travel reporter for this magazine for the past five years has put me squarely within their ranks. By my estimate, I’ve logged about 120 hours queuing up at airports and nearly three days waiting to check in to hotels or pick up rental cars, all in the line of duty. Along the way, I’ve racked up my share of stories — from white-knuckle flights on bathroom-free airplanes to hotels where I seemed to be the only guest over 4 feet tall. (Steer clear of youth hockey tournaments — you’ll thank me.) Ideally, we learn from our mistakes, and with business travel on its way back, I can’t help but wonder if there’s anything my fellow travelers can learn from mine.

Cars? What Cars?

A line is never a good sign — especially when it’s composed of haggard-looking travelers with expressions ranging from “mildly annoyed” to “I will cut you.” But that was the sight that met me when I arrived at the rental-car desk at Los Angeles International Airport, fresh off a cross-country flight. It didn’t take long for the Kafkaesque explanation to make its way, telephone style, back to the end of the queue: The company — the car-rental company, that is — had no cars to rent.

And so, even though I’d made my reservation days earlier, I took a seat on my suitcase and waited. And waited. When, nearly two hours later, an agent finally called my name, I peeled out of the parking lot, rushing to get the precious car onto the freeway before they somehow changed their minds. That’s probably why I didn’t immediately notice that the car had no functioning interior lights (great for reading directions!) and that there was nothing but a sad plastic panel where the radio should have been. Related note: Driving with your iPod headphones on is illegal. Who knew?

New Business

Corporate travelers who haven’t been racking up the miles lately might be surprised by how much business travel has changed. Below, a look at a few of the biggest shifts.

Taxes

With many cities facing budget gaps, travelers are shouldering increasingly hefty tax bills — an average of $70 per three-day trip. In Chicago, the tax on a $55 car rental is now nearly $14, while New York City visitors pay an extra $26 a night on a $150 hotel room.

Mobile Apps

The app explosion is (literally) putting the power back in road warriors’ hands. Hotel Tonight, for one, allows travelers to book at the last minute — for up to 70 per-cent off. TripIt, which compiles itineraries, maps and more, lets users share those details with fellow travelers or bosses.

Green Travel

Eco-travel is trading tie-dye for pinstripe; one survey found that 28 percent of corporate travel departments now report on carbon emissions. And some Starwood hotels give travelers gift certificates or loyalty points for every night they opt out of housecleaning.

Keyless Check-In

Loathe lines? Hotel brand Aloft is testing a radio-frequency chip that turns guests’ loyalty-program cards into virtual keys. The hotel texts travelers their room number so they can skip the front desk.

In the world of car rentals, it pays to attach some mental air quotes to the word reservation. In fact, rental-car companies are often caught off guard when everyone who has reserved a vehicle actually shows up. That’s because, unlike airlines or hotels, which penalize people for blowing them off, rental companies don’t charge for no-shows, says Michael Kane, president of car-industry consultancy VRCG. And because some travelers make multiple reservations, companies often play a little loose with the number of cars they have available at any given time. It doesn’t help that agencies dramatically cut fleets during the recession; Abrams Consulting Group, which specializes in the car-rental industry, estimates that the number of available rentals has shrunk about 25 percent since 2006. As a result, says Kane, “they don’t have a lot of cars lying around right now.”

Is there a solution? Check your wallet. While struggling airlines and hotel companies have been chipping away at their loyalty programs (think fees to redeem rewards and swelling blackout periods), car-rental companies have largely left theirs intact. Even people without a zillion rentals under their belts can take advantage of perks like skipping the check-in line, and just the act of sticking with a single company should help bump you ahead of less-frequent renters when the pickings get slim. “They know where their bread is buttered,” says Kane.

Nickel-and-Dime Me, Please

Nothing works vacationers into a frenzy of rage faster than mentioning the airlines — and, specifically, the extra charges they’ve tacked on for everything from bags to pillows. But here’s a dirty little secret: Some of those add-ons are this business traveler’s best friend. After all, when I’m booking a trip, my corporate travel system will approve only the most fiscally responsible travel options — often prodding me to sign on for 5 a.m. departures or three-hour layovers, and always, it goes without saying, in coach. But once I’ve left the office, I’m free of the tyranny of the travel overlords. None of those midtrip purchases need preapprovals and, these days, a little plastic can go a long way. After all, on a single flight you can buy not only a better seat ($35) but also a decent meal ($8), Wi-Fi ($13) and a movie ($6). The corporate card still can’t control everything — if only you could buy an on-time arrival! — but in today’s world of air-travel torture, every little bit helps.

I doubt I’m the only traveler feeling the effects of the corporate travel crackdown. In a recent study by Expedia’s corporate travel service, Egencia, nearly half of North American firms said they were enforcing their travel policies more rigorously, while a survey Egencia conducted with the National Business Travel Association reports only 9 percent of firms that have revised their travel policies in the past two years now let travelers upgrade to first or business class on domestic flights. Sound familiar? Well, cheer up — it could be worse: You could be one of the 10 percent of corporate travelers who recently told Orbitz for Business that they’ve shared (or were encouraged to share) a hotel room on a work trip.

Analysts say companies, already coping with rising airfares, would like to bundle those extra fees into the bulk deals they negotiate with the airlines but that, so far, they haven’t had much luck. While a few corporations have told their employees exactly which fees they will and won’t cover, most are still sorting out how to cope with these charges, says Joel Wartgow, senior director at travel-management firm Carlson Wagonlit Travel, often leaving travelers to make the call. One of the most popular perks is Wi-Fi, and there, at least, we have some good news: In-flight Internet might be one of the few areas where extra costs are actually falling. According to research company In-Stat, airline wireless fees are projected to drop 24 percent by 2014.

Glamour and PowerPoint Make Strange Bedfellows

After years of staying in places whose idea of style is paisley carpet and sailboat paintings, I was thrilled when my company agreed to put me up in Los Angeles’s flashy Mondrian hotel. Sure enough, you do get starstruck by the beautiful people lounging in the lobby and the all-white room that looks like a particularly glamorous psych ward. But it didn’t take long for my practical side to start poking holes in the hotel’s glossy facade. First, it took ages to check in, with no DIY kiosk to be seen. Then, just getting my rental car out of valet parking was a half-hour ordeal. The final straw: The riotous late-night crowds at Skybar, the hotel’s trendy open-air bar, located directly outside my window. (Mondrian declined to comment on my stay, saying the property has since “relaunched.”)

There’s a reason those boring midpriced hotels did so well in the downturn. Sure, they’re cheaper, but it’s more than that. While trendier properties were still trying to woo travelers with their swanky bars and restaurants — none of which were getting much play on postcrash expense reports — more-basic hotels were doling out road warrior essentials like free Wi-Fi and breakfast. What’s more, experts say, during the boom years, some boutique hotels earned a reputation for prioritizing cool furniture and comely staff over traveler convenience, driving many business folks into the beds of more practical competitors.

But thanks to a lodging market that’s still lagging behind other aspects of the travel industry, even the most cutting-edge hotels are now catering to the suits. No hotel can survive without weekday (read: business) guests, says Jan Freitag, VP of global development for hotel-research company STR, forcing even the coolest properties to realize that “you have to be functional.” Indeed, a handful of new “lifestyle” hotels, including brands from the Virgin empire and from boutique-hotel godfather Ian Schrager, are specifically targeting no-nonsense road warriors with amenities like gratis Wi-Fi, 24-hour business centers, and laptop- and iPad-lending programs.

Alas, that all comes too late to save my stay at the Mondrian. After a night of Skybar-fueled nightmares, I checked out and moved into a nearby DoubleTree. Beige wallpaper never looked so good.

Why the belle has no clothes at the rental marketplace ball

Friday, September 2nd, 2011

Why the belle has no clothes at the rental marketplace ball

Posted by Special Nodes USA on 16 August 2011

NB: This is a guest article by Jay Karen, president and CEO of the Professional Association of Innkeepers International.

Airbnb and the fast-growing number of rental marketplaces seem like the belles of the ball among travel-related web sites this year.

Some have grabbed the support of big hitters like Ashton Kutcher and there is clearly a lot of money kicking about with nine-figure cash investments.

But let’s take a moment and turn the lights on in the ballroom and take a closer look at some of these belles. After all, if we’re going to dance with the belle, we better know what we’re dealing with.

mask

Propagating illegal activity

I’m not sure why the internet police haven’t been blaring the sirens on this one.

Nevertheless, there is no question many (if not most) of the lodging options that can be found on such websites are not complying with local laws.

Towns and cities across the country and around the world have local laws that prohibit homeowners – especially in residential areas – from using their properties as transient lodging for travelers of less than, say, 30 days.

In other words, it is permissible to be a landlord to a longer-term tenant, but it’s not okay to rent your house, apartment or room to folks night after night after night.

In many cases, such nightly tourism activity can disrupt the culture and atmosphere of a residential area or building (in the case of a condo building, where most of the occupants are homeowners).

It’s no secret that all kinds of questionable activity happens across the web, and the web companies do not bear full responsibility for the activity that happens on or on account of their sites.

In the US, the Communications Decency Act of 1996 does a good job holding websites harmless from the content that gets posted on their sites by site visitors or customers (look at Section 230).

But even a site like Craigslist came around to remove a section of their classifieds that was conspicuously advertising illegal activity. That only happened, though, after much public and legal pressure from a lot of powerful people around the country.

Getting back to rental marketplaces, why isn’t anyone crying foul on this one? Should a homeowner be required to show proof of compliance with the law before being allowed to list a room for rent (it might be happening on Oahu)?

Sure, but the inventory on such sites would likely fall to less than one-tenth of its current inventory. Who would pour hundreds of millions into a site with little inventory?

Licenses, inspections and taxation – oh my

Local authorities everywhere are in the business of ensuring the public’s safety. Regardless of your position on the “government-is-good or government-is-bad” spectrum, few will argue against making sure places of business that are open to the public deserve some kind of inspection or review process.

  • Do you like the fact that restaurants must be inspected? I do!
  • Do you like to know that hotels and B&Bs must follow local fire safety rules? I do!

But…

  • How many of the properties on marketplace rental sites, which mostly appear to be in residential situations, have been inspected by fire officials?
  • How many have the proper business licenses to be offering over-night accommodations to the traveling public?

Many online reviews indicate hosts are offering food to their travelers too, as part of the overnight stay. Do you think the local health inspector checked out their kitchen or sanitary food-handling skills?

Now, let’s talk taxes for a moment. Some rental marketplaces are not collecting taxes on behalf of their hosts, and the host is not likely collecting taxes either.

I know some readers are thinking the following:

“Does Uncle Sam need to grab something from EVERYTHING people earn? So what if some guy is making a little coin on the side by renting a spare room and not collecting taxes?”

Short-term lodging is usually subject to both a sales tax and occupancy tax. Oftentimes, the occupancy tax is levied to help support all kinds of initiatives to stimulate more travel to the area. Is it fair that a host gets to benefit from the traveler’s dollars, but not put in his fair share?

Safety

I already addressed the safety risks involved in not being inspected by local health or fire inspectors.

But ever since the likes of Airbnb and others materialised a couple of years ago, I’ve been telling people that I am just waiting for a tragedy to happen at one of the places rented on their site.

Some creep is going to rent his apartment to an unwitting young lady, and something terrible will happen. It happened with Couchsurfing.

Little did I know it would be the other way around!  The traveler, in this case, recently vandalized an Airbnb property, triggering reams of publicity.

Now, I do not think it is fair to hold Airbnb, in this case, fully culpable for such a transgression. Crimes occur at hotels all the time, but should the hotel always be blamed, let alone the online booking engine where a perpetrator might have booked a room?

No. But, reasonable measures, policies and the law of large numbers exist to try and minimize the likelihood of crimes taking place.

I get the allure of these rental marketplaces from many angles. To the traveler, “staying at an Airbnb”, for example, might be seen as something different and exciting.

The photos on the various homepages are nothing short of amazing, so it is quite seductive. Hosts see it as a cool way to make money and meet interesting people, although this Slate writer certainly differs.

Investors see a new product in the pretty traditional market of lodging. Heck, I represent an industry that perfected the “stay in someone’s home” experience!

But, the tens of thousands of hardworking innkeepers over the years worked WITH local authorities to gain proper recognition as legitimate businesses, have paid our taxes, have gone through inspections, etc.

This isn’t sour grapes about an imposter trying to co-opt our bed-and-breakfast brand (can you see the furrow on my forehead?). It’s bigger than that.

The bottom line, for me, can be explained in an analogy: do you think it would be ok for any one person or any family to start inviting random travelers and locals into their homes for a homemade supper…charge for it…not collect any taxes…and never get inspected by the health department?

Sure, you could just say “Caveat Emptor!”, let the online reviews handle the inspection process and not care about safety or a level playing field.

Would you feel the same way if a friend or loved one bought into this and got incredibly (or deathly) ill from an unfortunate event?

There is not much any of us can do to prevent bad or ignorant people from committing awful acts, but we can support reasonable policies and practices to try and minimize it.  Allowing such sites to propagate possibly illegal and potentially unsafe situations is nothing short of enablement.

Maybe it’s time to take a closer look at internet law and start holding web sites more responsible for what gets posted or what kinds of transactions take place on their sites.

Holding sites completely harmless has in turn caused a great deal of harm to many others (anyone want to talk about the proliferation of libel within online reviews, but the absence of any recourse for justice?), but no one in the travel industry really seems to be talking about that.

Maybe rental marketplace sites that actually collect the room revenue should be required to ensure the legality of their host properties.

Short of that, the rental marketplaces is not much more than pimps for illegal lodging.  Anyone want to propose a new Communications GREATER Decency Act of 2012?

NB: Airbnb, for example, has consistently stated it complies with local laws in the areas in which it operates.

NB2: This is a guest article by Jay Karen, president and CEO of the Professional Association of Innkeepers International.



«
» rss