This is a commonly used phrase surrounding the charter/fractional/ownership style of traveling that I'm deep within. It became even more evident on this past Wednesday when I traveled commercially with United down to Denver from Calgary for some security screening (fingerprinting).
I can easily say that I hate the commercial way of traveling, after experiencing what the private type of traveling has to offer.
Many of our clients view their time as quite valuable, and rightfully so. I'll now detail a couple of scenarios to help bring my point across.
Lets say my trip to Denver was that of a business nature. And lets say that I didn't have to go directly to Denver, but to another town nearby that's about an hour drive away from the closest International Airport. I need to be at a meeting with 5 of my associates by 12:30pm.
Commercial Travel time factoring:
Flight time to Denver: 2:00
Sedan and driver from Denver to town X: 1:00
Check in time/customs/security screening/grabbing bags: 2:30
Total time traveling: 5:30 requiring showing up at the airport at 7:00am.
Private Travel time factoring:
Flight time direct to town X (Jet fleet): 2:10
Customs/loading and unloading plane: 0:20
Total time traveling: 2:30 requiring showing up at the airport at 10:00am.
So now lets take into consideration some costs. 6 round trip tickets to Denver in business class $6-8,000. Sedan and driver to and from town X $500. Plus the likely hood of having to spend a night in a hotel in Denver for 6 people $1,000.
So we're roughly looking at total costs of approx $8,500. And total travel time of 30hrs. So our cost for each individual is $1,415 and 30 hrs worth of traveling.
Ok, so now lets look at the Private travel costs. 2:10 of flying in our jet at owner rates is roughly going to cost $5,000 each way, so $10,000 round trip. Per person we're looking at roughly $1,660 and total time of traveling at likely less than 10hrs! Starting to see some value in this way of traveling?
How about this then. Lets say we use the turboprop fleet instead. The travel time bumps up by 1hr each way, but the operating costs are significantly less. Total cost for the turboprop trip at owner rates would be about $2,500 each way for $5,000 round trip. Per person it's an amazing cost of $840 for lets say 12hrs of travel time!
This is why our business is thriving. We're able to take people from point A to point B and bypass 90% of the hassles of normal commercial flying. Not to mention that we can fly directly to mainy small airports and bypass all of the connecting flight mumbo jumbo. No taking your shoes off at the security line ups. Forget about waiting in huge lines that snake for miles in the terminal buildings. Customs will meet the airplane directly and are 'usually' a much more pleasant experience.
We don't just fly business executives around though, we do a lot of personal flying for people that do have a fair bit of $$$ who are just fed up with all the hassles of commercial travel. And can you blame them?!
So, how much is your time worth?
Friday, June 02, 2006
How much is your time worth?
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2 comments:
So got a question for you. When you guys do a trip, do you charge by head or just a flat cost for the trip?
Also how much does it cost to buy in? Would be interesting to think about this some more.
The trips are charged for the aircraft regardless of how many people are on board. So it'd cost the same if there was 1 person or 7.
And true, I did leave out the fact that there is an initial buy in cost to get these "owner rates". But the great thing is that when you buy in, say after 5 years you want out, you then sell your share at fair market value, so there is only depreciation to worry about in the long run. There are also monthly management fees, so these things do add up. But if this is your business, it's all a great tax writeoff, and in most cases it's always still outweighs the gong shows surrounding commercial travel.
Now one thing that isn't cheap with our company is charters. We charge top dollar because we prefer to just do our fractional flights and to help people realize that perhaps they should be considering it. But there still is the odd charter that we'll do. The going charter rates per hour on the turboprop is $1525 plus all incidentals (landing fees, usage fees, passenger fees, etc.) and the rate for the jet is nothing to sneeze at being $4350 per hour!
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