Category: Domestic Relocation Trends

Categories
Corporate Relocation Corporate relocation tips Domestic Relocation Tips Domestic Relocation Trends Global Mobility

When Is the Best Time to Budget for Relocating an Employee?

managers reviewing relocation budgets on worksheets
Group Of Business team meeting working and brainstorming new business project

When to Set a Relocation Budget

When a company is relocating an employee, there are many expenses to track and logistics to coordinate to make it happen. When creating relocation policies and benefits on behalf of the company, there are many aspects of relocation to consider. This can include buying and selling a home, moving the employee’s household goods, and short-term housing in the new location. 

With all of the complex movements required for a successful relocation, it can take time to know when to begin the budgeting process for the relocation. Should it happen before the position is posted? Before the employee is made aware of the opportunity? When does the company find the best prices for relocation services? While there isn’t a definitive answer, there are several mobility industry standards to consider when determining when to budget for the employee’s move.

The Right Time to Set a Relocation Budget

Typically, the best time to set a relocation budget is once the offer is extended to the candidate, especially if the company is working with a relocation management company. The primary reason is that the relocation company can work with the candidate to discuss their questions or concerns about the move. Allowing a relocation company to assist in the interview process can ensure the employee has their needs covered while the company is not overspending.

For example, an employee may have multiple cars that must be shipped to their new destination. After speaking with the candidate, the relocation company can then report back to the company on the potential costs and services needed to relocate the employee and their family. 

If the company’s policies only cover the cost of transportation for a single vehicle, that information can be communicated back to the employee. Policy restrictions play an essential role in helping companies control costs. However, some organizations may agree to an exception to their policy to assist the employee with their move and ensure acceptance of the relocation offer. These changes will impact the total cost of the relocation.

Alternatively, the second-best time to start relocation budgeting is once the candidate accepts the job offer. Now that the employee understands that he or she is moving, the relocation team can work with them on what to expect and allow them to get the most out of the relocation benefits offered by their employer.

How to Calculate for Relocation Costs

When planning for relocation costs, there are many things to keep in mind, specifically costs like: 

  • Real estate costs, such as buying and selling a home
  • Moving of household goods, cars, or pets
  • Travel expenses 
  • Storage facilities 
  • Temporary housing in the new location
  • Taxes 

Once all foreseen costs are accounted for, the relocation budget can be managed by the relocation provider. It is recommended that companies work with a relocation management company that utilizes relocation technology and software that can include real-time tracking of employee moving expenses. This helps companies not only stay on budget but create or renew budgets for future relocations. 

One of the first steps in calculating relocation costs is considering real estate expenses. This includes the costs associated with buying or selling a home. It’s important to factor in any fees or commissions involved. Additionally, if you’re renting a new place, you’ll need to account for the security deposit and any upfront rent payments.

Next, you’ll need to think about the cost of moving your household goods, cars, or pets. This can vary depending on the distance of the move and the amount of items you need to transport. It’s a good idea to get quotes from different moving companies to compare prices and find the best deal.

Travel expenses are another vital factor to consider. If you’re moving to a different city or country, you must account for the cost of flights or other transportation methods. This includes not only your travel but also any family members or pets that will be accompanying you.

Sometimes, you may need to utilize storage facilities during the relocation process. This could be necessary if there is a gap between when you move out of your current home and when you can move into your new one—research storage options in advance and factor in the monthly cost.

Temporary housing is often required when relocating to a new location. Whether it’s a hotel, rental property, or corporate accommodation, you’ll need to budget for the cost of staying in a temporary home until you find a permanent residence. Remember that these costs can vary depending on the location and duration of your stay.

Lastly, remember taxes. Depending on the country or state you’re moving to, additional surcharges or fees may be associated with the relocation. Researching and understanding the tax implications beforehand is essential to avoid any surprises.

To effectively manage the relocation budget, it’s recommended to work with a relocation management company that utilizes technology and software for real-time tracking of expenses. This allows companies to stay on budget and make informed decisions when creating or renewing budgets for future relocations.

Working with the Best to Setup Relocation Budgets

By considering all these factors and working with a reliable relocation provider, you can ensure your relocation costs are accurately calculated and managed. Planning and being thorough in your research will help you avoid any unexpected financial burdens during the relocation process. 

Global Mobility Solutions (GMS) is here if you have questions about developing relocation budgets. Our team can support your employees in getting the most out of their relocation benefits while your company can stay within your relocation budget. Our team understands that moving multiple employees every year can be challenging, so our tailored global mobility solutions can help any company of any size seamlessly move any number of employees.  

 Contact us today online or call 1.800.617.1904 to speak with one of our qualified team members. 

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Corporate Relocation Corporate relocation tips Domestic Relocation Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends

Reducing Moving Costs Through Government Relocation Incentives

view of city with mountains in background
Aerial panorama of Downtown Tucson, Arizona at sunset.

Check Out These U.S. Cities with Relocation Benefits Programs

Moving to a new place for a new job can be an excellent move for your career and your personal life. Starting somewhere fresh can give new beginnings and new opportunities. But what if the new company does not offer a competitive relocation package? Relocating for a position can be expensive, especially for an employee paying out of pocket; however, if the employee faces a once-in-lifetime job opportunity that cannot be turned down, making the decision even harder. 

A lot goes into the relocation process, from the home sale and purchase costs, movers to travel funds, and even food and temporary housing costs come into play. Even if the new job does not offer the employee relocation benefits, it might not be the end of the opportunity just yet. 

Many U.S. cities and states offer relocation incentive programs to take advantage of. Corporate relocation state subsidy programs are designed to help cover the cost for people moving for a job opportunity. Depending on the program, these incentives may apply to the entire state, region, or city. Here are some cities with the best relocation programs, with many of the programs focused on enticing remote workers in today’s new normal.

Cities & States with Relocation Benefits Programs

When looking for a new job, consider these relocation incentive programs offered by each city or state. Depending on what the relocation assistance covers, it could significantly reduce the cost of moving while also helping to break a tie between two employer offers.

Tulsa, OK

This remote working program is an innovative one. Tulsa offers workers up to $10,000 cash to help with relocation costs and a free workplace within an office space for any remote worker who moves to and works from the city. All employees have to do to qualify for the program is be at least 18 years old, work remotely in a full-time job, be eligible to work within the U.S., and be able to move to Tulsa within 12 months of accepting the relocation incentive.

Northwest Arkansas

To attract professional talent, the Northwest Arkansas Council offers incentives of up to a $10,000 lump sum for those looking to relocate. Recipients will also be given a free street or mountain bike to use on the new 162 miles of paved trails, the 37-acre Razorback Regional Greenway, and the region’s 322 miles of mountain biking trails. If a bike doesn’t suit the fancy of the moving worker, participants can also choose an annual membership to arts and cultural institutions.

Newton, Iowa

In 2014, Newton, Iowa, initiated The Newton Housing Initiative to boost home buying and construction. Investing in Newton’s infrastructure with a $190,000+ home yields a $10,000 cash incentive plus a “Get to Know Newton” package worth ~$2,500, with discounts at local stores and eateries.

To be eligible for this program, you must buy or build a new home worth $190,000. The reward is given at the final loan signing, and a certified appraiser must appraise the home’s value. The Newton home’s construction has to be completed before you receive the incentive, confirmed with proof of occupancy by the City of Newton. Rental properties do not qualify for this relocation program.

Savannah, GA

The Savannah Technology Workforce Incentive is willing to reimburse relocating employees up to $2,000 of relocation expenses. To qualify, applicants must be willing to work with a technology company in the region, be self-employed, or be remote workers looking to relocate to Savannah. Additionally, the employee must relocate within 12 months, have a minimum one-year lease or purchase property, and have resided in the county for 30 days before being able to apply

Tucson, AZ

Thinking of living in the desert? StartupTucson offers incentives totaling up to $7,500 in cash and moving services. Relocation funds, internet setup, and housing support are just some of this program’s benefits

The Shoals, AL

Another program geared toward remote workers, this relocation benefits package, is willing to pay moving employees $10,000 cash, which can go a long way in the low cost of the living area of The Shoals. To be eligible for the money, workers must have a minimum annual income of $52,000, be able to move within six months, be full-time employees, and be at least 18 years old. $2,500 of the incentive is given upfront for moving costs. The rest is given in two payments, the first after six months and the last after a year.

GMS Can Help Relocating Employees Utilize Relocation Incentive Programs

Are you a company that has been exploring innovative new ways to utilize a remote workforce? GMS can help you craft creative relocation policies while maximizing the relocation incentives programs offered by various state and local governments across the U.S. Contact us today to discuss how your company can obtain and retain the best talent from anywhere in the country and how to do so affordably.

Or if you’re an employee looking to take advantage of relocating on remote work policies, then feel free to contact as well. GMS is happy to announce our new Employee Choice Program, where we help remote workers get network pricing on moving services as they relocate to an unknown destination.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Domestic Relocation Tips Domestic Relocation Trends Global Relocation Challenges Global Relocation Tips Global Relocation Trends Relocation Technology

Relocation Technology: Trends Changing the Global Mobility Industry

young woman working on laptop
Shot of a young businesswoman using a laptop while working in her home office

Here’s a look at how technology is changing the employee relocation process

Modern technology has changed every industry. For the most part, each sector can use technology to its advantage and provide a more seamless customer experience. The relocation industry is no different. Relocation management companies (RMC) each have relocation technology that they try to utilize. 

There are different apps, programs, and systems that RMCs can deploy to their customers. But when taking a bid from an RMC to provide your company with global mobility programs, it is essential to ask about their technology specifically. Ask the RMC to provide you with a list of advantages on how their tech tools can help get your employees from point A to point B. 

Here is a breakdown of some of the increasing relocation technology trends in the global mobility industry:

VR House Hunting Trips

When working with an RMC to set up relocation packages, often house-hunting trips will be included. Usually, the employee is about to travel to their new destination twice to look at potential new homes and neighbors. But thanks to technology, relocating employees don’t have to cram all their house hunting into one or two trips. 

Virtual reality (VR) home showings have become increasingly popular since the Covid 19 Pandemic. Using ubiquitous 360-degree cameras can be a great way to showcase a property to a potential buyer anywhere, anytime. This tool gives the buyer a panoramic presentation of the house or apartment for sale. 

Many US real estate agencies have begun creating home listings with VR showcasing options. No one will buy a home without looking at it in person first. But at least VR setups can give a moving employee a worthwhile first look at a home they may want to purchase.

AR for Visualization Shopping

When moving to a new destination, setting up your new home or short-term housing option will be top of mind once you get there. That’s where augmented reality (AR) can be of assistance. AR technology combines virtual components to see what a surrounding area will look like if it’s changed. 

The most straightforward example to call out would be furniture shopping. Some apps use AR so that a customer can snap a picture of the area in the new home they hope to put the furniture in to see what it will look like. This is helpful when buying household goods for your new home. 

Another excellent example of how AR tech can be used is if home upgrades have to be made to your property in the new destination. If you want to reconstruct the backyard or remodel a bathroom, apps can give you a great layout of how the project will look once completed.

Cloud-Based Technology to Stay Organized

The most crucial piece of relocation technology that an RMC can provide is a portal where employees, employers, and relocation representatives can live-track the relocation process. Think of it as a portal where all the info on an employee’s move can be kept and accessed. This makes it easy for the employee to stay organized while the employer can track costs and spending. It also serves as a place where the relocation expert assisting the employee with their move can provide information and insight into oncoming steps for the move. 

This is something that every company should ask their RMC about. Using cloud-based technology so that it is up to the moment updated can keep everyone on the same page about any given employee’s relocation.

Doc-Signing Technology

An essential part of relocation is document signing. Numerous vital documents must be signed when someone is relocating—starting with their job offer letter to home buying and selling documents. Technology has made signing documents easy and more environmentally friendly. Gone are the days when you have to print, sign, and mail back stacks of paper. Plenty of apps allow companies and RMCs to review, edit, and sign documents within minutes. This not only saves on paper but saves on the chance of documents getting lost or stolen in the mailing process.

Cost of Living Calculators

When an employee accepts a position in a new destination, one of the first things that may cross their mind is the cost of living factors. Moving to a city that may cost more to live in, will affect the salary and relocation package negotiation. If working with an RMC, mention to them that having a legit cost of living calculator that can give precise numbers can be extremely helpful in the hiring process. 

If an employee can see side-by-side comparisons of the current cost of living vs. where the job is located, they can make a quicker decision. This allows everyone to move on faster, whether the employee accepts the relocation assignment or the company can proceed with other interviews.

GMS Is Always Up to Date on technology

Global Mobility Solutions (GMS) is the leader in the relocation industry regarding technology. Our award-winning customer service team assists employees to relocate seamlessly by utilizing MyRelocation®. 

MyRelocation® is a cloud-based system allowing transferees to track and monitor their relocation through a user-friendly dashboard. Employees can access benefits, communicate with their relocation coach, and stay informed of critical dates. Our tech, which won an award, is a valuable and robust asset for staff, with a user-friendly interface, easy menu layout, and functions.

Please contact us today for a free walk-through of MyRelocation® or a free courtesy call to benchmark your current relocation packages. One of our relocation experts will be more than happy to hear any of your relocation needs and then best assess how we can help you.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Corporate Relocation Corporate relocation tips Domestic Relocation Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends

Money Management Tips for Relocating to a New City

Here are some financial points to keep in mind after accepting a relocation assignment

With any job offer, one of the most important factors, if not the most important, is the salary. The number one reason employees seek a new position is to increase their pay. But what if you have to accept a relocation assignment in order to make that leap in the pay range? It is common for employees to consider moving to get a higher salary, better promotion, or a more enjoyable work environment. 

Whatever the reason, relocating for a job from a new company (or promotion from your current company), there is no doubt that finances will be top of mind. The first thing that must be kept in mind is that moving can be expensive if the company does not offer corporate relocation assistance. When interviewing for a position in a different state or country, be sure to get crystal clear explanations of what type of global mobility benefits are provided. 

But even after making the move official, there will still be money management skills that should be practiced. Here are a few financial tips when considering the relocation costs for a domestic move or an international assignment.

Do Thorough Research on the Cost of Living

The adjusted cost of living is the most obvious factor in accepting or rejecting a job in a new location. Before taking a giant leap, you’ll want to research some ordinary living expenses in the new city, such as rent/home prices, cars, gas, utilities, childcare, and other everyday expenses. If you are working with a relocation management company (RMC) to assist you in your move, it will be worth asking if they can provide a cost-of-living calculator.

Plugging some numbers into a relocation technology tool can help you understand how much money you’ll have to make and spend in your new destination. Once you have a clear picture, you can begin navigating your finances into a monthly budget that assures you’ll be stable in your new home.

Finding a Budgeting Style

In preparation for relocating, it is recommended to have a budgeting technique and do your best to stick to it. Setting a budget within your new cost of living allows you to see the scope of your finances to their extent. 

Popular Budgeting styles and techniques:

  1. Envelope method. Categorize envelopes for different expenses (e.g., rent/mortgage, groceries, gas, travel). Allocate money from paychecks to each. This method aids in monitoring spending and encourages mindful spending behavior.
  2. 50/30/20. Divide your paycheck into three parts: necessary costs (50%), leisure and pleasure (30%), and savings/debt repayment (20%). Adjust the percentages as needed; if you have more debts, increase the amount allocated to that category. This system is customizable and can be tailored to your individual needs.
  3. Zero-based Budgeting. Budgeting using zero-based systems divides your income into more minor, less expensive expenses. Record your income, then list the categories you need to spend each month. Estimate how much you will need to pay for each type until your total is zero. This way, you can be sure that every dollar will go somewhere, like your savings, rent, or groceries.
  4. The Pay-Your-Self-first Budget. A great way to put money aside to pay down debt and build your savings. Once you’ve paid off your debts, you can use the rest for anything.

GMS Can Provide Cost of Living Analysis

As stated above, it is always a good idea to get a scope on the cost of living for the desired state or city you are looking to move to. Global Mobility Solutions (GMS) is proud to call itself the leader in the relocation industry regarding technology. We are the pioneers of relocation technology. 

Our cost of living calculators can get you to point in the right direction from the start. From there, you can decide whether the relocation process suits you for this particular job. Our calculators are constantly updated and tested to ensure realistic answers. Please contact us today if you want more information on receiving a cost of living analysis for a new city. And always be sure to check our Knowledge base, where we post blogs about countless relocation topics.

MyRelocation Technology Logo

Our cloud-based MyRelocation® relocation technology is designed to help you streamline your company’s relocation management. Schedule a demo with a Mobility Pro for a no-pressure look at how our technology can help you.

Schedule a tech demo

Categories
Corporate relocation tips Domestic Relocation Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends

HR’s Role in Managing Employee Relocation

young family playing while they move in to their new home
A photo of playful parents holding sons's hands in new house. Happy and playful family are with cardboard boxes. They are in casuals.

Here is an overview of everything you need to know about getting an employee from point A to point B

Any company’s human resource department has countless staff relationship tasks, from approving vacation days to helping employees during their relocation process. The HR team is the company’s glue, holding together all the company’s processes and the backend paperwork regarding every employee. 

In most cases, the HR team is responsible for working with relocation services providers to work with the company to assist moving employees who accept a relocation assignment. HR teams will usually be in charge of getting quotes from relocation management companies (RMC), then working with the chosen RMC to set up the global mobility benefits that employees can utilize. If not taken care of properly, a lousy relocation process can hinder the hiring or retaining of skilled employees. A competitive and comprehensive relocation package is necessary to encourage employees to accept domestic and international relocation assignments.

HR’s role in employee relocations is significant; they must ensure a smooth transition by providing support. Global relocations are critical to every company’s success and should be taken seriously.

Setting Goals for Relocation Services

The HR team needs to come up with more innovative ideas when it comes to global mobility and employee relocation. In multinational companies, specific programs and procedures are in place to ensure employee hassle-free relocation. 

Any relocation plan that addresses and minimizes stress on employees and HR professionals must be appealing to transferring employees at any level on the organization chart. The employee must be able to relocate and be familiar with the process, often resolving questions regarding relocation and relocation issues.

Key Elements of Relocation Policies

There is no doubt that relocating employees can be a hectic process for all involved. But none more so than the employee and their family. That is why the HR team must cover as many benefits as possible so that the employee has the best chance of a smooth transition. It is a big ask for an employee to move states, or even countries, to work for a new company, which is why they should be taken care of. Here are some standard relocation services that should be covered in even the most standard packages:

  • Fair compensation adjustments are made if the living cost of the new location is higher than the transferee’s base.
  • Working with expert relocation coaches to assist relocating employees to guarantee low-stress, effective location change.
  • Paid trips to look for a house, multiple if possible, allow the employee and spouse to see homes that would work and get to know new neighborhoods that would be acceptable.
  • Moving and travel expenses are reimbursed to ensure that the shipping of the employee’s household goods is appropriately performed and minimizes the family’s costs to relocate to the new location.
  • Short-term housing options so the employee and their family can adjust to their new destination for a short period before buying a new home.

It’s HR’s Job to Introduce and Education New Employees about Relocation

As stated before, the HR manager and their team have countless tasks and processes to keep employees up to date on. But walking through the relocation policies with a new-hired employee is a vital task that should be considered. There should be a set company process setup for onboarding a relocating employee.

It is crucial to go over how, when, and where the relocation process occurs. Also, be honest and upfront with the employee on what they can expect during the move. Lastly, if working with an RMC that provides relocation coaches or one-on-one contact with a global mobility specialist, a company HR representative should introduce the employee to that assigned coach. On top of that, the company’s HR team should also act as a backup, best they can, if the relocation coach is unavailable for more than a few business days.

Need Help Updating or Creating Relocation Services?

Global Mobility Solutions (GMS) knows first-hand how busy HR teams can be. We want to help you and your team update or create your company’s relocation policies. Since 1987, GMS has been hiring the top relocation experts in the industry to ensure we can provide award-winning relocation services to our clients. 

Let us help you remove all the stress and concerns of relocating employees. We will listen to all of your needs and, from there, help you construct comprehensive relocation packages that employees will have a hard time turning down. But it is not only our goal to assist your employees’ move, but to keep relocation policies cost-efficient for your company. 

Our initiative technology helps employees, HR reps, and relocation coaches track the relocation process from start to finish. We have a cloud-based system that helps track everything from payments and recipients to household goods shipping. 

If your HR team is ready to discuss how to set up an excellent relocation process for both employees and the company, then set up a free consultation with one of our relocation experts, who will get you on the right track.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Choosing a Relocation Company Corporate Relocation Corporate relocation tips Domestic Relocation Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends Global Relocation Global Relocation Challenges Global Relocation Tips

3 FAQs About Working with a Relocation Specialist

relocation specialist helping transferee move
Female Inventory Manager Shows Digital Tablet Information to a Worker Holding Cardboard Box, They Talk and Do Work. In the Background Stock of Parcels with Products Ready for Shipment.

Here are some common questions about working with a global relocation provider

Moving to a new state for a new job isn’t easy. The relocation process alone can be a daunting task just to think about. All the packing and planning can make anyone stressed out. But to make the process go by with as little fuss as possible, it is highly recommended to work with a relocation specialist. 

If the new job you are moving for provides a relocation package, then there is a good chance that the opportunity to work with a relocation specialist is included. If talent mobility coaching is not provided in your package, it may be worth asking the relocation management company (RMC) that you are working with if one-on-one relocation management is possible to add on. Either way, working with a designated specialist has numerous advantages. 

Here are 3 FAQs and answers about working with a relocation specialist:

1) What Is a Relocation Specialist?

In simple terms, a relocation specialist is assigned to help an employee handle all of the logistics of their move as they prepare to work for their new company. There are a lot of moving pieces when it comes to executing a successful relocation process. A relocation specialist will bring knowledge, expertise, and experience in talent mobility. 

A reliable relocation specialist will be able to explain all aspects of the new company’s relocation package. They can help you review real estate programs, including home buying and selling assistance. As well as assist in coordinating with a moving company to get multiple quotes and schedule which day the movers can show up to move household goods.

2) How Much Do Relocation Specialists Charge?

There is no easy or short answer to this question. It depends upon each employee’s needs and wants when it comes time to move. Global relocation service providers offer a long list of services that can be covered, but it depends on the relocation package the hiring company offers their new employees to move. 

This should be asked by the employee in the negotiation stage of hiring. If the company mentions a move is mandatory for the position, the employee should follow up by requesting a list of relocation costs and services that the company will cover fully or partially. It’s also worth asking how the costs are covered because there are different types of relocation policies. Some companies may offer lump sum relocation packages, others may go the route of old-school reimbursement policies.

3) What’s the Process Like to Work with a Relocation Specialist?

Each RMC will have a different process for domestic and international relocation services. Most relocation specialists will start by hearing all of the employees’ pain points about the move, then proceed swiftly to assist in overcoming those pain points. Each relocation expert will have their own checklist on how to go about handling predestination stages all the way to getting the employee to their first day at the new position, from listing the employee’s current home to getting corporate housing in order, to helping with all the formal paperwork needed for a move. 

The relocation specialist’s main job is to keep the move smooth while keeping the employee’s relocation process on a timeline.

GMS Has Relocation Specialists Ready to Help

Global Mobility Solutions (GMS) has been leading the international relocation services industry since 1987. We only hire and work with the best relocation specialists in the business. Our team is thoroughly trained and qualified to help get employees from their current homes to their new destinations. 

GMS provides companies with relocation packages that have options to give each transferee their own relocation coach. This coach will provide one-on-one assistance to the employee they are assigned to in order to make the most seamless relocation experience possible. If you are ready to hear more about our relocation coaching options, please reach out to schedule a free consultation today and always feel free to check out our blog in our Knowledge Base to get any other relocation questions answered.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Domestic Relocation Trends Global Relocation Trends Household Goods Relocation Challenges

Household Goods Summer Update

Big truck of delivery company with cargo is driving on forest road in the mountains at sunset.

The HHG Industry & The Summer of 2022

While the summer household goods moving season is heating up, 2022 is shaping to be hotter than usual. The summer of ‘22 is the perfect storm which includes a range of issues the industry has been battling for some time, such as driver and labor shortages, not to mention the high gas prices as of late. Today, there is a range of new challenges, compounded by the lingering events of the pandemic and higher fuel costs.

These factors boil down to several key areas:

  • Increased Volume
  • New Storage Challenges
  • Challenges with Materials & Supply
  • Air & Sea Freight Cost Volatility
  • International Port Delays
  • Continuing Driver & Labor Shortages

It is important to remember that many of these challenges are beyond the control of the relocation and household goods (HHG) industries. So let’s dive into today’s major challenges facing the household goods transportation industry.

Increased Household Goods Move Volume

Move volume is up across the industry, an increase over currently elevated levels that have been present for the past year. Corporate relocation volume is up over 2022 and has been approaching pre-pandemic figures from 2020 and 2021. 

Additionally, U.S. military moves have been restarted, accounting for a large portion of typical HHG traffic. Previously, these moves were on hold throughout 2020, with few exceptions for emergency or national security moves. As a result, military relocation volume has suddenly jumped, nearing its typical summer volume.

COD/Consumer business

Volume began to skyrocket in 2020, with consumers deciding that they wanted to make significant life changes during the pandemic. This was accelerated by work-from-home policies, with companies allowing their workforce to live and work from anywhere with an internet connection.

Due to increased demand, COD pricing has become elevated. This increase in consumer pricing will continue to harm those relocating employees that are provided a lump sum benefit in place of a comprehensive relocation package. Their moving budget will no longer stretch as far as it may have in previous years, placing these transferees in a tight spot.

Heightened increases in consumer moves have caused a resurgence of “rogue movers,” fly-by-night moving companies who prey on individuals looking for cheaper moving options. This increases the risk that transferees who receive lump sums as their sole relocation benefit may fall victim to similar scams as they try to conserve their funds for moving.

HHG Storage Challenges

Household goods storage capacity is not something that the industry worries about very often. As a result, few in the business today have encountered it before. Well, hello, summer 2022, we’ve got ourselves a shortage of storage!

Storage Capacity for Personal Property

HHG shipments that required storage options have declined for more than a decade. In the past, the real estate market was well balanced, and most shipments were delivered directly to the transferees’ new homes, bypassing the need for storage entirely. 

This decline in storage needs pushed many in the industry to downsize their warehouse spaces to lower overhead costs, shifting to smaller, less costly facilities.

Today’s red hot real estate market has caused an increased overlap rate for the typical transferee’s relocation timeline. In 2022, homes are still selling quickly, forcing employees to move out sooner than anticipated. Once at their destination, the highly competitive market prevents employees from finding suitable housing promptly. It has become common for homes to be sold before the family can even view the property. This translates to extended stays in temporary housing for the family while their household goods are put into storage until a home can be secured. While many around the country expect the real estate frenzy to cool off, there’s no way to level out numbers until that happens.

Additionally, some shipments must be stored further away from the transferee’s ultimate destination, leading to potential costs beyond what would typically have occurred with a closer storage facility.

HHG Labor Constraints

Storage in transit deliveries for corporate relocations is typically handled by local labor that the local destination agent arranges. The existing labor shortage that the industry has been dealing with has been compounded by the effects of the pandemic, further restricting supply. This limited labor pool specifies the development of creative solutions for operating trucks.

Materials & Their Impact on Household Goods

As many have seen in the news, the cost of simple building materials at your local hardware store has almost quadrupled over the last year. This is another excellent example of supply and demand playing out in real time.

Lumber

The cost of lumber is up, spiking as high as 347%! Primarily, this has impacted the housing sector, with builders and consumers taking a hit on the cost of new builds. In addition, the household goods and storage industry has dramatically increased the cost of 3rd party crating.

Additionally, as new storage vaults and warehouses are being built/bought to meet demand, higher costs, limited availability of materials, and a slower building pace result.


source: tradingeconomics.com

Corrugated Cardboard

The ideal packing material for most household goods moves, the cardboard box, has been steadily increasing in price for a decade now, thanks to the rise of the eCommerce and flat-pack furniture giants.

Costs have continued to rise in concert with the rise in demand for household goods. However, there is good news – While the price is rising, supply currently appears to be meeting the demand for packing materials.

Fuel Costs

Another newsworthy item is extremely high gasoline costs have risen in recent months, exemplified by the interruption of supply pipelines on the East Coast. As a result, clients have raised concerns regarding gasoline prices and how this would translate to HHG move costs. However, the rise in gasoline costs does not directly correlate to the price of diesel, which the household goods industry runs on.

  • Most household goods transportation equipment runs on diesel and not gasoline.
  • Diesel pricing was rising until February and has leveled off considerably since then.
  • There are fuel surcharges on all interstate HHG moves, a process that has been in place for over two decades.

Fuel surcharges are determined by the average price of a gallon of diesel as calculated by the U.S. Department of Energy on the first Monday of every month. The new fuel surcharge (if a change is required) goes into effect for shipments loading from the 15th of that same month through the 14th of the following month. This helps to level off any volatility in fuel prices.

Blog - Chart - Gas Diesel Prices

HHG Air/Sea Freight Pricing Volatility

Supply and demand have caused air and sea freight pricing to remain volatile around the globe. This has been compounded by the overall reduction of flights, leading to limited availability to air freight transport. However, many in the industry are hopeful that we’ll be back on track within the next 12 months. 

Also, lift vans, a typical wooden container used in international shipping, are in short supply. These containers wear out over time and need to be replaced. However, with the ongoing lumber shortage, replacements are more costly and more challenging to come by.

Continuing HHG Driver & Labor Shortages

Driver and labor shortages continue to plague the moving and storage industry. The HHG industry has made sustained attempts to attract talent with varied results. The uptick in volume and the increased costs of doing business have led to a more acute awareness of these shortages. As a result, the industry has explored the need for alternative modes of transport (such as small containerized shipments) and continues to utilize these methods.

What Can Companies with Household Goods Shipments Do?

Many of the relocation industry’s HHG transportation challenges are simply out of anyone’s control. Simply put, TIME has become the critical factor for many of these challenges. It will take time for these issues to unravel themselves:

  • Material supply will catch up with demand
  • The housing market will cool which will lessen storage demand
  • Over time, international ports will catch up with their backlog

However, for companies that need to relocate their employees, time is a powerful ally. Now, more than ever, companies should work to initiate their employees’ HHG services as early in the move process as possible.

  • This will allow your relocation team to set the right expectations upfront and help ensure your employees arrive at their destination as quickly as possible, ready to work.
  • The earlier companies can initiate relocations for their transferees, the sooner HHG services can be scheduled and coordinated.
  • The more accurately a transferee can project their final move date, the more quickly the move can be added to the list of summer moves.

GMS Is Prepared, Let's Talk!

Do you have questions about the household goods industry? Let’s talk!   Global Mobility Solutions (GMS) is a leader in global workforce mobility. We help companies build and operate competitive relocation programs for talent acquisition and retention strategies. 

Our goal is to make every relocation experience smooth for those moving. Our services can help every step of the way, from pre-decision, to moving day, to getting settled in the new destination – GMS is here for you.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Domestic Relocation Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends Global Relocation Tips Global Relocation Trends

2022 Gas Prices Impact Relocation Costs and Estimates

semi truck driving through desert at sunset
Large semi truck hauling freight on the open highway in the western USA under an evening sky.

Learn how higher fuel prices impact the shipment of household goods

There is no question that the recent rise in fuel prices has had an impact across the board on many industries. From pain at the fuel pump to increases in prices at the local grocery stores, people are spending more on a weekly basis. The talent mobility industry hasn’t been immune to the effects of increased fuel prices. However, the industry is making strides in developing more accurate estimates that account for higher gas prices. In the relocation industry, these costs are typically passed down from vendors to relocation management companies (RMCs) which, in turn, results in increased direct costs for companies relocating their employees.

In a typical relocation or assignment, anticipated relocation costs are calculated via a needs-based estimate. Meaning each relocation assignment is unique and could cost a different amount, depending on the employee’s needs. But just how much does the price of gas affect how much it is to move an employee? Which aspect of the relocation process is hit the hardest when fuel is expensive? Here is a breakdown has to why relocation costs go up when fuel prices increase:

Shipment of Household Goods

The largest impact of high fuel prices on relocation naturally resides within the process to ship household goods (HHG) from point A to point B. The packing and transporting of furniture and other belongings is a critical component of any relocation program. Companies that offer relocation benefits often will make sure to include covering, or at least reimbursing, an employee’s need to have their household goods shipped to their new destination. Industry-leading RMCs will obtain multiple bids from moving vendors to help ensure the best possible cost. In most cases, the RMC will have established partnerships with numerous vendors who are vetted and reliable, but they could reach out to a newer vendor for a better deal if need be. These bids from transportation companies are largely estimated on how many pounds of household goods need to be moved and how many miles away the destination is. These are two of the more obvious figures that are directly connected to gas prices and the total cost of the move.

What is the Impact of Fuel Surcharges on the Shipment of Household Goods?

With fuel prices quickly on the rise, take this opportunity to learn how fuel surcharges are calculated for domestic relocation HHG shipping. On the first Monday (or Tuesday) of every month, the van lines each go to the US Department of Energy’s (DOE) database to access the average cost of diesel for the entire United States. The average price has a corresponding number on a chart that most HHG vendors use, which will indicate what percentage to use for the fuel surcharge. 

For example: If diesel is at an average of $4.84 per gallon, then the common surcharge would be 16%. The new fuel surcharge will be applied to any shipments loading after the 15th of that month. 

HHG estimates are completed using the current fuel surcharge. The difference between the fuel surcharge when the estimate is completed and the load day fuel surcharge will result, sometimes ending in an increased amount, depending on market conditions. Relocation experts have seen this happen before when fuel surcharges spiked in 2009 and impacted moving expenses. 

It is worth mentioning that fuel surcharges are always non-binding, even on talent mobility policies that may hold some type of guarantee not to exceed cost estimates. This type of HHG estimate is commonly used by RMCs as part of an overarching, comprehensive cost estimate that is used to help companies gain a clearer picture of the total projected cost of relocation.

Do Companies Need to Update Relocation Policies?

Many companies look into what are called “Capped Relocation Policies.” Meaning, there is a pre-approved, maximum budget the company is willing to pay up to for moving the new employee. Working with an RMC helps companies to stay within that cap for each employee who is transferred. This policy design method is effective in helping to contain runaway costs and can provide a measure of consistency with your total mobility program spend.

However, in today’s environment, some capped policies are quickly eaten up by increased fuel surcharges. This is making it difficult for companies to stay within the approved budget while relocating. In some cases, the budgeted amount isn’t enough to fully execute the move and is leaving the employee to make up the difference. If a company finds this to be occurring frequently, a review of your policy caps might be in order.

This is another great advantage of working with an experienced RMC to ensure that your company is not overpaying for relocation costs while offering competitive relocation benefits within your industry.

GMS Is Here with Explanations on Relocation Costs

We know that the relocation process and the costs associated with it can be confusing. That’s why Global Mobility Solutions (GMS) offers free consultations to anyone who has questions about talent mobility. Our relocation experts will walk you through a common outline of relocation packages and their structure during this online or in-person consultation. From there, you make the decision if you would like us to help you either create or rewrite your relocation policies. When a company offers relocation policies to job candidates, they open their hiring field to a wider range of top candidates for any given position. Let GMS assist you in all of your relocation needs, contact us to start getting all of your questions answered. 

Ready to Calculate Your Program Savings? Request Access Now!

Are you ready to calculate your potential relocation program savings? Request access to our easy-to-use Relocation Cost Savings Calculator. Your Mobility Pro will grant your access request within 1 business day.

Categories
Domestic Relocation Challenges Domestic Relocation Tips Domestic Relocation Trends Employee Development Global Mobility

4 Products in Low Supply: Impact on Relocating Employees

Two men, one with beard and wearing a red shirt, other wearing a blue short, former California residents move a sofa into their new home in Nevada

Pricing on these products could affect relocation

It can be more complicated than just hiring a moving company to ship their household goods when relocating an employee. Many factors need to be taken into consideration when getting a transferee to their new destination. One of the significant factors to think about is the cost of living difference between their current home and the new destination. When certain products or materials are harder to get or are experiencing pricing increases, it can place additional pressure on the employee and jeopardize the relocation. 

Since the COVID-19 pandemic began, there have been supply chain issues and shipping delays around the world. Some products are back-ordered for months at a time, ultimately increasing prices on many products, further complicated by lack of manufacturing productivity. This can affect those moving for a new job through increased prices on common cost of living items such as food and fuel, potentially increasing employees’ wage requirements. While companies can’t always raise salary expectations right away, keeping the cost of living changes in mind when sending the employee an offer letter is recommended. 

If your company relocates employees, these four product shortages might affect their lives in their new destination:

Food Costs

This one probably hits close to home for a lot of people. With grocery stores also having labor challenges and with problems in food production, grocery prices may stay higher than usual in 2022. COVID-19 and its variants upended operations in food manufacturing plants around the world. As workers called in sick or day-to-day production policies had to be changed to keep workers safe, many fell behind in their order fulfillment and still have not caught up yet. Food product shortages are also due to the trucker driver shortage that the US and Canada are experiencing right now. 

When you look at the difference in food costs from city to city, that alone creates a cost of living increase or decrease. Typically, groceries are more expensive in high-end markets such as San Fransico, CA than in Topeka, KS. The addition of product shortages and shipping problems adds to the total price for someone moving from a mid-sized or small city to a larger one.

Lumber

Lumber prices have soured as of late to the point where homebuilders are increasing prices in an attempt to offset the demand. Many lumber mills were forced to shut down during the pandemic due to safety concerns. Then when the mills reopened, they were already behind in producing enough lumber to fulfill the extreme housing market needs. The real estate trends in calls for lumber were not just new-build homes either. As many workers started working from home and mortgage rates dropped to new lows, there was a rise in home remodeling. 

Many people might not realize that the price of wood also impacts moving supplies such as paper and cardboard. Lumber prices for the shipping industry also impact items such as shipping crates and pallets, which are produced for moving companies. Increases in material prices are naturally passed along to the end-customers who are moving.

Furniture

Always known as the “hidden cost of moving,” buying furniture for a new home is something that most people don’t calculate when making offers on houses. The furniture industry saw a boom when work from home became the new normal for many workers. People were more likely to spend more updating their furniture in order to be comfortable while spending most of their days from home. Because many U.S. furniture parts come from China, the global shipping container shortage has delayed many shipments that have some furniture companies months behind on orders. Once again, because of all the issues with shipping containers, the furniture industry can only ship out so many sets each month.

Semiconductors

Demand for computer chips has naturally lowered supply. Many companies are shifting their workforce remotely, meaning more laptops and computer products are needed for employees working from home. Semiconductor manufacturers are trying to ramp up production, but with sky-high demand, it is hard to see them catching up to the curve before the end of 2022. 

Additionally, semiconductors are used in vast swathes of products these days, including vehicles. Near the onset of the pandemic, rental car companies sold perceived excesses in their fleets. Demand surprisingly skyrocketed, but due to shortages in semiconductors, vehicle manufacturers couldn’t keep up with rental fleet production demand which, in turn, caused shortages of rental vehicles. This has caused significant increases in rental car costs for employees who are relocating and need temporary transportation while traveling.

GMS Keeps You Up to Date with Industry News

At Global Mobility Solutions (GMS) we take pride in being the industry leader for providing global mobility services. Our team assists companies in relocating employees and providing benchmarking studies specific to our clients’ industries. We also keep our customers on top of industry trends in relocation, real estate, transportation, and more. Fill out the form below to receive courtesy information on your particular industry today!

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Categories
Choosing a Relocation Company Corporate Relocation Corporate relocation tips Domestic Relocation Domestic Relocation Tips Domestic Relocation Trends

The Most Googled Questions About Relocation Services

woman doing research on moving
A beautiful young woman planning an overseas trip on the internet

Answering common questions about relocation packages and the global mobility process

Companies that are just starting to research information about relocation services may need to get some of their basic questions answered. Global Mobility Solutions (GMS) has been a leading relocation company for over 34 years. Our team members are all highly qualified for their positions and are experts in their specialty regarding relocation services. As there are a lot of moving parts when it comes to relocating employees, our team put this guide together in hopes of providing some answers to the most Googled questions. Most of these questions are commonly asked when companies with in-house programs (or no program) are considering outsourcing their mobility programs to an experienced relocation management company.

Here are those Q & A’s:

What Are Relocation Services?

Also known as talent mobility or global mobility, corporate relocation services are benefits provided by an employer or agency to an employee who has to move for a new position or promotion. In simple terms, relocation services are “moving perks.” When the employee accepts the position, they are provided with some different options to help them get to their destination smoothly in time for their start date. Depending on what type of benefits are offered, relocation services usually can be applied to individuals and families alike. International relocation and domestic relocation services are slightly different, but the idea remains the same. 

In most instances, the hiring company will have already signed on with a relocation management company (RMC) to construct and deliver comprehensive relocation packages in order to ensure their talent acquisition program is as competitive as possible.

What’s Included with Relocation Services?

Relocation packages offered to employees should be tailored to fit the company’s objectives, along with employees’ wants and needs. Relocation services can vary in what is offered to, and utilized by, the employee. Common benefits range from assistance in selling a home to temporary housing assistance, school/area tours, and more.

Often, the most common theme among talent mobility perks is financial help with moving costs and shipping of household goods. Sometimes, the company will even offer to cover the cost of hiring moving services completely. Other companies may offer reimbursement options for relocation costs, meaning the employee foots the bills upfront to get to their new destination and the company repays them usually via check or EFT payment. 

Side note: GMS recommends that companies offer employees relocation packages instead of reimbursement options. At GMS, we assign each moving employee a dedicated single point of coordination (a U.S. Domestic Relocation Coach or a Global Assignment Manager). This certified GMS team member is highly experienced in their field and will provide guidance to your employee every step of the way during the relocation process.

How Much Can You Expect to Spend on Relocation Services?

That’s an excellent question. From the hiring company’s standpoint, paying to provide relocation services will depend on a number of variables. How many employees need to be relocated? Are these employees individuals or moving a family with them? Is the company willing to cover the costs of the entire move or just partial support? Are real estate perks offered in the package? 

Going back to the idea that relocation benefits should be tailored to fit the company’s objectives and employees’ needs, it’s hard to put a price range on just how much relocation services cost. Relocation costs are typically worth it in the long run because it increases the chances of getting the right candidate in the right seat for the vacant position. These employees arrive stress-free and ready to work, and are shown to stick around longer. Without global mobility benefits, your company runs the risk of having to hire and train multiple people over because only local talent is applying for the job.

What’s the Average Timeline for Relocating?

When helping companies create their relocation benefits, GMS usually recommends that there be a designated timeframe in which the policies can be utilized. This timeline will vary from company to company, or position to position. In many cases, a 90-day window for employees to start their relocation process does the trick. Employers need to keep in mind that these new-hire employees may have families, and trying to move a family with children is something that cannot always be done within a few weeks. Additional factors should be taken into account as well, such as the time it takes to sell the employees home, or the availability of transportation services for their household goods.

In extreme cases, the company might give the employee a start date within a month of the offer. But the downfall with this approach might be the employee may decline the offer, or the company’s relocation costs will increase if services are needed ASAP and not planned out.

What if an Employee Doesn’t Use/Need Every Relocation Benefit Offered?

GMS prides itself in our proactive relocation coaching. By having a Relocation Coach or Global Assignment Manager assigned to each employee, GMS helps to ensure the relocator is using the right mix of benefits for their unique situations. This can help them to get the most out of their available and applicable benefits, whether it be helping with moving costs, spousal support, or language training. GMS’ relocation experts help to pinpoint why employees may or may not utilize certain benefits to make sure the employee is getting the support they need without contributing to inflated mobility program costs due to the use of unnecessary services.

What Is Corporate Housing?

When thinking about accepting a job out of state, one of the most sought-after relocation benefits is corporate housing. Also known as short-term housing, this benefit is recommended for employers to provide as it might seal the deal for the new hire to sign on.

Corporate housing is usually a 30, 60, or 90-day stay in a furnished apartment or townhome that is covered by the employer. The reason this is such a draw for relocating employees is because it gives the employee and their family a transitional period to get their feet wet and learn a little bit about the lifestyle of their new destination. This period of time is also valuable as it provides the employee a place to live during the period of time it takes for them to secure a new place to live and await the delivery of their household goods. It also can be used for a situation where the employee has to go ahead of their family for the job, while their family finishes up any loose ends before the relocation completely takes place such as kids finishing the school semester.

How Often Should We Review Relocation Benefits?

GMS urges companies who are offering relocation packages to look into reviewing or updating those benefits every 12 to 18 months. The reason being, industries become more competitive and employee needs can evolve. If a competing company in your industry is offering more money or benefits to new hires, it could make it harder for your company to attract the top talent you need.

GMS Is Here to Answer All of Your Relocation Questions

When it comes to your talent mobility strategy, there are thousands of questions about where to begin or how to improve. The relocation experts at GMS have been helping companies move their employees for over three decades. If you have any questions about creating, reviewing, or improving your mobility program or relocation services, please reach out today. Our team can answer any questions you may have while offering insight into alternatives and enhancements to already existing relocation packages.

We're Here to Help! Request a Courtesy Consultation

Are you ready to talk to a Mobility Pro? Learn how GMS can optimize your mobility program, enhance your policies to meet today’s unique challenges, receive an in-depth industry benchmark, or simply ask us a question. Your Mobility Pro will be in touch within 1 business day for a no-pressure, courtesy consultation.

Accessibility by WAH

Looking for something?