UpFront - January/February 2010

Driving on Demand

by Karen J. Bannan

Until 2008, Boston-based IT consulting firm NSK & Associates was spending $60,000 each year on employee automotive-related expenses. "Our 32 employees were required to own cars. We paid for parking and mileage so they could visit clients while at work," explains Nancy S. Keddy, the company’s CEO. Looking for a way to cut costs, the company signed on with car-sharing service Zipcar, reducing expenses by 54 percent in 2008.

Zipcar, which is available in more than 50 cities in 24 states, works like this: A company signs up for the service, sometimes paying a one-time registration fee and either a per-driver annual fee or a minimum monthly commitment fee, depending on the city. Once signed up, users pay per use--either daily or hourly. Fees vary by market. Zipcar for Business hourly rates range from about $7 to $9, while daily rates range from about $60 to $69. Fees include gas, insurance and 180 free miles for the day. For example, New York drivers pay $69 daily or $8 hourly during the week; Chicago users pay $66 and $7, respectively. There are individual plans available, too.

For NSK, using Zipcar has added significantly to its bottom line, Keddy says. "The first thing I thought when I saw our savings was, ‘Wow, now we can make another hire.’ It also opened our job pool because now anyone--not just car owners--can work for us. That means we’re not excluding talented people just because they don’t own a car."