Understanding the Cost of a Relocation Services RFP 

Issuing a Request for Proposal, (RFP) for relocation services is a significant investment for any organization. It is crucial to understand that issuing an RFP is not just about evaluating Relocation Management Companies (RMCs) but also about the time, effort, and resources to manage the process effectively.

Cost considerations can vary depending on several factors, but direct and indirect costs are generally involved.

These costs stem from the time, resources, and effort required to manage the RFP process. Below are some key considerations in issuing an RFP for relocation services, followed by examples of associated costs and how this investment can lead to long-term benefits for your company.

6 Key Considerations include:

Understanding the Cost of a Relocation Services RFP

1) Internal Resources and Time Commitment

    • Personnel Involvement: The RFP process often requires input from HR/mobility, finance, legal, and procurement departments. Each department may need to review proposals, assess the RMC’s capabilities, and coordinate meetings. Depending on your organization’s structure, this can be a resource-intensive process.
    • Time Investment: The process typically takes several months, depending on the complexity of your relocation program, the staff’s schedules, and the number of proposals received.

2) RMC Selection Process

    • Evaluation: Companies must establish criteria to assess RMCs’ capability of managing their programs, including service offerings, reputation, and past performance. Some organizations do this through a formal Request for Information process.

3) RFP Preparation and Administration

    • Document Drafting and Design: Preparing the RFP requires a comprehensive understanding of your company’s relocation program needs and may include the help of specialized consultants or internal subject-matter experts.
    • Reviewing and Responding to RMC Questions: Clarification questions are part of the RFP process. Upon receipt of the questions from potential RMCs, the company will consult with relevant internal teams and/or subject-matter experts to craft the responses.

4) RMC Proposal Evaluation

    • Time spent reviewing proposals: Reviewing multiple RMC proposals requires time and careful consideration. This is especially true if numerous individuals are involved in the review process. Organizations may allocate time from various departments, including HR/Mobility Managers, Procurement Officers, and finance experts
    • RMC Presentation Costs: In most cases, shortlisted RMCs are invited to present their proposals in person or via virtual meetings. Cost considerations include time spent by internal resources planning and attending the presentation. This includes follow-up discussions.
    • Contract Negotiation: Once the RMC is selected, a detailed contract negotiation occurs, which may involve legal counsel reviewing terms and conditions.

5) Estimated Process Cost

While the cost of the RFP process can vary, companies should be prepared for an investment of anywhere between $30,000 – $40,000 (or more), depending on the scope and complexity of the relocation program being outsourced, the level of internal resource involvement, consultants/advisors involved, and any 3rd party procurement platforms used. For smaller companies with fewer relocations, the cost may be lower. Larger organizations with a high volume of moves may see higher costs due to more complex programs, detailed evaluations, and vendor negotiations.

Cost Example

Below is an example of how RFP costs might break down for a typical relocation RFP for a mid-sized global organization with 100 relocations per year. The costs can be higher for more extensive programs, depending on loaded salary costs, the number of people involved, program complexity, and scale (U.S. Domestic, International, Global).

Resource
Procurement Manager or Equivalent
Global Mobility Manager or Equivalent
Global Mobility Director or Equivalent
Compensation Manager or Equivalent
CHRO or Equivalent
Legal Review
Estimated Hourly Salary
$62
$80
$64
$71
$176
$87
20% Added Benefits
$12
$16
$13
$14
$35
$17
Hourly Weighted Cost
$74
$96
$77
$85
$211
$104
Est. Hours Required for RFP
120
80
80
60
40
40
Weight
100%
100%
100%
100%
100%
40%
Total Cost
$8,928
$7,660
$6,144
$5,100
$8,433
$1,666
Total: $37,951

6) Other Cost Considerations:

    • Opportunity Costs: While more challenging to quantify, the company should also consider the opportunity cost of dedicating resources to the RFP process. During the time spent managing the RFP, these resources may not be available to focus on other vital projects, such as supporting ongoing employee relocation efforts or other core business operations.
    • Consulting or External Expertise Fees: In some cases, companies may hire external consultants or experts to assist with drafting the RFP, evaluating proposals, or providing industry insights. This can add additional costs to the process, ranging from a few thousand dollars to tens of thousands, depending on the level of support required.
    • Software & Tools: If the company chooses to utilize software or platforms to help streamline the RFP process (such as automated RFP platforms, vendor management systems, or third-party procurement tools), there may be additional subscription fees or costs associated with these tools. Depending on the platform, these costs can range from hundreds to several thousand dollars.
Issuing an RFP for relocation services can be a substantial financial and time investment for a company

Issuing an RFP for relocation services can be a substantial financial and time investment for a company.

However, the benefits often far outweigh the costs when the process is conducted strategically by investing the time to evaluate multiple providers and choosing a partner that offers value, high-quality services, long-term flexibility, and better alignment with your company’s needs.

These savings, combined with improved employee satisfaction and retention, can yield a significant return on investment, particularly as your relocation program scales over time. 

WHR Global's Free RFP Generator

Our free tool takes less than 1 minute to complete!

Answer a few simple questions, and you’ll be ready to run your RFP!

WHR Global,a leader in global mobility, is an independent, full-service relocation management company with offices in the US, Switzerland, and Singapore. WHR strives to offer cost-effective relocation benefits without compromising empathy, ethics, or service

Information Systems Security: A Good Defense is a Good Offense

Security – whether online or offline – is extremely important.

According to Identity Theft Resource Center, the number of data breach notices issued in 2024, was 1,350,835,988 (and those are just the ones that were officially reported!).

Every day, we entrust our information to others, hoping that they will keep it safe. But what steps are they really taking? And, are they following through? Just one mistake on the company’s part can leave thousands of individuals primed for an attack.

It’s an epidemic.

That’s why it’s imperative that companies focus on physical, infrastructure, and operational security. As they say, a good defense is a good offense! There are a variety of ways companies can strategically approach security. But to be truly effective, more than one measure should be taken and used in conjunction with the others.

Cyber Security is a top priority for WHR Global and we have always taken proactive measures to secure confidential data for clients and their transferring employees.

Information Handling

    • The way your organization chooses to manage your electronic information is the foundation of a strong security plan. Data encryption translates your data into concealed code, which greatly reduces the vulnerability of attacks from hackers and data thieves. Utilizing a Transport Layer Security (TLS) certificate on your website encrypts any data communicated over the internet.

Secure Infrastructure

    • To keep pace in the ever-changing security landscape, it’s important to have measures in place to protect infrastructure. Firewalls, guest networks, and endpoint protection are additional critical components. Coupled with encrypted backups and off-site storage of information assets, you’re looking even better.

Security Best Practices

    • Organization-level security is important, but a culture of security is also crucial. Best practices surrounding password creation should be relayed to your teams. With the number of online tools available, it is highly likely that your employees are creating their own passwords. Instruct them not to use easily found information (i.e., birthdays, anniversaries, pet names, etc.). You should also host an annual security training to remind your staff of your protocols.

Audit

    • Another way to ensure data is continually protected within your organization is to complete frequent internal and third-party audits. At WHR, we undergo an annual
      SOC 1® (SSAE18 Type II) audit. A third-party organization extensively evaluates our systems design, operating effectiveness, and internal controls. We elect to participate in this audit to uphold our client commitments to data integrity.

Following Security Regulations

    • Beyond what a company can choose to do, there are many things that companies must do. There are a plethora of security regulations depending on the industry and the type of work completed. The most recent regulation buzzword is “GDPR” – the data protection rules set forth by the EU. Other regulations across many industries include the Federal Information Security Management Act (FISMA), the Health Insurance Portability and Accountability Act (HIPAA), the Family Educational Rights and Privacy Act (FERPA), the Payment Card Industry Data Security Standard (PCI-DSS), the Gramm Leach Bliley Act (GLBA), and so many others.
WHR Global Security Icon

Data Security – A Top Priority at WHR Global

The fact is, data security must be a top business priority and become part of the corporate culture.

It’s something that we take very seriously at WHR Global. We ensure that our employees are up-to-date on information security best practices, not only for our company, but for their personal safety as well.

We understand that we possess sensitive and confidential data relating to our clients and their transferring employees. We have always taken proactive measures to secure information against accidental or unauthorized access, disclosure, modification, or destruction and to assure everyone involved of the availability, confidentiality, and integrity of our data.

A Security Tip from Jeff Beyer,
WHR’s IT Director

Everyone loves online shopping!

It’s important to remember that you’re exposing yourself to threats each and every time you enter your credit card online.

Many sites offer two factor authentication, and I strongly recommend you enable that when possible.

It definitely doesn’t eliminate attacks, but it can help protect you when there is one.

Our Custom Technology Solutions and on-site IT Team are available to cater to your mobility program’s specific needs:

9 Items to Include in Your Next Relocation Management RFP

If you have ever been through the Request for Proposal, (RFP) process for employee relocation services, you know how stressful and time-consuming it can be.

An integral part of every RFP is the detailed timeline.

This timeline explains when the RFP was sent, the due date, when questions are due from bidders, when you are to respond to questions, and dates for the next steps (presentations, start date, and more). However, the timelines often underestimate how long some items take to complete.

Sometimes, Relocation Management Companies (RMCs) will have dozens of questions requiring responses, which can add several business days to the process. This often results in extensions and delays that you did not anticipate when going out to bid.

In this post, we have outlined 9 of the most common questions that RMCs ask after receiving an RFP.

RFP proposal timeline includes deadlines and 9 Items typically asked by RMCs

The 9 questions below are actual questions
from RMCs in actual RFPs from the past 24 months.

The goal should be to answer these questions up front in your RFP before ever sending it to an RMC.

This will save you a significant amount of time during the Q&A process and enable each bidder to provide you with a response that more accurately addresses your needs.

1) Can you please provide copies of your relocation policies?

RMCs require access to your relocation policies or a detailed summary to tailor their pricing and responses accurately to your needs

This is the most commonly asked question.

RMCs want to look at your policies to tailor their responses and pricing to your program. It helps to provide all of your relocation policies or, at a minimum, a detailed summary of your original bid package so that prospective bidders know exactly what you are looking for.

Some RMCs suggest policy changes that suit your needs and budget without adversely impacting the employee’s transition.

2) Do you have any preferred or company-designated third-party suppliers or vendors?  If so, can you please provide the company names?

Including existing relationships and specific requirements in the RFP allows RMCs to show how they’ll work with your current providers and disclose any related management fees.

Typically, RMCs will work with client-designated service providers.

However, they expect your provider(s) to meet their quality standards to maintain a consistent, excellent experience for your relocating employees.

Describing any existing relationships and specific requirements in the RFP gives the RMC an opportunity to demonstrate how they will interact with your existing preferred providers and disclose any associated management fees that may occur. 

3) What is your annual volume?

Include detailed annual volume information in your RFP and a clear transition profile ensures a more accurate bid.
When answering this question in your RFP, include:
  • Number of homes sold per year
  • Number of renters you relocate
  • Any short-term domestic assignments
  • Lump Sums
  • Internship programs
  • Other relevant information
A precise transition profile results in a more accurate bid response.

4) What type of home sale benefits does your company offer?

The most common home sale benefit types include a Guaranteed Buyout (GBO) or Buyer Value Option (BVO) program and Direct Reimbursement (DR) program

Do you offer Buyer Value Options (BVOs), Guaranteed Buyouts (GBOs), Direct Reimbursement (DR), or marketing assistance only?

    • If so, how many of each do you typically offer in a given year?

This information tells the RMC what areas and processes to focus on in their response and provides the most accurate pricing structure.

An experienced RMC will also help you to evaluate each method and determine which is most beneficial for your company.

5) What is your average home sale price?

Knowing the average home sale price helps each RMC determine a fee structure for your home sale program

This information is essential if you offer home sale benefits to your employees.

  • Knowing the average home sale price helps each RMC determine a fee structure for your home sale program.

Additionally, providing the average home purchase price gives the RMC a good idea of the type of home you are interested in finding for your employee.

6) What are the top challenges that you have with your current program?

Sharing any challenges you're facing and areas for improvement in your RFP allows the RMC to propose solutions that can improve the process for you and your employees.

RMCs are well-acquainted with the myriad of challenges that occur when relocating employees.

  • Do you need help with exceptions or failed relocations/assignments?

Letting the RMC know some of the problems you are having and the areas you would like to see improved in your RFP allows them to suggest solutions that will enhance the process for you and your employees.

7) What are your historical locations?

Including historical information in your RFP helps the RMC identify volume discounts, particularly if you frequently relocate to the same destinations.

Listing out historical information allows the RMC to scout volume discounts, especially if you frequently move to the same location.

  • What are your top departure location(s)?
  • What are your top destination location(s)?
  • Do you have locations that have been historically challenging?
    (e.g., remote/small towns.)

Providing these details enables the RMC to share their knowledge and familiarity with the locations you list and provide any creative solutions to meet the needs of your relocating employees.

8) Will the RMC be taking over any existing files?

It's crucial to inform your prospective RMC whether they will need to take over any ongoing relocations or assignments. If so, specify the number and outline the expectations.

It’s important to let your prospective RMC know whether or not they will be required to take over any existing relocations or assignments. If so, indicate how many and what the expectations will be.

  • Primary considerations for the RMC include where the employee is in the process

    • Domestic – is there a home sale involved?
    • International –  how much time is left on the assignment?

Providing some detail on this upfront in the RFP will enable the RMC to provide you with their criteria, which determines how certain types of files will be transitioned, as well as recommendations for those files that should stay with your current provider until completion.

9) If you have international assignments, does the global scope of work include any compensation services?

By providing detailed information on International assignments, including compensation services, the RMC can share its capabilities and processes and offer accurate pricing for these services.

Compensation services would include:

  • Creating the compensation calculations and balance sheets
  • Updating the balance sheets
  • Tracking the compensation data
  • Working with your payrolls to ensure proper payment and reporting
  • Providing the year-end compensation summary report to your third-party tax provider to prepare the assignee tax return

By providing as much detail as possible about this, the RMC will provide you with its capabilities, processes, and appropriate pricing for this service.

Including all of these points in your RFP does not guarantee
that there will not be any questions.

However, it will make the responses more uniform, reduce the number of questions from the responding RMCs,
save you some time, and ensure that you are comparing similar responses.

WHR Global's Free RFP Generator

Our free tool takes less than 1 minute to complete!

Answer a few simple questions, and you’ll be ready to run your RFP!

WHR Global,a leader in global mobility, is an independent, full-service relocation management company with offices in the US, Switzerland, and Singapore. WHR strives to offer cost-effective relocation benefits without compromising empathy, ethics, or service

Buyer Value Option (BVO) vs Guaranteed Buyout (GBO) Home Sale Programs. How Do they Compare?

In the realm of corporate relocation, home sale assistance programs play a crucial role in easing the transition for employees and companies alike.

Among the relocation home sale programs, the most popular options are the Buyer Value Option (BVO) and the Guaranteed Buyout Option (GBO) programs.

Each option offering distinct advantages tailored to different needs, our blog will review:

BVO vs GBO Home Sale Benefit home sale with contract

Buyer Value Option
(BVO)

In a Buyer Value Option program (BVO), the employee is responsible for listing their home for sale, with marketing assistance from the Relocation Management Company (RMC). The employee must secure an outside buyer willing to purchase the home at a fair market value. A buyer value option program provides all the tax benefits to the employer and employee, but it depends on the employee securing an outside buyer. The employee is funded their equity, if the contract is deemed valid, based on the outside offer amount. The RMC closes the sale with the buyer at a future date. In a BVO home sale scenario, home appraisals are never ordered.

Buyer value options are a good way for an employee to oversee the entire process and ensure the best fit for their home. The risk of the home sale falling through falls onto the employee in this home sale option.

Guaranteed Buyout Option
(GBO)

What is a Guaranteed Buyout (GBO) program and how does it differ from a Buyer Value Option (BVO)?

Under a GBO program, the RMC orders two home appraisals and then averages the two to determine a guaranteed offer, with a fixed acceptance period. If the employee cannot sell their home on their own, the employer takes the home into inventory. The employer must maintain it until the company can resell it. This carries potential risks and additional costs for an employer.

A BVO home sale, on the other hand, minimizes this risk since the employer only purchases the home after the employee has secured an outside buyer. BVO and GBO home sale programs provide tax benefits to the employer and employee.

BVO Home Sale versus GBO Home Sale

When comparing the two, the choice between BVO and GBO depends largely on the company’s risk tolerance, market conditions, and the level of support they wish to provide to their employees.

BVO programs are cost-effective for companies but can place additional burdens on employees, making them more suitable for strong housing markets.

Conversely, GBO programs, while more expensive, offer greater assurance to employees, making them a preferred choice in uncertain markets or when a company prioritizes employee satisfaction and seamless relocations.

Relocation Home Sale Comparison reviews Buyer Value Option versus Guarantee Buyout Option

Here’s a side-by-side comparison of Buyer Value Option (BVO) and Guaranteed Buyout Option (GBO) home sale programs

Program Structure
Risk to Employee
Risk to Company
Home Sale Timeline
Employee Involvement
Financial Considerations
Market Impact
Flexibility
Appeal to Employees
Usage
Buyer Value Option (BVO)
Employee secures an outside buyer before the company purchases the home
Low risk if the home is sold quickly; however, the employee bears the risk if the market is slow
Lower financial risk since the company only purchases the home after an offer is secured
Typically, longer as the employee must find a buyer before the company purchase
High, as the employee is responsible for marketing and negotiating the sale of their home
Costs are generally lower for the company, but the process can be more stressful for the employee
The success of the BVO depends heavily on the current housing market
More flexible for companies that prefer to minimize upfront financial commitment
May be less attractive to employees due to potential delays and uncertainties
Preferred in stable or strong housing markets where homes are likely to sell quickly
Guaranteed Buyout Option (GBO)
Company provides a guaranteed buyout offer to the employee before listing
No risk to the employee as the company guarantees a buyout, regardless of market conditions
Higher financial risk for the company as they commit to buying the home regardless of market conditions
Generally faster, as the company buys the home directly if it doesn't sell within a set period
Lower, as the company takes over the home sale process after providing the buyout offer
Higher costs for the company due to the guaranteed purchase but provides more certainty and support for the employee
The GBO is less impacted by market conditions as the company assumes the risk
Less flexible due to the company’s financial commitment but provides more stability for employees
Generally, more appealing to employees due to the certainty and reduced personal risk
Often used in slower or volatile markets where securing a buyer may be difficult

Our countless years of BVO and GBO Home Sales experience can help you better navigate your journey.

This can include the range of tax implications, relocation variables, benefit payouts/amounts, and marketing work.

Let the experts at WHR Global help you with your BVO or GBO home sale relocation
and other global mobility program needs

WHR Global,a leader in global mobility, is an independent, full-service relocation management company with offices in the US, Switzerland, and Singapore. WHR strives to offer cost-effective relocation benefits without compromising empathy, ethics, or service

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The Best Types of Expatriate Assignments for Your Mobility Program

Finding the right person for an open position can be challenging, especially in today’s job market. Offering international assignments can be a powerful tool for retaining (and attracting) top talent.

Employees who are given the opportunity to work abroad feel more valued and motivated, leading to higher levels of engagement and loyalty.  Additionally, international assignments can be seen as a prestigious career move, which can attract high-caliber candidates and enhance the company’s reputation as an employer of choice.

The complexities of an international move have intensified in recent years.  Beyond offering a pay raise, covering relocation expenses, or finding them an incredible new home, it is crucial to address the broader needs of expatriates and their families.

In today’s dynamic work environment, assignments can quickly go off course if not managed with a focus on flexibility, cultural integration, and the overall well-being of the employee. 

A lot of preparation and planning goes into sending your employees abroad, which is why it is important to understand the advantages and disadvantages of the most common types of expat assignments: long-term, short-term, and extended business travel.

Pros and Cons of the 3 Types of Expatriate Assignments including Long Term, Short Term and Extended Business Traveler

Some companies may choose to use just one type of assignment or include multiple different options, depending on the employee and the position available. Either way, finding the best expat program for both your company and your employee will ensure both are successful long term.

Long-Term Expat Assignment (LTA)

A long-term assignment (LTA) refers to the relocation of an employee from their home country to work in a foreign country for an extended period, typically ranging from one to five years or more.  Unlike short-term assignments (STA’s), which might last only a few months, LTAs involve a deeper commitment and often require significant personal and professional adjustments for the expat employee.

During an LTA, the employee is expected to fully integrate into the local work environment, often taking on key roles that contribute to the company’s strategic goals in the host country.  This could include tasks like establishing new operations, leading a local team, implementing corporate strategies, or facilitating knowledge transfer between the home and host offices.

One of the most important things to note is that this type of assignment is not a permanent transfer; the employee intends to return to his or her home country after the long-term assignment is complete.

Long Term Assignment container shipment of household goods

Pros_Green-CheckmarkPros of a Long-Term Expat Assignment

LTAs provide a unique opportunity for employees to develop leadership skills in a global context.

By exposing them to different markets, cultures, and business practices, companies can groom future leaders who are adaptable, culturally aware, and capable of managing diverse teams. These global experiences are invaluable for shaping executives who can drive the company’s international strategy.

Expat employees often serve as a vital link between the headquarters and the host country’s office, ensuring that the company’s global strategies are effectively implemented at the local level. In the past, it was important to instill the culture of the parent company into the foreign entity and help drive revenue growth in the overseas location.

Today this still exists, but the opposite is also true. Overseas workers are being deployed to the parent country or other countries to gain experience, transfer knowledge, and run specific project-based work.

 

Con-Red-Checkmark Cons of a Long-Term Expat Assignment

One of the biggest challenges of long-term expatriate assignments is the potential strain on personal and family life. Relocating to a foreign country can disrupt children’s education, create challenges for a spouse’s career, and lead to feelings of isolation due to cultural differences and distance from extended family and friends.

Not all LTAs succeed. If an expat employee fails to adapt to the new environment or if personal issues arise, the assignment may need to be cut short, leading to significant costs. Costs are extremely high for expat assignments and many companies do not properly vet the individual being offered the assignment.

There are benefits available including candidate assessments and pre-decision services that are designed to assess the person’s ability to thrive in a “foreign” location and adapt culturally.  Additionally, many companies forego cultural and language training which is essential in providing a foundation for a successful transition.  Simple things like how to conduct a business meeting or learning the norms for handing out a business card are just some of the subtle social norms that will ensure success. Unfortunately, many companies choose not to or do not know the importance of this investment.

There are countless compliance requirements as well, and without the assistance of a relocation company, it can be hard to navigate. Many companies have chosen another route: short-term expat assignments.

 

 

Short-Term Expat Assignment (STA)

A short-term assignment (STA) typically refers to a temporary work arrangement where an employee is relocated to a foreign country for a limited period, usually ranging from a few months to a year.  Unlike long-term assignments (LTAs), which often involve significant life adjustments such as family relocation and long-term planning, STAs are more focused on specific projects, skill development, or filling immediate business needs.  STA’s can offer great flexibility and less commitment, but less fluidity and insurance.

Many companies will not allow the family to accompany the employee on these STAs but will provide other options such as more frequent trips home, furnished accommodations, per diems, travel allowances, etc.

Relocation management companies like WHR Global, can help manage short-term expatriates and provide the structure and benefits available to this group of assignees.

Short Term expat assignment with small shipment of items

Pros_Green-Checkmark Pros of a Short-Term Expat Assignment

The problems of dissatisfaction and homesickness became apparent with long-term moves, so short-term overseas engagements were developed as an alternative to pulling up roots and moving families across the globe for extended periods. Short-term assignments involve fewer personal and professional disruptions for employees. Family members often remain in the home country, minimizing the impact on schooling, careers, and social networks.

From your company’s perspective, a short duration generally costs less upfront, and it gives you more flexibility when developing a mobile, global workforce. Additionally, the consequences of individuals becoming “taxable” in the foreign location can be managed effectively, thus significantly decreasing the cost of the expat assignment.

Lastly, the pool of willing candidates inevitably increases as it is a short-term expat assignment, which reduces the potential impact on families and financial ramifications.

Con-Red-Checkmark Cons of a Short-Term Expat Assignment

The cons of short-term expatriate assignments revolve around demands to rotate a variety of personnel, which requires more planning and administrative time for everyone involved.

There is a trade-off between a series of short-term assignments versus a single long-term assignment.  What works for your company may not work well for others.

These assignments allow companies to leverage global talent efficiently while providing employees with international exposure and professional growth opportunities without the extended commitment of a permanent move.

Extended Business Traveler (EBT)

An Extended Business Traveler (EBT) program is a structured framework designed to manage employees who frequently travel internationally for business over extended periods, typically ranging from a few weeks to a few months.

Unlike traditional expatriate assignments, EBT programs cater to employees who remain officially based in their home country but spend significant time working in foreign locations. These programs are increasingly popular in global companies as they allow for flexibility and quick deployment of talent across borders without the need for full relocation.

Typically, these employees are not on a formal assignment; however, there are still potential tax and immigration considerations that need to be made when sending someone on these extended business trips.

Extended business traveler

Pro_Green-Checkmark Pros of an Extended Business Traveler

EBT programs allow companies to deploy talent quickly and efficiently across multiple locations without committing to long-term relocations. This flexibility is ideal for addressing short-term business needs, project launches, or client demands. For everyone involved, business traveling simply causes less disruption.

Your workforce has much more control over how they perform duties, and you do not have to permanently allocate resources to a foreign location.

Con-Red-Checkmark Cons of an Extended Business Traveler

Work visa requirements differ widely from country to country and can be impacted by the home and host locations involved.

In some instances, a worker may enter the country on a work permit waiver, but in other countries it may be illegal to perform a single work duty without having the proper work visas in place.

Conclusion

How companies manage expat assignments has changed in this post pandemic world. Ever changing immigration policies, unpredictable travel restrictions, and increased costs make managing these assignments more challenging than ever before.

Regardless of the assignment type that is considered, each type of expatriate assignment has its strengths and pitfalls. Every company needs to determine what is optimal for their workforce and the business needs requiring these assignments. Let the experts at WHR Global help guide your employees and company through these types of decisions and implementations.

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What is a Buyer Value Option (BVO) Home Sale Program?

A BVO home sale program is a program which is designed to help relocating employees sell their homes quickly and efficiently without the company taking ownership of the property.

According to WHR’s 2024 Global Mobility Benchmark, a BVO program remains one
of the most competitive relocation offerings

  • 60% of respondents offer home sale and/or purchase benefits.
    • Of those,
      • 59% offer BVOs to new hire non-executives
      • 78% offer BVOs to new hire executives
      • 67% offer BVOs to existing employee non-executives
      • 74% offer BVOs to existing employee executives
Buyer Value Option (BVO) Home Sale Program

The best way to describe a BVO is in the context of
a traditional Guaranteed Buyout (GBO) program

Under a GBO, the relocation management company (RMC) orders two home appraisals and simply averages the two to determine a guaranteed offer.
As an example:

  • Appraiser A values a relocating employee’s home at $330,000
  • Appraiser B values the same home at $335,000
  • $332,500 is considered the “GBO”

The relocating employee then takes the offer of $332,500 and moves to their new location, unencumbered by their former home. In turn, the RMC sells the property on the
open market, and the employer is charged for all of the associated real estate expenses upon the conclusion of the sale.

The employer can treat the home sale costs as “business expenses,” so none of the expenses are considered income to the employee (for federal tax purposes).
This process is validated by the IRS in Revenue Ruling (2005-74), which specifically addresses this type of home sale program.

What is a Buyer Value Option (BVO)?

Essentially, BVO is very similar to a GBO, with the exception that with a BVO home sale program, no appraisals are completed. Instead, the buyout offer is based on a bona fide fair market offer received by the employee from a qualified third-party buyer. With BVO, the employee is responsible for listing their home for sale, and receives marketing assistance from the RMC.  

Once a contract is deemed valid, the RMC offers to buy the home from the employee at a price based on the outside sale price, and the employee is funded their equity based on this amount. The RMC will enter into a new listing agreement with the employee’s broker and proceed to close the transaction with the outside buyer while honoring all agreed terms and conditions. All home sale costs are treated in the same manner as with a GBO program.  

The BVO home sale program provides all the tax benefits to both the employer and employee. However, it is the responsibility of the employee to secure an outside buyer ready, willing, and able to purchase the property at a fair market value. 

Why should you offer your relocating employees a BVO?

    • Tax Savings: A properly structured BVO program that adheres to IRS requirements provides significant tax savings that benefit employees as well as employers.
    • Minimized Risk for Employees: Employees avoid the financial risk and stress of carrying two mortgages if they have to move before their home is sold.
    • Expedited Relocation: Employees can move to their new location more quickly, knowing that their home sale is being managed.
    • Cost Efficiency for Employers: Employers can manage relocation costs more effectively and help maintain employee productivity by reducing the stress and financial burden associated with home selling.

WHR Global provides the following
BVO support to help your employee
sell the home to an outside buyer:

    • Obtain two Broker Price Opinions (Broker Market Analyses)
    • Reconcile the two opinions of value
    • Suggest a listing price
    • Develop a comprehensive marketing strategy
    • Obtain pictures of the home
    • Provide tips to paint, declutter, etc.
    • Assist with Realtor selection
    • Obtain weekly feedback from Realtor
    • Assist in contract negotiation

Be aware: From a cost standpoint, when selling a home, the following expenditures are typical in a home sale transaction. 

When selling a home, there are several expenditures in a typical home sale transaction
  • Real Estate Commissions
  • Recording Fees
  • Transfer Taxes
  • Title Expenses
  • Notary
  • Escrow Fees
  • Seller Concessions
  • Repairs
  • Inspections
  • Miscellaneous

A Buyer Value Option home sale program is a valuable tool for companies looking to support their relocating employees. By assisting with the home sale process, companies can alleviate a significant source of stress for their employees, ensuring a smoother transition and enhancing overall job satisfaction.

For the company, this can translate into higher retention rates, more successful relocations, and a stronger ability to attract top talent. 

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