What is Ancillary Services?


Also known as	Ancillary products, optional services, travel extras, add-ons
Category	Air travel, hotels, ground transport, travel cost
Common in	Airlines, hotels, low-cost carriers, corporate travel programs, expense reports

What Are Ancillary Services?

Ancillary services are extra amenities or add-ons that a traveler can purchase in addition to the basic fare or room rate. Examples include onboard food and beverages, checked baggage, seat upgrades, lounge access, Wi-Fi, early check-in, and priority boarding.

This matters because many airlines and hotels now keep base prices low and rely on ancillary services for a large share of their revenue. For travelers and companies, that means the real cost of a trip can be much higher than the headline fare if many extras are added. For example, a cheap flight might double in cost once a traveler adds a checked bag, a preferred seat, and onboard Wi-Fi.

In business travel and expense management, understanding ancillary services helps companies control the total trip cost, design clear travel policies, and avoid surprise charges that show up later on expense reports.

Understanding Ancillary Services in Detail

Key Components of Ancillary Services

Ancillary services fall into a few major buckets:

Airline Ancillaries

Checked and extra baggage
Seat selection and upgrades—extra legroom, exit row, or business/first upgrades
Priority boarding and fast-track security
Onboard food, beverages, and snacks
In-flight Wi-Fi and entertainment
Lounge access and day passes

Hotel Ancillaries

Early check-in and late checkout
Room upgrades and view upgrades
Parking fees
Resort or facility fees for pool, gym, or spa access
Breakfast and meal packages
In-room Wi-Fi, where not free
Business center and meeting room access

Ground Transport Ancillaries

GPS or navigation devices for rental cars
Child seats
Extra drivers
Toll passes and roadside assistance upgrades

Each of these items is optional and separate from the base airfare, room rate, or rental price, but they often feel essential to travelers.

How Ancillary Services Evolved

In the past, many services were included by default. For example:

Checked bags and basic meals were often part of a standard airline ticket.
Hotel Wi-Fi or breakfast was frequently included in the nightly rate.

Over time, especially with the rise of low-cost carriers and intense price competition, providers began to:

Unbundle services from the base ticket or room
Advertise very low base fares to appear cheaper in search results
Charge separately for extras, turning ancillaries into a major profit driver

Now, it is common for airlines and hotels to earn a significant part of their profit from ancillary revenue—not just base fares and room rates.

Types and Categories of Ancillary Services

You can think of ancillary services in three groups:

Comfort and Convenience	Functional and Safety	Experiential or Premium
Extra-legroom seats Early check-in and late checkout Lounge access Priority boarding and fast track	Checked baggage and sports equipment Child seats in rental cars Travel insurance, when sold by the carrier Wi-Fi for work on the move	Business- or first-class upgrades Premium meals and drinks Hotel spa packages Premium rental car categories

Comfort and Convenience

Functional and Safety

Experiential or Premium

Extra-legroom seats

Early check-in and late checkout

Lounge access

Priority boarding and fast track

Checked baggage and sports equipment

Child seats in rental cars

Travel insurance, when sold by the carrier

Wi-Fi for work on the move

Business- or first-class upgrades

Premium meals and drinks

Hotel spa packages

Premium rental car categories

Common Misconceptions About Ancillary Services

“Ancillary services are always optional luxuries.”

Not always. For many trips, things like a checked bag or Wi-Fi to work in-flight are practically required.

“Ancillaries are small costs that do not impact the budget.”

They can add up fast, especially on longer trips or for frequent travelers. For example, bags, seats, and Wi-Fi on multiple legs can rival the base ticket price.

“They are too messy to track separately.”

Modern travel and expense tools can break out and categorize ancillaries automatically so that you can understand where your money is going.

Why Ancillary Services Matter

Companies that actively manage ancillary services usually see lower total trip costs and fewer billing surprises. Here is why:

Total Cost Accuracy

Base fares and room rates do not tell the whole story. Ancillaries like bags, Wi-Fi, or seat fees can add 10–50 percent or more to the real cost of a trip. Knowing this lets you budget properly.

Policy Control and Fairness

Clear rules about which ancillaries are allowed help you:

Treat travelers fairly and consistently
Avoid disagreements over whether a purchase is reimbursable

Productivity and Traveler Satisfaction

Some ancillaries—like Wi-Fi or extra legroom on long flights—can improve employee comfort and productivity. Managed well, they are an investment, not waste.

Negotiation and Supplier Strategy

Ancillary spending is often negotiable in corporate deals. If you know what your travelers buy most, you can:

Negotiate bundles that include common ancillaries
Choose partners whose fare structure matches your policy

Better Expense Reporting and Analytics

Separating ancillaries from base fares in your expense data lets you:

See exactly how much you spend on bags, upgrades, and more
Tune policy where costs are rising the fastest

Platforms like Navan can surface these insights automatically.

How Ancillary Services Work in Practice

How Ancillaries Are Offered and Sold

During booking When travelers book flights or hotels:
After booking, pre-trip Providers send emails or app alerts with offers such as:
At check-in or at the gate or front desk Last-minute offers include:
During the journey Onboard and on-site purchases include:

Each of these touchpoints is a chance for extra spending that may or may not be aligned with your travel policy.

Comparison: Manual vs. Automated Travel and Expense Management

Feature / Stage	Traditional (Manual) Approach	Modern (Automated) Approach
Booking & Selection	Chaotic & unstructured: Travelers book on public sites without guidance or cost limits.	Policy-aware: Only allowed ancillaries are visible; out-of-policy items are hidden or require approval.
Cost Visibility	Hidden costs: Total prices are often unknown until after the purchase is made.	Upfront pricing: Total cost (base fare + ancillaries) is visible at the point of choice.
Policy Enforcement	Inconsistent: Approvers guess what is "reasonable," leading to random approvals or rejections.	Guardrails & defaults: Rules are pre-set based on trip duration, role, or flight length (e.g., Wi-Fi for long-haul).
Data Capture	Manual & vague: Receipts show "lumped" totals or multiple lines that are difficult to code.	Automatic sync: Card and booking data flow directly into the system with no manual receipt splitting.
Categorization	Generic: Most extras are coded under "Airfare" or "Hotel," hiding the actual breakdown.	Granular: Specific tags (e.g., "Baggage Fee," "Seat Fee") are automatically applied to line items.
Reporting & Insights	Poor visibility: Finance cannot see how much is spent on extras vs. base fares.	Deep analytics: Managers can see top spending categories, outliers, and frequent policy violators.
Strategic Impact	Reactive: Decisions are based on guesswork and frustration.	Proactive: Data allows for policy tuning and better negotiation with travel vendors.

The shift from a manual to an automated system (like Navan) moves a company from reactive damage control, where managers must manually audit vague receipts, to proactive management, where compliance is built into the booking process itself.

Ancillary Services in Practice

Scenario A: Airline Ancillaries on a Short Business Trip

A traveler books a two-day domestic trip:

Base fare: $200
Adds: seat selection ($30), carry-on upgrade ($25), onboard Wi-Fi ($15)
Total: $270

If your policy allows Wi-Fi for work but not seat selection on short flights, your platform can approve Wi-Fi automatically and flag or block the seat fee.

Scenario B: Hotel Ancillaries at a Conference

A traveler stays for three nights:

Room rate: $180 per night
Adds: parking ($30 per night), breakfast ($25 per day), late checkout ($40)

These ancillaries might be allowed for conference trips (breakfast and parking) but restricted or require approval for the late-checkout fee.

Scenario C: Corporate-Negotiated Bundles

Your company negotiates with a major airline so that fares include one checked bag and advanced seat selection for all employees. In Navan, this appears at the time of booking as “Corporate Fare (bag and seat included)” versus “Public Fare (bags extra).” Even if the base public fare looks lower, the negotiated fare may be cheaper when ancillaries are factored in.

Common Challenges and Solutions

Challenge 1: Underestimating trip cost because ancillaries are not considered.
This happens when you budget based only on base fares and room rates. Solution: Track ancillaries separately from base costs. Use tools that show the total expected cost, including common ancillaries, at booking.

Challenge 1: Underestimating trip cost because ancillaries are not considered.

This happens when you budget based only on base fares and room rates.

Solution:

Track ancillaries separately from base costs.

Use tools that show the total expected cost, including common ancillaries, at booking.

Challenge 2: Inconsistent approval of extras.
Some managers approve seat upgrades or Wi-Fi; others do not. Solution: Define clear policy rules for what is allowed always, sometimes, or never. Configure your booking and expense platform to enforce these rules automatically.

Challenge 2: Inconsistent approval of extras.

Some managers approve seat upgrades or Wi-Fi; others do not.

Solution:

Define clear policy rules for what is allowed always, sometimes, or never.

Configure your booking and expense platform to enforce these rules automatically.

Challenge 3: Hard-to-read receipts and unclear coding.
Receipts may use airline codes or vague labels for ancillaries. Solution: Use an expense system that recognizes common codes and maps them to friendly categories. Train employees on how to tag and describe ancillary purchases clearly.

Challenge 3: Hard-to-read receipts and unclear coding.

Receipts may use airline codes or vague labels for ancillaries.

Solution:

Use an expense system that recognizes common codes and maps them to friendly categories.

Train employees on how to tag and describe ancillary purchases clearly.

Challenge 4: Traveler frustration when ancillaries are blocked.
If travelers feel you block everything, they may go outside your system or book on their own. Solution: Allow reasonable ancillaries that improve safety and productivity—bags, Wi-Fi, or extra legroom on long flights. Communicate the “why” behind rules, and use tools like Navan to present compliant options that still feel flexible.

Challenge 4: Traveler frustration when ancillaries are blocked.

If travelers feel you block everything, they may go outside your system or book on their own.

Solution:

Allow reasonable ancillaries that improve safety and productivity—bags, Wi-Fi, or extra legroom on long flights.

Communicate the “why” behind rules, and use tools like Navan to present compliant options that still feel flexible.

Challenge 5: Negotiating without ancillary data.
You cannot negotiate what you cannot see. Solution: Use reporting to understand your top ancillary spends by airline, hotel, and route. Bring that data into vendor discussions to negotiate for included bags, seats, or Wi-Fi.

Challenge 5: Negotiating without ancillary data.

You cannot negotiate what you cannot see.

Solution:

Use reporting to understand your top ancillary spends by airline, hotel, and route.

Bring that data into vendor discussions to negotiate for included bags, seats, or Wi-Fi.

Aspect	Ancillary Services	Base Fare or Rate	Fees and Taxes
What It Is	Optional add-ons, like bags, seats, or Wi-Fi	The core price of a ticket, room, or rental	Mandatory charges added by providers or the government
Control Level	Usually can be chosen or skipped	Required if you travel or stay	Often unavoidable (tax) or tightly controlled
Visibility at Search	Sometimes hidden or added later	Shown as the main price in a search	Often shown as “+ taxes and fees”
Policy Impact	A major area for savings and comfort tuning	Drives basic budget levels	Mostly a compliance and forecasting issue

You would focus on ancillary services when:	You would focus on the base fare or rate when:	You would focus on fees and taxes when:
Fine-tuning comfort versus cost in your travel program Deciding whether to allow extras like Wi-Fi or priority boarding Negotiating bundles that include certain add-ons	Comparing core fares between routes or carriers Setting high-level travel budgets	Understanding unavoidable regulatory costs Comparing cost differences between countries or regions

You would focus on ancillary services when:

You would focus on the base fare or rate when:

You would focus on fees and taxes when:

Fine-tuning comfort versus cost in your travel program

Deciding whether to allow extras like Wi-Fi or priority boarding

Negotiating bundles that include certain add-ons

Comparing core fares between routes or carriers

Setting high-level travel budgets

Understanding unavoidable regulatory costs

Comparing cost differences between countries or regions

Understanding ancillary services is easier when you know these related concepts:

Unbundled Pricing: A pricing model where providers split services into separate items instead of one all-in price. Ancillary services are the pieces that get unbundled from the base fare or rate.
Fare Class or Booking Class: A code that defines ticket rules, flexibility, and included services. Some fare classes include ancillaries like a checked bag or seat selection, while cheaper classes do not.
Travel Policy: Your company’s rules for what travelers can book and what is reimbursable. A good policy specifies which ancillaries—bags, Wi-Fi, or seat upgrades—are allowed in which situations.
Total Trip Cost: The full cost of a trip, including base fares, hotel rates, ancillaries, fees, and taxes. Ancillary services are a key part of this total and must be considered for accurate budgeting.
Low-Cost Carrier (LCC): An airline that typically offers very low base fares and relies heavily on ancillary revenue. On these carriers, ancillaries can easily exceed the base ticket price.
Fare Bundle or Branded Fare: A packaged offer that includes certain ancillaries, like a bag and seat selection, for a single price. Bundles can simplify both traveler choices and expense reporting.
Expense Management Platform: Software that handles the submission, approval, and reporting of expenses. Platforms like Navan Expense can automatically recognize and categorize ancillary services on receipts and card feeds.