Corporate travel bookings alone increased in the first quarter of 2022 over the first half of 2021. Understandably, along with this trend comes an urgent awareness of corporate travel expenses.
The past few years have shown us the benefits of face-to-face meetings, and thus the importance of corporate travel. 86% of those asked said they believed travel was necessary for them to succeed in their jobs—be it acquiring clients or even managing teams in widely dispersed locations. As such, companies have moved quickly to put their teams back on the road in order to maintain their competitive edge.
In this article, we will look into travel cost reduction strategies and effective ways to get your whole team on board to cut back on corporate travel expenses overall.
How to reduce business travel costs for your organisation
While business travel can be expensive, especially if you have lots of employees flying to different locations at different times, companies can learn how to reduce business travel costs and manage corporate travel expenses without compromising on safety or quality.
1. Get access to cheaper and better flight inventory
Be mindful when selecting the airline tickets you purchase. You could save a lot by simply being flexible with your travel dates and airline choice.
Other travel cost reduction strategies include booking in advance, booking at the last minute, and choosing low-cost airlines—something you may miss out on if you’re still locked into outdated systems.
2. Tighten up your company’s travel policy
There are several factors to take into account when establishing a company travel policy, from flight arrangements to food allowances and handling charges. That means there’s a lot that can slip through the net.
Examine your current corporate travel policy carefully and consider if it is comprehensive enough to cover all corporate travel expenses within your company. Get the basics in order, including a proper approvals procedure, rules for reservations and bookings, and policies for on-site spending, so that business travellers can make decisions that don’t incur extra expenses.
3. Have a pre-trip approval procedure
Having an approval procedure in place for each booking is one of the simplest methods in how to reduce business travel costs. Making it clear who must approve travel will help you avoid the issue of having to cancel trips after they have been booked, leading to unnecessary expenses.
If you partner with a travel management company, use the online booking tool provided to the fullest extent possible. This should allow you to have more control over travel arrangements.
4. Monitor the latest travel spending trends
Similar to how a customer wanting to cut costs on their family budget has to know which expenses are eating up their cash, a company needs to know which aspects of business travel are more important than others.
The following are some questions you might want to ask:
- Who is spending the most money among your travelling employees?
- What can be done to lower the costs of airport transit, WiFi, etc.?
- What adjustments are necessary for the team to stay within the company’s annual budget?
5. Set a reasonable food and transport budget
Giving employees control over their expenditure on food and transport may end up reducing overspending. Employees can decide how much to spend on breakfast, lunch, and dinner by setting the meal expenses as a daily total allowance.
There will always be exceptions, so save that five-star dining establishment for your most important client appointments. You should encourage your employees to select the most economical mode of transportation, taking trip times into account. This includes using personal vehicles.
ARE YOU USING A TRAVEL MANAGEMENT COMPANY TO ITS FULLEST?
A travel management company (TMC) is an independent intermediary that coordinates an individual, business, or organisation’s travel needs, saving them time and money. In view of the importance of corporate travel, they can be an indispensable partner for your organisation.
In addition to making reservations for flights or hotels, TMCs often provide services including aircraft charters, use of airport lounges, parking, transfers, international train tickets, car hire, chauffeurs, foreign currency exchange, group travels, and arranging passports and visas. In short, a one-stop shop for all your needs related to business travel.
Among the main objectives of TMCs, often known as business travel agents, are to maximise corporate travel expenses for their clients while maintaining passenger safety. They accomplish this by working with each client organisation to develop and implement travel policies that match their needs.
HOW DOES A TMC BENEFIT YOUR TRAVEL COST REDUCTION STRATEGIES?
1. Increased planning efficiency
Besides the preparation of a trip, all of the supporting logistics also require time and effort. It’s important to manage the trip data and reconcile necessary travel expenses.It is normal for travel plans to alter due to crises or other unanticipated situations, and getting used to them can be difficult. This is precisely where a travel management company can help, saving both time and money for businesses.
They have access to the most recent software, giving businesses the resources they require while providing customer service to handle any unforeseen and necessary changes effectively.
2. Negotiated discounts
Airlines, hotels, and car rental agencies are all in contact with travel management businesses. They are familiar with the caller or email recipient on the other end. And that person is aware that the travel management company generates a sizable amount of revenue each year.
Thanks to this arrangement, TMCs are eligible for savings on every flight, hotel stay, and car rental. In fact, a corporation may often save at least 10% on its travel and entertainment expenses with the right TMC.
3. Improved travel management
When employees do not understand the various travel policies from their respective companies, it can cause some major issues. They may be unsure of the circumstances in which they will need permission to make specific reservations or purchases.
They can even fail to remember which hotels, rental agencies, or airlines the company has agreements with, or be unaware of the pricing point at which they should start looking at different hotels or airlines.
All these problems can be resolved with the help of a TMC. TMCs are committed to adhering to your company’s policies at all times and working on how to reduce business travel costs for you.
4. Maximised employee effectiveness
Companies employ people because they require them to do a task. They require them in order to close a deal, protect a trustworthy client, or do some other important work. They don’t hire them to book hotels and flights for hours on end.
As much as companies value the importance of corporate travel, it takes too long for the average employee to compare pricing, make reservations, and work out an itinerary. Being required to follow the company’s travel policy might be difficult and stressful.
This is another area where a TMC adds value. They take on this duty so that your employees can perform the tasks for which they were hired to do.
5. Employee satisfaction and retention
Every step of travelling, including planning the trip and booking a hotel room can be stressful. A TMC assists in easing all the tension brought on by travel. They set up an easy-to-use automated platform so that businesses can easily start making travel arrangements. Then, they provide a committed specialist to handle the itinerary individually from start to finish.
As a result, you won’t be speaking to a machine but rather a live person whose sole purpose is to assist you as much as possible during your corporate travel experience. It is this type of personal touch that maintains employee satisfaction and loyalty to their employers.
6. Detailed data reporting
Every business needs data, documentation, and information. It helps them analyse and improve. It might be challenging, if not impossible, to compile all of this data, paperwork, and information when travel planning is spread out across multiple employees.
There’s also a chance employees might misplace their itinerary emails and fail to request for receipts. With the help of a TMC, this issue is solved. Human resources and finance no longer have to spend their working hours chasing down employees to get what they need.
Additionally, with a TMC, the company receives frequent reports on the corporate travel expenses of each and every employee. They are all in one location, updated automatically, and ever accessible.
7. Enhanced flexibility in arrangements
Plans for any given trip continually change. Emergencies arise, and meetings get postponed. When an employee is in charge of making their own travel arrangements, they have to call and speak with random people, from airline staff to vehicle rental receptionists.
The most typical reaction to their requests for change is “no,” “that is not possible,” or “that will cost you more.” This not only eats up time and aggravates employees, but it can also wind up costing the company a lot more money.
TMCs find solutions to issues like these. The dedicated travel manager can immediately arrange it with just a brief request from an employee. Without harming the company’s bottom line, they quickly create solutions that fit the needs of your workforce.
OPTIMISE YOUR CORPORATE TRAVEL EXPENSES WITH HOLIDAY TOURS
How to save money while travelling for work? This is a question that companies come up against constantly—and one which we at Holiday Tours deal with on a daily basis. We easily customise or modify preferred hotels, travel policies, advance purchase requirements, and more. A quick and efficient partner for all your corporate travel needs.
BOOST YOUR TRAVEL COST REDUCTION STRATEGIES.
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