With the cost of business travel growing up every year, managing travel costs within a set budget can be a challenge. However, there are a number of ways that you can address this, maintaining a positive experience for your employees while sticking to the financial budgets that have been set. This article delves into the complexities of managing travel expenses and explores practical strategies for office managers to find cost-effective solutions for transportation, accommodation, and other travel-related expenses.
Transportation: Maximize efficiency, minimize costs
Transportation costs really do add up, often taking up a significant chunk of your business travel budget. But there are actually some simple fixes that can help you manage these expenses. Here are a few strategies to try:
- Plan ahead: Encourage employees to plan ahead, so that you can take advantage of the best rates. To make sure employees stick to this, you can also implement some guidelines at a policy level, ensuring that employees don't book travel without manager approval if the trip is less than a week away.
- Negotiate deals: Securing corporate discounts, especially if you have offices in locations that employees travel to regularly, can also help reduce your costs. When you're negotiating with airlines, car services or hotels, be sure to provide as much detail as you can about your current and projected travel requirements, and the size of your travel spend over the course of the year.
- Avoid air travel: Sometimes it's unavoidable, but where it's possible, look at alternative transport options that can both help you save money, but also reduce your carbon emissions. When booked in advance, the train can actually reduce your travel costs, and maximize efficient working time for your employees. It's can also just be a more pleasant way to travel!
- Stay for longer: Incentivizing employees to stay 1-2 days longer can help avoid them having to return to the same location more than they need to. It also has the benefit of reducing emissions! With the right planning and execution, you'll soon see the average number of trips decrease, and hopefully boost productivity.
Accommodation: Balance comfort and cost
It can be hard to get the right balance when it comes to accommodation because you need to consider your budget, but also the wishes of employees who understandably want the best experience possible when they're traveling for work. Here's a few things to consider:
- Set price limits: Putting caps on spending in your corporate travel policy is an absolute must as the cost of accommodation can really spiral if left unchecked. Employees should still have the flexibility to choose where they stay, as long as it's within the budget allowance, as well as be able to use their rewards programs for any upgrades provided it doesn't cost the business more.
- Look at alternative options: More than half of corporates are using serviced apartments compared to a year ago, according to BTN. This is partly due to cost, but also due to a preference for a more "home from home" environment for longer work trips.
- Negotiate deals with hotels: Look at hotel chain groups that have the biggest international coverage and the widest selection of price points, and start negotiating! Check out our Guide to Choosing a Sustainable Hotel for more tips on what to evaluate outside of just cost.
Travel Policies: Establish Clear Guidelines
Setting up a clear and comprehensive travel policy is key to managing and reducing your travel costs. These policies should outline what you're allowed to expense, what you're not and set realistic expectations of how employees should approach spending when they're traveling for work. Here are a few things that should be in your policy:
- Per diem allowance for meals and other expenses
- Guidance for expense reporting and reimbursement
- Guidance on hotel standards and per night costs
- Advice on transportation options, including safety advice
- Suggestions for how to reduce your transport emissions
- Details of duty of care and medical insurance
Travel Tech: Find the right tool for your business
Once you’ve got all the foundations in place such as a travel policy, you’re ready to start scanning the market for the right tools. A good travel management system can save you a lot of time and help you reduce costs, but it's all about finding the right fit for your business needs. Here are some of the key features to look for, if you're looking to give your employees more independence, but still want to keep the checks and balances to manage costs:
- Flexible, self service booking features: By giving your employees an all-inclusive tool to book and amend their own travel arrangements, you can give them the flexibility they need to manage their own travel, while still keeping a tight rein on spending and approvals.
- All the travel options, at the best rates: Your time also costs money, so by having the widest selection of travel options at the best price points, you can feel comfortable that you're getting the best deals in one place without having to constantly shop around, which can be incredibly time consuming.
- First-class customer service: In today’s competitive market, you shouldn’t have to settle for second-rate customer service from call centers. A good travel management system should have quality customer service from trained professionals, available 24/7.
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Instant refunds: Having to wait 6+ months for refunds can really put a dent in your company’s cash flow, especially if you’re spending a lot of money on travel. Look for a system that refunds you immediately, or at the least within 7 working days of when you make the booking.
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Expense integration: Being handed a fistful of receipts with no context is a thing of the past. Sophisticated expense management tools are a key feature of any good travel management tool, and can help you keep a tighter control on spending as it happens, instead of 3 months after the trip has ended.
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In the realm of business travel today, managing costs requires a strategic and multifaceted approach, and office managers play a pivotal role in that. With the right planning, the latest travel management tools and clear travel policies in place, you can more easily manage travel costs within a set budget, without compromising the quality of the business travel experience.
