Understand the new business travel landscape
In April 2022, business flight bookings exceeded 2019 levels for the first time since the pandemic according to the Mastercard Economics Institute. If trends continue at this pace, an estimated 1.5 billion more passengers globally will fly in 2022 compared to 2021.
Given this healthy return to business travel and the costs it incurs for business, it will come as no surprise that organisations of all sizes are reviewing their travel budgets and booking strategies to maximise their bottom line.
How do you reduce business travel costs?
A great place to start is by viewing business travel as an investment in your organisation’s future competitiveness rather than solely as a cost line. It’s an important change in mindset but it may help to know that you can travel and engage face-to-face and STILL reduce costs. Here are just a few suggestions:
- Travel policy compliance
A well-designed travel policy can deliver significant savings, so look at:
- Consolidating your business travel spend to a few preferred supplier partnerships
- Defining optimum booking behaviours based on your organisation’s unique travel needs
- Encourage product choices that align with traveller experience objectives
Once your policy is set, the key to achieving efficiencies, cost savings and safety is through maximising compliance and ensure that your travellers are not booking anything that’s out of policy.
- Online booking tools and travel approvals
If you don’t already use an onling booking tool (OBT), you may be losing out on savings opportunities. You can integgrate your travel policy into an OBT and this helps reduce non-compliant bookings by only displaying travel content from preferred suppliers or those that meet acceptable rate caps. Some OBTs will also have an integrated pre-trip approval tool to help minimise spending on unapproved travel activity.
- Booking behaviour analysis
No matter how small your business travel budget is, it is important to understand how to make the most of it with best practice booking behaviours. Ask yourself:
- Are travel dates flexible? Do you know how to dentify the cheapest time to travel?
- Are travellers buying expensive flexible/refundable airfares unnecessarily? Booking cheaper/more restrictive airfares can result in significant savings.
- Is the trip necessary? How productive will your traveller be? Have they scheduled their day with meetings or events to maximise their time away? Did they book their travel in advance to secure the lowest rates?
- Unused travel credits
Travel credits are a simple way to use pre-spent travel budget for future flights. At the peak of the pandemic, organisations were forced to cancel large volumes of flights leaving high volumes of unused travel credits so it’s worth finding out if your company is due any – don’t forget that may also include former employees and some airlines will let you change names and re-assign credits to other travellers.
- Advanced purchases
Business travel can be unpredictable, so we always recommend that you book in advance to secure the best fare and maximum product choice. This goes for domestic and international travel, as post-COVID travel demand may outweigh schedules and servicing.
- Partner with a travel management company
Partnering with a corporate travel management company (TMC) like CTM, where I work, will help you drive savings and efficiencies. You’ll benefit from an expert view over everything from supplier negotiations to traveller safety, as well as access to huge buying power that can result in savings. A TMC will allocate you a dedicated account manager to make sure your travel arrangements meet all your business needs, and factor in efficiency, safety, schedules and budget.
A TMC can also analyse and review your business’s travel behaviours and spending patterns to identify trends and use that insight to negotiate discounts or add-ons through preferred airline, hotel and car rental suppliers.