400 million professionals in the United States alone go on business trips every year. The number goes up even more when you count other countries and unaccounted trips. No wonder corporate business travel is a huge industry, which will be a $1.7 trillion global market by 2022.
If you are trying to save money on business travel, there are multiple things you can do to reach your goal.
From having a travel plan to tracking expenses, the list of things to do is long. That does not mean you should not pay attention to it. Proper business travel management will save your company a lot of money in the long run.
We have discussed some easy ways to save money on corporate travel. Effectively using these strategies will help you stay within your business travel budget and manage finances more effectively.
5 Tips How to Save Money on your Business Travel
Like any other aspect of financial management, business travel expenses demand special attention. If you leave it as an afterthought, your travel budget would be all over the place.
With our five tips to save money on business travel, you will learn about different ways to save resources on a corporate business trip. Remember that these are general guidelines, and you would need to tailor them to your specific needs and wants.
1. Be Flexible in Your Options
Not being flexible to accommodate different situations is the first mistake that many businesses make. Often companies have a specific hotel chain or transport company that they stick to.
While it might be a good move at times, sometimes it can cost you more on your business travel. The degree of excess expenses varies from one situation to another.
The best way to deal with it is by having access to multiple service providers. By staying updated about price drops and special offers, you can save a lot of money over an extended period of time. This rule applies to hotels primarily but remains the same with other service providers like transport and food.
Many hotel chains will also offer loyalty discounts to long-term clients. If your requirements allow you to partner with a particular hotel chain, it can cut business travel expenses significantly. Often the location of your stay will also determine its price. Stays near or at the city center usually have a higher price than those near the airport or the outskirts. Being open to these options will help you manage business travel expenses better.
Staying updated might not be feasible if you do not have a dedicated team for business travel management. Outsourcing the work to a corporate travel agency like TravelPerk can help you save both time and money. On top of that, you do not need to worry about human errors and slip-ups.
2. Encourage Employees to Travel Economically
Business travel expenses can easily go out of hand. While there are some areas where you cannot compromise, others are much more flexible. When you encourage your employees to travel economically, the little savings will add up to a substantial amount in no time.
For instance, simply swapping private transport for public transport will save you quite a few bucks, more so when the trip includes heavy intra-city commutes. Even when you cannot switch to public travel completely, you can at least use it in some cases. Depending on the place and situation, public transport (like the subway) can be faster than a cab or a self-driven car.
Another area where you can save a lot of money is flight tickets. Business-class tickets cost much more than economy-class tickets. If it is not a necessity, encourage your employees to travel economy-class. It makes more sense when multiple people are traveling at the same time.
Traveling economically is more of a mindset than a strategy. You cannot give instructions on every method that can save money on business travel. Rather, you should try to inculcate this mindset in your employees.
Being transparent and open helps in the process. If you can make your employees realize that lowering business travel expenses would help the company and everyone related to it, they will understand its importance. Bringing this cultural shift to your workplace can be a bit of a challenge, but will reap huge benefits in the long run.
3. Formulate Clear Business Travel Policies
When you have a clear business travel policy for employees, it makes it much easier to not go overboard with expenses.
A business travel policy is a set of rules and principles that all employees have to follow on business trips. Rather than looking at it as a set of rules, think of it as a general framework with specific pointers.
You need to be careful while formulating business travel policies. If they are too stringent and unrealistic, it would make business trips inefficient and unfruitful. On the other hand, a very loose framework will not do much in terms of saving you money.
A good travel policy takes into account the real problems and needs of travel and then capitalizes on the areas where we can save money.
An effective business travel policy needs some degree of automation to work perfectly. A corporate travel management solution gives you these features where you can set a policy and forget about it. However, it does not mean that you stop revising it from time to time.
Business trips would have different needs depending on their nature, and you cannot impose the policies of one on the other. Being flexible with the policies is very important to save money efficiently.
Travel policies are a great way of saving money without spending a lot of time behind each business trip separately. The framework would completely depend on your needs, and no two companies would have the exact same needs and obligations. Identify where you can save money, and work on it in your travel policy.
4. Schedule and Plan Your Business Trips
If you are planning every aspect of your business but not your business travels, you know you are making a mistake. Planning your business travel is different from setting up business travel policies. In the latter, you are creating a general framework for your employees to follow. With planning, however, you also add the aspect of scheduling.
Scheduling your business trips can save you a lot of money, and in ways you would not think of normally. For example, traveling during the holiday season would inevitably cost you more. Similarly, different places have different seasons when tourists flock in. Avoiding these times for business travels will be a great way of saving some extra money on travel.
When you schedule and plan your business travels, keep in mind all your other commitments.
Apart from saving money, it also helps you avoid last-minute rush and hasty decisions. It is better to schedule business trips keeping in mind how and when your employees would be more efficient in business trips. If you frequently travel for business purposes, you should separate time or date blocks for travel and other blocks when you do not travel at all.
5. Keep a Track of All Expenses
Our last tip is perhaps the most obvious, yet the most difficult. Every successful finance manager knows the importance of tracking expenses. It shows exactly how much you spend and where.
Besides that, you can find patterns and identify problems when you keep meticulous track of all expenses. However, doing so for business travel is easier said than done. With so many small transactions, keeping a tab of everything manually can be taxing.
Corporate business travel management solutions can help greatly with business travel expense tracking. Since most processes are automated in these solutions, you get a real-time, accurate update of all the expenses.
Automation also makes it easy to maintain records of even the smallest transaction. With a corporate travel management solution, all your expense tracking work is taken care of.
Tracking expenses will help you in many ways apart from saving money.
For example, this data will be of great help when you formulate your travel policies. Similarly, showing your employees numbers and figures will help them realize the extent of travel expenses. That will make it easier for you to inculcate a budget travel mindset.
While keeping a tab of expenses and spendings, it is very important to not overlook any aspect. Even if it’s a seemingly small amount, they would quickly add up to a big number. It’s also a good practice to keep a tab of small transactions since it’ll keep you in the habit of tracking and dealing with business trip expenses.
When it comes to corporate business travel management, we often forget this basic precept. As you could see from our list of ideas and tips, saving money on business travel need not be difficult. If you have a solid framework and implement good practices, you can easily cut business travel expenses.