Egor Karpovich, CEO of Travel Code. We are a corporate travel management platform that helps businesses save on every trip.
Business travel remains as popular as it’s ever been. Professionals across all different industries continue to hit the road to form partnerships, attend industry events, manage operations at branch offices and on and on. The reasons for corporate travel are many, but the desire to keep the costs of that travel under control is the same across the board: All businesses want to minimize the expenses they incur in their travel program while maximizing the impact that the program has on operations.
Let’s dive into some of the most effective ways that companies can keep their travel costs under control without missing out on any of the opportunities that exist on the road:
Calculate the real cost.
It’s hard to save money on travel if you don’t know exactly what you are spending. That might sound obvious, but many organizations don’t have a clear picture of their current travel costs and where dollars might be getting wasted.
Some expenses are easy to track. Flights and hotels, for example. Others tend to fall through the cracks, such as meals while on the road and other incidentals. Sure, they are accounted for, but is there a specific system for how they are managed and how that spending is approved? Taking time to identify where costs have crept up in recent years will give you a good perspective on the situation and help you start to make improvements.
Craft a clear—and flexible—travel policy.
The heart of a healthy corporate travel system is a clear and well-defined employee travel policy. If you don’t have such a policy in place, or if it hasn’t been updated for a while, now is the time.
Be sure to address the following in your policy:
• Approved travel booking platforms
• Preferred airlines and hotels
• Spending limits by category (such as daily meal allowances)
• Booking timelines
• Reimbursement procedures
It’s a good practice to include your company’s frequent travelers in the process of crafting your policy. Those individuals know what the realities are out on the road and can help you create something that actually works in the real world.
Take advantage of early booking and bulk discounts.
Last-minute travel is painfully expensive. In my experience, when you can plan ahead and book early, you may be able to save up to 20%—or more. This won’t always be possible in every situation, but early booking should be a standard practice for most trips.
With bulk discounts, you should also be able to get a notable reduction in the nightly rate you pay at a hotel when you reserve a large number of rooms. That’s particularly true if you bring business back to that hotel year after year.
Select cost-effective destinations.
Sometimes, you won’t have much choice in where you travel. For example, an industry conference may be scheduled in a given city, and that’s where you have to go. In other cases, however, you can choose strategically to bring the costs down as compared to traveling to more expensive, larger cities. If you are setting up a regional meetup for your corporation, for example, picking a mid-sized city as opposed to a huge metropolis like New York or Chicago could lead to meaningful savings.
Remember that economy beats luxury in most cases.
Using economy seating on flights and booking mid-level hotels is almost always the way to go for business travel. It might look impressive to reserve first-class tickets or secure four-star hotels, but the additional cost of these travel comforts doesn’t really add anything to your business.
With the possible exception of travel that is being used to impress an important client or prospective investor, you’ll be better off shopping in the middle of the market for transportation and accommodations. Your people will still be comfortable and have everything they need to do a great job.
Optimize itineraries for comfort.
Speaking of being comfortable, one way to provide employees with a great travel experience is by booking smart itineraries. This will go a lot further in employee satisfaction than paying the premium for first-class seats, for example.
A smart itinerary is one that avoids lengthy layovers or long segments of time-consuming ground travel. Taking the time to book flights that get people where they need to be efficiently will make them happy and can even save you some money along the way.
Consider travel insurance.
Things don’t always go perfectly when it comes to travel. The real world can be messy, and issues will occasionally come up that are out of your control.
Instead of putting the money you spend on travel at risk, it can be a smart idea to invest in travel insurance. This is an affordable way to have some protection and make sure a large expense isn’t completely wasted when something comes up that changes your plans at a moment’s notice.
Collect feedback and continuously improve.
As much as you would like to, you aren’t going to nail your travel policy with the first draft. Don’t look at your policy as a finished product so much as a living document that can—and should—be updated regularly.
Pay attention to your travel program to see what is working and what isn’t. Consistently look for places to save money and improve. Even businesses that have been sending employees on trips for decades still have areas where they can get better.
Over time, your company’s travel policy should adapt to changing needs, new destinations and shifting costs. Stay flexible to keep your company competitive in the market while keeping your employees happy at the same time.
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