Every dollar in your corporate budget matters. Here are ways to save on business travel.
Travel expenses are part of the cost of doing business. Your annual travel spend goes beyond air, car and hotels expenses — represents business development trips, meetings with existing clients, attendance and presentations at industry events plus more.
But there are always ways to reduce travel spend without affecting the business purpose behind each individual trip. And, when you reduce travel expenses, you boost your company’s return on investment in business travel.
Looking for good places to start in reducing travel spend? Here are 10 ideas you can explore.
1. Create an Effective Travel Policy
If your company asks team members to travel, you must have an effective travel policy in place. If you don’t have a travel policy that works, or if you don’t have one at all, make that your No. 1 priority.
Creating an effective travel policy takes time and participation from people across your organization. We recently wrote about how to create the perfect business travel policy for your unique business and its team members. You can use that post or another resource to get the process started. Just know that, once you have an effective travel policy in place, you’ll find that travel spend naturally decreases.
2. Hold Employees to the Travel Policy
This is the most important thing you can do to ensure your travel policy is successful: hold employees to it. A travel policy is nothing without enforcement.
Of course, as a travel manager, you don’t want to morph into the travel police. So try proactive strategies for educating team members about the policy and encouraging them to comply with it.
For example, make sure your travel policy is readable and accessible. Hold annual or bi-annual lunch-and-learns that describe, not just the policy, but also the ways that it benefits travelers. You can even find ways to incentivize team members who help reduce travel expenses.
For more ideas on how to hold employees to your travel policy, check out our common sense tips to increase business travel compliance.
3. Negotiate Corporate Rates
Because your business regularly sends team members on the road, it holds a lot of power and leverage to negotiate corporate rates with airlines, hotels, rental cars and other companies. In short, vendors want to earn your business — and they’re often willing to provide reduced rates and special deals to secure it. You might even be able to negotiate status for your travelers, which can help accrue points and rewards — which then can be put toward reducing travel spend.
So make sure your travelers are using pre-negotiated corporate rates rather than booking as individuals. Corporate rates should be one of the fastest and easiest ways to reduce travel expenses.
4. Use a Consistent Booking Platform
Identifying and implementing the right business travel technologies is a great way to reduce travel spend. For example, any company that relies on regular business travel should have a single, consistent booking platform for all employees to use.
Using a consistent booking platform unlocks all sorts of benefits. A booking platform can serve pre-negotiated corporate rates to users, and it can also be customized for compliance with your travel policy. Find the right booking platform, and you’ll discover that a lot of the other ways to reduce travel spend fall into place.
5. Same-Day Trips
Looking for hidden ways to reduce travel expenses? Consider same-day trips. This isn’t always possible, especially when a trip requires a connection or covers multiple time zones.
But sometimes same-day trips make a lot more sense than spending money on a hotel. For example, it’s easy to get from Dallas to Chicago for an after-lunch meeting and then back to Dallas afterward. Non-stop flight options are plentiful in and out of multiple airports in both cities, and you never leave the Central time zone.
6. Require Authorization for Last-Minute Travel
Last-minute travel is a budget killer. Options are limited, flights cost more, hotel rooms are hard to find, etc. Last-minute travel is often essential, but it’s not always necessary. How can a travel manager ensure that last-minute trips materialize only in the most vital situations?
Start by requiring authorization for last-minute trips. If your company is going to pay the premium that often comes with last-minute travel, the team member taking the trip should be able to make a compelling case for why the trip is needed.
You might be wondering: What constitutes last-minute travel? As a rule of thumb, travel should be booked at least 14 days in advance of departure. Anything after that is considered last minute.
7. Adjust Per Diems by Location
Has your company implemented dynamic per diems? The concept is fairly simple: The average meal in New York City costs a lot more than the average meal in Grand Rapids. So consider different per diem tiers — a top tier for expensive cities like San Francisco, a middle tier for locations like Phoenix and then a bottom tier for smaller, less expensive destinations like Birmingham.
8. Test Out Virtual Meetings
At JTB Business Travel, we have always believed that the best way to save money on travel is not to travel at all. And, today, there are more alternatives to business travel than ever before.
Does your company have the tools and technology to host virtual meetings? If so, make sure team members are exploring them as alternatives to business travel. If not, consider looking at different options and identifying virtual meeting technologies that might work for your business.
9. Explore Public Transportation
The easiest thing to do when you arrive in a city is to hail a cab or summon an Uber. But public transportation is almost always less expensive — and it’s sometimes even more convenient.
For example, Chicago’s O’Hare International is about 18 miles from the heart of the city. Get in a cab, and you might pay $70 to sit in traffic for an hour. But, hop on the Blue Line, and you can cover the same distance in about the same amount of time — for a fraction of the cost.
Public transportation doesn’t always make sense, but it’s an option that’s worth exploring in many cities and situations.
10. Embrace the ‘New’ Providers
Most seasoned business travelers have their preferred vendors. For example, a certain traveler might fly American, rent from Avis and stay with Marriott. And there’s nothing wrong with that — until it starts hurting your travel spend.
Make sure that all of your travelers are exploring the “new” providers when possible. Low-cost airlines are far more common today than they were just 20 years ago, so encourage travelers to at least consider low-cost carriers like Spirit. Uber and Lyft might serve as affordable alternatives to renting a car. And HomeAway and Airbnb could help save money over a hotel in some locations.
These new, alternative providers won’t always make sense, and they don’t always fit into a company’s travel policy. But, in many cases, they are great ways to help reduce travel spend.
Bonus: Get the Help You Need
It can be challenging to navigate the business travel landscape on your own. At JTB Business Travel, we are a corporate travel agency that helps companies make the most of their investments in travel — in part by reducing travel spend.
We provide a number of spend management services, including travel policy development, airline and rental car management, and even the tracking and management of unused tickets.
Contact us to learn more about ways to reduce your company’s travel spend.