For many companies, corporate travel is a necessary, and expensive, part of business life. According to one estimate, business travel is the third largest controllable line item affecting profitability.
Keeping business travel costs under control should always be a management priority, but it’s especially important during tight economic times. Consider these tips for reducing your company’s travel expenses:
- Perform a comprehensive audit: An audit of your company’s travel program should be the first step in your cost reduction efforts because you can’t target areas to cut until you determine exactly how much you’re spending and where that money’s going. Depending on your travel budget, consider hiring a consultant to perform an audit for you.
- Meet via videoconference: The quality and sophistication of Web-based conferencing services have improved to the point that flying cross-country to meet face to face with clients or partners is less necessary. If you don’t own such technology, you can usually rent facilities at a fraction of the cost of a business trip.
- Establish preferred vendor relationships: Most major hotels and car rental companies will negotiate reduced rates with business customers that agree to make them their preferred vendor. Make sure all employees are aware of these relationships and choose the preferred vendors when traveling.
- Reduce or eliminate employee perks: During the boom times, many companies grew lax, with everything from tickets for concerts and sporting events to first-class upgrades and drinks and snacks in the mini-bar for their traveling employees. Establish policies that detail when such perks are and are not appropriate, and communicate them to all employees who travel on business.
- Work with a corporate travel agency: The Internet has made travel arrangements a do-it-yourself prospect for most people in the 21st century. However, if you or your employees travel frequently, you could benefit from the services of a corporate travel agency, which can save you and your employees valuable time and possibly negotiate volume discounts on airfares, hotel stays, and car rentals.
- Take ownership of frequent flyer miles and hotel points: Employees typically keep these miles and points for themselves. However, your company may be able to claim them if you structure their purchase correctly and then use them to acquire free and reduced-cost flights and hotel stays for future employee travel. Keep in mind, however, that employees who travel frequently for business see miles and points as a huge perk to the business travel grind, so consider how much it will save you and whether it’s worth the hit to employee morale.
- Involve your employees: Ask your employees for cost-saving tips. After all, they are often the ones who spend the most time on the road and can see opportunities for cost savings most clearly. When one company asked its employees for ways to save on travel costs, they came up with many great ideas, including having their spouses drop them off at the airport to save overnight airport parking fees; buying portable GPS devices for salespeople who travel often to save the upgrade fee every time they rent a car; packing light to allow baggage carry-ons to avoid checked-bag fees; and sharing hotel rooms when traveling together (if employees are the same sex).
Don Sadler is a freelance writer and editor specializing in business and finance.