Whether you’re a Traveler, Executive, or Travel Manager, travel expense management comes with its challenges.
It’s no secret that the global economy hasn’t exactly been in spectacular condition over the last few years. According to a World Bank January 2024 press release, the end of 2024 will cap off the slowest half-decade of GDP growth in 30 years. In 2024, global trade growth will hit about half the average of what we saw before the Covid-19 pandemic.
On that note, if you’re looking to rein in your business expenses, as so many companies are, you may be considering how you can better manage your business travel spend. However, don’t make the mistake of jumping ahead and slashing your business travel altogether. Experts agree that the return of business travel and in-person meetings is important.
Whatever the state of the economy, whatever your organization’s financial goals, here’s how to get a better hold on your travel expense management. Once you do, you can continue sending your business Travelers out to clients, conferences, and events without watching your margins suffer in the process.
1. Create (and Enforce) a Travel Policy
The first step to better travel expense management? You need a travel policy. Every organization with frequent Travelers should have some sort of travel policy in place. If you don’t have one, this is your sign to draft one.
A travel policy not only provides your Travelers with details regarding how they should book their travel, how they should prepare for travel and how they should report their expenses. It also details what expenses they can claim. This will help ensure that your Travelers aren’t expensing unnecessary items, helping you reduce costs.
However, in order for a travel policy to be effective, you must enforce it. The policy should be thoroughly and clearly communicated to your Travelers. They should know what’s expected of them. Then, if they deviate away from the policy, there should be repercussions.
2. Enlist the Help of a Travel Management Company (TMC)
A TMC may not be a fit for every single company. However, managed travel and a TMC can definitely help when it comes to travel expense management.
A TMC can help you draft an effective travel policy that will reduce costs. They can also help you enforce that travel policy. Furthermore, they can help you with travel delays that you likely can’t get on your own. Many TMCs have strong relationships with travel brands. Plus, they have access to travel booking platforms that your team may not, have on their own. These relationships and tools result in lower costs for your company.
3. Plan, Plan, Plan Ahead
Of course, even the best travel policy in the world won’t help you truly cut down on your business travel costs or help with travel expense management, if you’ve not planned your travel with an expense management mindset.
As you think about your company’s travel, consider what travel is necessary. While some trips will definitely be worth the cost, others may not be. With the rise of remote work and virtual meetings, it’s becoming more acceptable to admit that some business meetings may just be best conducted remotely.
As you look at the upcoming year’s travel, book what you can book, ahead of time. Most travel policies restrict last-minute bookings to a degree anyway (and if yours doesn’t, it’s something to consider adding), and it’s a frequent Traveler tip, but it’s true — you can typically find the best prices the further ahead you book.
4. Find Thrifty, Sustainable Ways to Cut Costs
It may not make everyone happy, but getting a little thrifty with your travel expense management can really help reduce overall costs. In some cases, it can even make your business travel more sustainable and eco-friendlier.
For example, business-class and first-class seats on a flight are more expensive. But did you know that these seats also come with a higher carbon footprint than a seat in economy class?
Likewise, while taking public transit may not always be the most comfortable or preferable option while in a destination for a meeting or conference, it’s nearly always cheaper than a rideshare or car rental. Plus, it has the added benefit of being more sustainable.
5. Reward Employees for Money Saved
Some organizations have found that incentivizing employees to spend less on business travel works very well in helping the organization with its travel expense management.
For example, say a trip is budgeted to cost a certain amount. The employee booking and taking that trip spends overall less. Some companies will split that leftover money in the budget with the employee.
The company gets funds returned that it was expecting to spend on the trip. The employee is also rewarded and incentivized to spend as little on their trip as possible. (You may just find that employees are so incentivized with this method that they forgo creature comforts that they otherwise would not, such as staying in a higher-end hotel or taking a business-class flight.)
You might also allow employees to claim travel rewards and points for their travel policy-compliant spending and booking. This will give them travel perks and discounted or even free personal travel at a later date.
As bleisure travel (a mode of travel wherein an employee combines a business trip with a leisure trip, for more time in a destination after their work is completed) continues to grow, you might also consider loosening your travel policy to better accommodate this bleisure travel, for policy-compliant employees. The potential of being able to more affordably enjoy a leisure trip, when combining it with a business trip, may incentivize your employees to remain compliant. Thus, with this compliance, the company will save on travel spend.
Whatever Your Business Travel Management Needs, JTB Business Travel Can Help
Whether you need assistance crafting a more robust travel policy, overall Travel Management assistance, or just help tracking your business travel expenses, JTB Business Travel has a solution for you. Check out the suite of services and reach out to discuss your options today.
