Top three findings for finance professionals managing travel expenses
As corporate travel returns, companies are showing increased focus on driving compliance through a corporate booking tool, and are walking away from online travel agencies. The era of time-consuming processes, booking outside of corporate policy and overpaying for travel changes is over. Companies of all shapes and sizes are rethinking how they manage business travel expenses and traveller well-being. Here are a few key findings that explain this trend.
Key finding number one: Business travel expenses are the second-largest controllable expense in a company[i]
One of the best ways to control expenses is by making it easy for your employees to support your saving goals. If your employees have an incentive to control costs for business purposes, they’ll help you. If not, you’re on your own. When you partner with a corporate travel booking tool, it’s easy to increase compliance through built-in policy guidance. And as compliance goes up, costs go down.
Situations are so fluid these days that travel policy is—or should be—continually updated. To make it easy, travel and budget policies are built into the corporate booking tool to guide travellers’ spending and support compliance. Visual flags alert both travellers and travel arrangers when a booking is made above the cost limit for that specific traveller. Different policies and cost limits can be set for different types of travellers for large and small businesses alike.
Harvard Business Review recently reported that 51 per cent of business leaders said that their organisation maintained control over business trip expenses and reduced costs over in-person business meetings in the last year thanks to their strong travel culture and subsequent approach to travel management. Here are a few examples of how a corporate travel platform can provide cost control:
- Automated, real-time policy compliance monitoring and enforcement
- Custom policy groups by departments, teams and projects
- Relevant travel options at a lower rate than publicly available
- An automatic refund or credit note for eligible unused air tickets
- A mobile app with last-minute hotel deals of up to 70 per cent off
Business travel is both a controllable expense and a driver of growth. Travel management platforms provide you with the visibility to measure the success of your travel programme through reporting tools. Reporting provides visibility into policy compliance and online adoption, which are two critical drivers for savings on travel costs. It’s easy show your travel programme's actual cost and value when you have access to dashboards that allow you to filter by spend history, booking data and traveller behaviours. And don’t forget that access to real-time spend analytics supports better financial planning, budgeting and forecasting.
Businesses that partner with a travel management company see a positive return on investment. The fee structure is low, and it essentially pays for itself by tracking unused air tickets. When travellers must change or cancel a flight, they shouldn’t have to go through the hassle of managing vouchers or jumping through tedious hoops to recoup unused airfare tickets. Corporate travel platforms make it easy to apply credit from unused tickets to new bookings, displaying credits directly in the search results.
Key finding number two: Businesses that operate without a corporate booking tool spend an average of 13.6 hours per trip to process travel and related expenses[ii]
If you’re currently operating an unmanaged travel programme, you still rely on manual work by inputting data into spreadsheets to manage travel and actual expenses. Research from Forrester found that it takes travellers, approvers, auditors and accountants a combined 13.6 hours per trip on average to process travel and associated expenses.
Contrast that with the average time that it takes for a traveller to book through a corporate travel platform—four minutes for a hotel and five minutes for air, car and train. Travellers no longer need to spend hours on every trip communicating preferences, approving itineraries, submitting expenses or changing bookings. They can focus more time on their job.
The role of a travel management company is to secure the best deals effortlessly with an intuitive booking experience for travellers and arrangers. Following travel policy and compliance is necessary, but employees are happiest when they have options. There is a need to lean towards providing your employees with the information needed to make the best travel decisions on their own. The more your employees are empowered to arrange their own travel, the lighter the burden becomes for your admin and finance teams. And employees want to manage their itineraries. The goal is to offer opportunities without costing your business more money.
Key finding number three: Most finance managers (84%) say that their company is less than fully prepared to handle an increase in business travel in 2022[iii]
One reason that finance managers don’t feel confident about relaunching their corporate travel programme is because the company is relying on outdated and manual processes. There are some serious challenges with the payment and reimbursement process. Travellers are not only tracking transport receipts, but also dry cleaning, business meals, incidental expenses and other business activities.
According to the ‘Egencia Business Travel and Technology Survey’, 33 per cent of business travellers use personal cards exclusively for business travel expenses. This complicates the range of deductible business expenses and involves a paper trail. Many companies are hesitant about providing physical corporate credit cards to their employees, but with a corporate travel platform, the credit card information is secure and filed in the booking platform. No physical card is needed. Purchases on the credit card can be set up to not be charged until an approver reviews the itinerary. The approver will be notified as soon as a purchase is made. Consolidating credit card transactions directly into an expense system in just a click creates a more seamless experience for travellers.
The other main reason finance managers are hesitant to increase their business travel is that they lack the resources to mitigate risk. To successfully compete in the global marketplace, companies need to show genuine empathy and concern for their employees’ well-being, which means considering new factors beyond savings and basic corporate travel safety to give their travellers peace of mind.
More businesses are looking for travel solutions that support their travellers at every stage of their trip. Here are examples for each phase of the business travel journey:
- Pre-travel—Supporting travellers before their business trip means removing obstacles and paving a smooth path through the booking process, while ensuring that your travellers are empowered and informed. Corporate travel technology prioritises search results based on intelligent weighting of variables such as stopover time, bag costs and even travellers’ preferences based on previous choices. Another layer of transparency is access to supplier-specific health and hygiene information in the booking process.
- While on the road—A big part of risk management when your travellers are on the road is making sure that you can reach travellers in case of a crisis so that they can receive help, support and timely information when they need it. When an emergency strikes or is on the horizon, it’s essential that travellers are immediately informed. Corporate travel platforms keep travel managers and travellers aware of disruptions to an itinerary through instant messaging on their phones and in the mobile app. You can also access covid-related protocols or guidelines for specific business destinations. Learn more about travel risk management here.
- Upon return—Travellers appreciate saving time and headaches with expense reporting once they get home. Your travel programme needs to streamline expense reporting for travellers and finance staff. The right travel partner will allow you to capture employees’ business travel expenses within the booking tool. Travellers can record any additional trip receipts on their phone to attach to their itinerary. They can also create and submit expense reports straight from their phone, which managers can approve with a simple click. All data—offline, online and any custom data—is passed on to an expense management system for a simple, streamlined reimbursement process. Anything transaction-based or tax-deductible is consolidated in one reimbursement.
Your travel programme can play a role in building an inclusive and unified company culture. With the support of a corporate travel platform, finance professionals can control costs, reduce manual processes and improve the business traveller experience.