Business travel can be a great asset to your company. It helps strengthen employee relationships, build company morale, and foster creativity.
In fact, a recent report by the U.S Travel Association reveals that for every dollar spent on business trips, companies earn an average of $2.90 in new profits and $9.50 in increased revenue.
But business travel can come at a huge cost. The expenses can sometimes get out of hand, and the drawbacks may outweigh the benefits.
Read on to find out how you can minimize your travel spend and plan for more cost-efficient business trips.
Last-minute travel is fairly common in most companies -- in some instances, it’s unavoidable.
Recent research shows that by booking days in advance, you can save a lot more money. A study by Concur reveals that:
Generally, as these stats show, the earlier you buy your ticket, the more you save. So, try to be flexible with your departure dates -- sometimes flying a day earlier can significantly reduce your costs.
Try to hop on a Wednesday or Thursday flight. You’ll often find there are cheaper flights on offer on such days. And if you’re really strapped for cash, then you can take the early-morning flights or even look for the lesser-known airlines.
On top of cutting costs, booking earlier can also make for a more organized trip. Leaving things until the last minute often results in some dangerous consequences in the business world, and this also applies to corporate trips.
No one wants to go on a trip where the organizer makes decisions on the fly. Your employee’s motivation for future travels may take a hit.
To ensure you’re always making early reservations, you can set a timeline with your travel team, and notify your staff that they must stick to it.
For instance, you can require your employees to book their flights at least two weeks before your departure date. This way, they’ll have ample time to prepare for the trip, and you may save a lot more -- a win-win situation.
For the most part, business owners use two approaches to deal with high travel expenses. One, they accept them as the cost of being in business. Secondly, they try to reduce costs by implementing low spending limits and introducing strict travel policies.
With the first approach, the business's bottom line takes a hit. With the second approach, employees are more likely to grow dissatisfied with the company, and as a result, leave for greener pastures.
But there’s a much better approach that companies have started using recently: rewarding employees who spend less money during company trips.
It’s cost-efficient and you can easily introduce it in your business. For instance, you can offer employees who spend less than the allocated budget a percentage of the money they’ve saved.
And your rewards can take many forms -- they don’t have to be limited to savings. You can offer your employees vouchers to popular stores, or simply some needed time off.
Any reward will do wonders for your bottom line, as long as it accomplishes its goals: thanking your workers for being cost-efficient and encouraging them to continue saving the business’ money.
With every money-saving decision your employers make, your company’s savings continue to add up. By the time the year ends, you may have cut costs significantly.
Google, for instance, follows this approach to a great extent with its Trips program. Every Google employee receives a budget before each trip. If they remain under budget, they win credits that they can redeem in future travels. Essentially, the company encourages them to save today so that they can spend lavishly tomorrow.
Another easy way to squeeze extra savings is to make use of corporate reward programs. Most hotel chains and airlines offer some sort of reward scheme to its loyal customers, and the best part is that you don’t have to pay any fees to join the schemes.
Every time you make a reservation, you earn a point. If you accumulate enough points, you can redeem them to get cheaper airline tickets or upgrades to your hotel stays.
Reward programs can especially come in handy for small business owners, who can save hundreds of dollars per year by taking advantage of them.
Another great idea is to call airlines directly to inquire if they offer corporate discounts. Most popular airlines, car rental companies, and hotels offer discounts to businesses that can be as high as 25%, and the size of your traveling team doesn’t matter to them.
You can also use a travel agent to discover some worthwhile discounts -- and in the best-case scenario, they may offer you a discount as well.
An expense management platform gives you more power over your travel spend, helping you monitor your employees’ travel expenses from anywhere at any time. When traveling, your employees can scan their receipts using a mobile app, which reduces the possibility of lost receipts and any travel-related documents.
Penny Inc, for example, can help you stay on budget during business trips. With a prepaid MasterCard or virtual card, you can set spending limits for your employees.
And the app goes the extra mile by regularly sending expense reminders to your employees so that they can monitor their limits. And you can either approve or deny any spending that can blow your budget. What’s better is that the platform is completely free.
Sign up for an account today.
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