How to Ensure Smart Cost Savings In Spite of Rising Travel Expenses
Travel and entertainment is the second-biggest operating cost in organizations. Of late, business travel expenditure has been shooting up globally due to two reasons—lack of proper control over expense reimbursement, and globally rising costs of air travel, local travel, and hotel accommodation.
According to “2015 Global Travel Price Outlook” published by Global Business Travel Association (GBTA) and Carlson Wagonlit Travel (CWT), global corporate travel was a US$ 1.1-trillion in 2013, and is expected to grow 8.6% in 2015. The report also projected a hike in hotel rates by 4%, air travel rates by 2% and car rentals by 1%. Businesstravelnews.com reports that hotel rates will go up about 5.5% to 6.5% in 2015.
These projected hikes are alarming for companies, big and small. For big companies, the number of frequent travellers will be more and for small companies, the travel budget will be small. In either case, budgets and P&L accounts will be greatly affected by the hikes. Can they mitigate the burden caused by the hikes?
Natural instinct leads companies to haggling for competitive rates. But that leads to lost opportunities and spoilt relations, without bringing any positive result. Some recommend employees go for hotels and travel providers with fewer facilities. Employee morale takes a hit and it brings the trouble of having to manage many smaller bills. Reporting, verifying and approving require much more labour as a result, thus offsetting the cost advantage of choosing cheaper options.
Technology gives you tighter control
Technology is the single big answer to all those woes. Low cost, cloud-based software (SaaS) and the power of big data analytics provide many simple solutions to spot the best travel options from thousands online.
Various companies offer similar software services. Some cater to individual segments like travel booking, travel expense management, intelligent expense controlling etc. Some advanced software packages integrate all of these features and simultaneously sync databases for greater efficiency.
Smart travel expense software can analyse various flight services and accommodation facilities available online. Based on your specific needs and company policies built into the software, it can pick up the best options. That makes life easy for you and your employees.
The analytical insights given by the software enables companies to plan and coordinate travel in a better manner. It helps to reduce excessive expenditure and fraudulent claims. A single software upgrade can have you track the expenses of the entire travel, capture bills with a snap, and submit the entire bill in a click for employees claiming expenses. This reduces a huge amount of manual labour, delay and confusion.
To sum it up, migrating to smart, integrated software can bring huge savings in money — about 10% on cost and 20 to 30% on employee expenses. This is especially attractive because of a low-cost subscription model which dodges the need for bulky investments. More and more firms are embracing smart technology to counter the rising cost of travel.