Unmanaged travel costs both time and money. If nobody within an organization is responsible for business travel or travel policy, your company could be facing a problem. With the continued growth of business travel, it can be a difficult aspect of your business to streamline and perfect when not managed properly.
Industry data confirms that 445 million business trips are taken annually. Profits are directly related to business travel – for every dollar spent, companies commonly see a $2.90 increase in profit and a $9.50 increase in revenue. Business travel is one of the largest costs to your business – but do you know what it’s really costing?
Unmanaged travel – You’re spending more money than you should
Employees left to their own devices will often book their trips without thinking of the bigger picture. They will often choose hotels or airfare based on personal preference and not price. Travellers will upgrade their airline seats and hotel room because they assume the company won’t really mind. They don’t know that supplier loyalty can generate big savings.
Even with the best of intentions, and hours available to shop for airfares, hotels, or car rental, your company will always struggle to get the best available rates. A tight travel policy that requires the lowest fares and rates will only get you so far.
Travel management companies use their buying power and industry knowledge to negotiate the lowest rates with trusted suppliers. In addition to preferred rates, a managed travel program increases travel policy adherence, ensures the use of unused tickets and provides travel spend reporting. Coupled with proactive account management, travel program savings add up quickly.
Unmanaged travel – You’re spending more time than you should
Most expense items have both direct and indirect costs. Business travel does as well. Time is a large indirect cost. Studies show that a business spends an average of 3 hours when arranging a single trip. Anyone who has spent hours searching online for a holiday knows how much time can be spent searching for the best travel options and prices.
And this is especially easy to see when you break down all the steps that occur when planning a trip. This includes everything from trip approval, to gathering required travel documents, finding the best airfare, investigating travel insurance, finding and booking a reputable hotel, and arranging car rentals or transfers.
Breaking down the trip components, it’s easy to see how unmanaged travel can take more time than you think. And it’s easy to see that employees could be carrying on with more productive tasks central to their role.
According to GBTA and other industry experts, a managed travel program should provide a 10-12% savings of total travel spend. Would you like to start addressing your company’s travel costs? Plus Travel Group can help! Contact us to find out more about our corporate travel solutions.