According to recent research, between 30% and 40% of corporate travel expenses are not managed or planned. Conducted by the observatory Avexia, the survey was published in March and presents five areas of corporate travel in which companies can work to optimize costs.
Expenses generated on road transport or, in other words, mileage allowances, taxis and parking costs, are one of the main expenses involved in such trips. According to the study, although the average level is 28%, these expenses can account for as much as 50% in many SMEs. One of the proposals for reducing expenses in this area is negotiating rates with taxi companies and car parks, or purchasing season passes and centralizing payments.
Another expense for which there is no efficient management is in the case of insurance which, according to Avexia, accounts for between 1% and 4% of corporate travel expenses, primarily depending on the destination. Analysing the company’s insurance policies may lead to a considerable improvement as we may identify shortcomings or duplicated coverage, integrate insurance into the company’s travel policy and improve internal communication in order to manage this area more effectively.
The secondary costs involved in air travel have multiplied dramatically in recent years. These are supplementary expenses such as paying to connect to the internet during the flight, checking in an additional suitcase or overweight luggage, etc. One of the options for optimizing such costs is to integrate them within the company’s expense policy and raise corporate travellers’ awareness of them, as well as purchasing the season tickets that certain companies offer for accessing their extra services.
Accommodation is another of the big expenses that companies with travelling employees have to face, which can amount to 20% to 40% of the total. Good practices include centralizing bookings, using corporate payment methods and event negotiating rates with the most commonly used hotel chains.
Lastly, living expenses, namely meals at restaurants with or without a customer, account for between 2.5% and 10% of expenses. An example of a practice that can help to optimize costs is using centralized booking platforms which enable expenses to be approved and controlled before they are incurred.