7 Ways to Cut Travel Expenses to Keep A Lean Business Model

When you run a business, there will be different types of expenses related to it, and some of them are quite mandatory. However, specific business operation related costs can be controlled with proper planning and analysis. 

This is critical to maintaining a lean business model that can be quite profitable. The cost structure is one of the critical ingredients for a successful business model

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One such example is business travel-related costs. The reality is business travel cost is not easy to predict, and various unforeseen elements can increase it when you least expect.

Why business travel costs tend to be unpredictable

Before you delve into controlling the travel budget of your company, it is essential to understand why it may shoot upwards at times. Listed below are the reasons business travel expenses getting inflated:

  • Different employees may have different mindsets and habits which may add up to the travel cost. For example, some employees may plan a business trip with a personal vacation, and they may incur higher flight cost by returning after an extended weekend.
  • Sometimes, the companies fail to figure out factors like regional festivals and annual events, making accommodation costs, higher when their employees are on business trips in cities that are tourist destinations.
  • Sometimes, business trips may have to be planned at short notice and finding a budget flight and accommodation deals can be tough.

Ways to cut down business travel-related costs

While business travel will be a necessity, with proper planning and analysis, it is indeed possible to keep the cost under a limit. Listed below are a few handy tips to curtail your company’s business travel related expenses.

Cutting down on travel plans

Thanks to the progress of technology, it is sometimes possible to evade business trips and deploy advanced technological means to meet business needs. 

For example, if you feel consultation with a foreign client can be done over video conferencing, travel cost may be evaded. Skype is there, and you can resort to similar feature-laden video conferencing apps for this purpose. This can help you save a lot of money.

Planning business trips carefully

Before planning a business trip to any place, analyzing certain factors that can add up to overall cost proves to be helpful. For instance, planning a trip to a city that is also a significant tourist destination in peak seasons can prove to be ineffective for business travel cost curtailing.

 Any business trip in Christmas and New Year timing will be costlier than trips made a month earlier or later, as a thumb rule. Sometimes, using smaller airports near the destination can help you save more money.

Planning in advance

Planning business trips in advance help you save a lot in both transport and accommodation fronts. By planning trips of your company employees a few months in advance, you may get great deals on both airfare and hotels. 

It will be a good idea to sign up for newsletters and emails of travel management service providers if your company employees need to make such trips a few times every year. You will get updates on bargain flight and accommodation deals and make the most of those!

Taking advantage of the loyalty/rewards program

Nowadays, the majority of hotel chains and airlines offer exclusive loyalty and rewards scheme for regular customers. These schemes can be utilized by the businesses as well. 

You can save a significant amount by using flyers loyalty schemes offend by specific airlines by buying tickets from that airline exclusively for all business trips for the workforce. The same thing applies to hotels where those employees will be staying on such trips.

Setting realistic transport and food allowances

Sometimes, the employees end up incurring the bills on business trips by spending on intracity transport, food, and allied costs. This is where you need to put the focus on. 

While it is true the employees will need some allowances for such things during business trips; overspending can be controlled. Set realistic travel and food allowances for the employees for those trips. Ask them to use public transport when possible at the destination instead of using a cab every time.

Making incentives and rewards

It can be a good idea to encourage employees to save money on business trips and to be more productive. You may introduce rewards for those employees who can save a significant amount from business travel allowances without cutting down on productivity. 

This can be a monetary incentive or something that will be of use to them, eventually.

Using the services of a travel management company

If you find calculating and analyzing various nuances of business travel and finding the best deals for each trip complicated, there is a way out! You can opt for the services of third party travel management services companies. 

You can find many such entities nowadays, and they cater to corporate travel needs.

Key takeaway

While business travel cost control can sometimes be complicated and analysis of several factors are involved, it is not exactly a Herculean task! 

You need to get the basics right and plan for each trip well in advance to curtail the cost. Using technology and online services can be quite useful in this regard.

Guest Post by Namit Empronc:

Namit is fond of reading, writing & meeting people. He loves writing about Spend Management Software. In a former life, he worked as a content specialist and has good knowledge about finance.

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Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which he brought to reach about a million business students, professionals, and entrepreneurs in 2019 alone | Gennaro is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate and become profitable | Gennaro is an International MBA with emphasis on Corporate Finance | Subscribe to the FourWeekMBA Newsletter | Or Get in touch with Gennaro here

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