Travel expenses under scrutiny as firms cut costs

News Article - 28 October 2010
Category: Business

UK firms are innovating business travel to keep it cost-effective at a time when financial austerity remains a major focus. Although budgets have tightened up in response to the competitive post-recession climate, travel bans have been implemented in only a minority of cases with most corporations making smarter choices when it comes to expenses policy.

A new study from American Express Business Travel reveals that over half of UK firms travel just as much as they did in 2002-2007. A further 4 per cent have seen business travel increase. Many are cutting the cost of travel significantly: over a third of businesses (36 per cent) reported savings of up to £50,000 per annum.

The most popular cost-cutting measure implemented was offering employees a greater range of video conference and telephone conference facilities (62 per cent). This was followed by asking staff to take public transport rather than taxis (46 per cent) and disallowing business and first-class travel options for short-haul flights. Downgrading hotel choices (38 per cent) was also a popular measure.

And businesses seem committed to reducing travel expenses throughout the entire organisation. One of the major changes implemented by companies has been senior figures - CEOs and CFOs in particular - setting the right example by cutting back on personal business expenses. A total of 46 per cent of staff surveyed said their bosses were taking measures to reduce travel costs including downgrading flights from business class, taking trains instead of flying and publically publishing their expenses for employees to read.

Whilst some companies are yet to implement cost-cutting policies for travel expenses, the survey suggests frugality will become the norm as companies realise just how significant a financial efficiency can be made. Thirty-three per cent of senior decision makers believe the measures will continue for the next two years, whilst 24 per cent feel they are a permanent blueprint for the future.

Behavioural change - such as reducing the number of business-class flights - is essential when cutting travel expenses, but the administrative cost of accounting for travel costs can also heavily add to the bill. Access expenses management software provides a fully integrated solution for managing staff expenses - including travel expenses. This reduces the administrative costs and reduces the impact to an organisation's bottom line.

For more information on the benefits of Access financial software, please call us on 0845 345 3300.

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