It is important to plan to leverage your program to maximize your corporate travel budget. It is not enough to tell travelers to choose the lowest logical airfare. These are some of the factors that you should consider when planning and evaluating your travel program.
- Travel policy
A well-written and widely distributed travel policy is the cornerstone of any successful travel program. I am constantly amazed at how many companies have an outdated or poorly-conceived travel policy. A well-written policy is easy to find. You can easily find one online. It is important that the policy is written to reflect corporate culture and that it is distributed within the company to ensure that everyone is aware of it and agrees to it. To ensure everyone understands and owns the policy, it’s a good idea for them to sign a copy. It is a good idea to have everyone sign a copy of this travel policy regardless of whether they travel. They might be asked to travel if they change their positions within the company. It doesn’t have to be complicated or long. The best travel policies I’ve ever seen were just a few pages in length.
- Centralized travel both internally and outwardly
Companies that do not centralize their travel program pay the price in lost expense reduction and reduced efficiency. Companies that don’t centralize their travel program fear that they will have to make travelers do things they do not want. They also fear that hiring a Travel Manager would be necessary to centralize travel. These are legitimate concerns, but they don’t have to be the norm. You are not limiting travelers’ flexibility by requiring them to book centrally. It is possible to centralize travel, but still allow travelers to book their travel on their own through a trusted provider or agency. You can have one point of contact for all travel questions, both internal and external. A full-time travel manager is not necessary if your company travels for less than $1million annually. These cases can be handled by the finance department, human resource, or an executive assistant. Let’s take a look at some of the benefits that centralizing travel can bring.
You gain in many important ways when you centralize your travel with one agency. Travelers will be able to contact one agency for any problems, and they will also have one place to turn to for all their travel needs. This eliminates the need to consolidate travel reports from multiple sources. You will benefit greatly from economies of scale by combining travel. You can obtain more value from your travel suppliers if you can compare total travel between different divisions and locations. This will enable you to get more out of airline soft dollar programs. You’ll get more free tickets, upgrades, and a larger percentage discount from our preferred airline. Also, your hotel and car contract rates will be better negotiated. You will also see a decrease in fulfillment costs as the travel agency will often offer discounts for higher volumes of travel.
- A mix of personal service and online booking
This addendum is to the previous element. It calls for centralizing travel through one agency. While this is essential, it doesn’t mean that travelers should be required to book online or call the agency directly. You are achieving several goals by giving travelers the choice of either. Online bookings are cheaper than traditional methods of booking. You give travelers control and increase their morale. You also leave open the possibility of using your online booking engine to book less complicated itineraries. Senior executives, frequent travellers, and more complex itineraries can be booked directly with travel agents that can provide a higher level service and offer a better overall experience.
- Take a look under every stone
Although most travel plans revolve around air costs, there are other areas you can look into to save money. You can also look into negotiating hotel rates at your preferred hotels or renting cars with a preferred supplier to save money. Many times, your travel agency already has discounted rates due to consortia affiliations or agency car contracts. You should also look into other areas. If ground transportation is an issue, suppliers will often offer discounts and direct billing options. Direct billing arrangements with hotels or car rental agencies is a great way for accounting staff to save time and increase efficiency.
- Use hard and soft dollars to leverage
Today, most major airlines offer both hard dollar discounts and soft dollar incentives to reward company loyalty for their products. In return for market share, you may be eligible to receive a discount on the lowest fares from your chosen carrier if your total travel spend exceeds $1 million. If you have secondary carriers or your travel volume is lower than the minimum airline requirement, soft dollar programs can be used to get free tickets, upgrades and status enhancements, as well as airport club passes or free tickets. These programs do not require a lot of volume. However, they aren’t well-publicized so you might need to search for them or ask Baker Travel to direct you.
- Do not neglect hotel volume
Sometimes hotel volume is overlooked, but it shouldn’t be. You can negotiate rates directly with the hotel or through your travel agent. In exchange for a minimum stay/night commitment, individual hotels in close proximity to corporate locations may negotiate reduced rates. You are likely to get discounts of up to 50% when you use a travel agency to book thousands of hotels around the world.
- At least one car rental agreement
It is easy to sign rental car contracts and they require very little commitment from the company. Look for a partner with airport locations and an excellent reputation for customer service. It is possible to save as much as 5-10% and also get frequent renter memberships for your employees. This will increase their efficiency and morale. Direct billing agreements can be entered into at the same moment. This can make it easier for your accountants and travelers to do their jobs.
- Understand group meetings
When you travel with groups or meet at one destination, hotels and airlines will offer discounts on your rates and fares. These meetings contracts can offer airfare discounts up to 2-10%. If you have enough passengers on one airline, you might be able negotiate for free tickets at contract completion. The minimum number of travelers required is normally 10 people traveling to the same destination at the same time. You should check with your airline to see if they have any higher minimums. The minimum number of rooms required to get a discount on hotel rates is 10. These discounts may range from 10% to much more depending on seasonal variations and occupancy rates.
- Improve metrics consistently by using reporting
To be successful, well-managed travel programs need to be monitored and properly leveraged. You should insist on customized, timely reports that are tailored to your needs. Regular reporting on provider performance and traveler behavior will help you meet your contract obligations, reduce costs, and identify future savings opportunities.
- Explore all options to improve traveler comfort and efficiency
A well-managed travel program will consider the comfort and productivity needs of its travelers. Comfortable travelers can concentrate on the main priorities that will help your business grow. Travelers who are happy perform better. Ask your travel agency if they can upgrade travelers to a preferred airline. Consider purchasing airport club passes in blocks so that they can be used strategically on long, complex itineraries. There are many rewards that can be given to travelers who have endured the often difficult task of traveling. These rewards can be used to build loyalty and increase productivity.
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