Is your budget under pressure from excessive business travel costs?

Business travel is an unavoidable expense that most companies will have to carefully budget around.

Business travel can take the form of long-distance international business trips or frequent domestic travel for business purposes. Both of these add up to some significant costs for your company.

Travel expenses can put a serious strain on the budget of an SME. However, being an SME also holds some advantages when it comes to business travel.

In this article we’ll go through some options your company can consider in order to reduce travel costs.

1.) Public Transport

An undesirable option for some, but one of the surefire ways to save on business travel costs.

Singapore’s transport system is (mostly) reliable. So using public transport for local business travel is something that companies should not have to shy away from. The same applies for public transport systems found in most major cities that would be common business destinations.

Besides the low base price, public transport also features the advantage of having a fixed price for all journeys. This makes it much easier for employees and management to budget for trips and keep track of expenses.

Furthermore, reimbursements for an employee’s travel between home and a business venue are not taxable by the Inland Revenue Authority of Singapore (IRAS). Provided that the travel was not via taxi. This makes public transport an even more appealing option for SME’s looking to cut travel costs.

2.) Ride-Hailing Apps (e.g. GrabCar)

An increasingly popular travel option that every business traveller should know how to utilize.

Ride-hailing apps can help save on the cost of hiring conventional taxis in Singapore and abroad. If you have an employee making an overseas business trip, it’s highly likely that either Uber or Grab are available at their destination.

Public transport is usually cheap, but it has severe limitations which makes it unreliable when travelling on a tight schedule.

Uber and GrabCar will make it easier for your employees to get to their destinations on time and without fuss. Using ride-hailing apps for business travel is a convenient and relatively budget friendly solution.

Grab comes with even more benefits for companies that incorporate it into their business travel policy. They have a business travel platform/solution known as “Grab for Work” which is extremely helpful in tracking travel costs and managing budgets.

There are automatically generated digital receipts for all trips taken which makes it easy for employees and employers to monitor travel costs. This digital element also saves you from the trouble of having to manually submit and review claims made using paper receipts and invoices which are difficult to keep track of. Furthermore, Grab for Work grants employees the flexibility of using multiple payment methods including corporate or personal credit/debit cards and cash. All of this also comes with tailored business travel statements for increased transparency and improved cash flow for employers.

Grab is available throughout Southeast Asia, so Grab for Work is definitely a worthwhile business travel solution to consider if your company operations require frequent business trips within the region. If travelling outside of Southeast Asia, Uber is available in most major cities and has a similar functionality where business travellers can set-up a business profile for Uber that can be integrated with business travel apps such as Concur.

3.) Travel Agencies

Travel agencies have been declining in popularity in recent years. As of 2018, many people do handle their travel bookings online via automated websites such as Agoda or booking.com.

However, travel agencies can still prove useful in this day an age, particularly for business travel arrangements.

Travel agents have the expertise and connections available to ensure that they secure the best possible prices for transport and accommodation that the average person would be unlikely to find online.

Connect with a travel management company for an easy solution to booking business travel.

Since business travel can also involve multiple employees travelling it once, it makes sense to consult a travel agent so that they can attempt to get further discounts for group travel.

Having a dedicated travel agent for your company will save your employees the headache of having to coordinate their travel. This means more efficient business trips for all of your employees in terms of cost, energy, time and planning.

4.) Take Advantage of Rewards Programs

Almost all major airlines and hotel chains offer rewards programs that provide free flights and stays, package upgrades, or significant discounts for membership holders/returning customers.

Some may think that taking advantage of rewards programs would be reserved for large companies with established business travel policies and brand relationships. In truth, it’s often impractical for large companies to incorporate these rewards into the travel budgets of all their employees.

SMEs, on the other hand, have more flexibility when it comes to booking business travel and taking advantage of rewards programs. Especially if there are a handful of employees in your company which are very frequent travellers.

Keep our following points in mind as well while also trying to take advantage of rewards programs. This could help your company could save hundreds, if not thousands of dollars per year on business travel.

Seek out hotels and airlines with the most generous reward programs to save money on frequent business travel.

5.) Open booking – an advantage for small businesses

Aside from relying on travel agencies, smaller businesses can take advantage of a concept known as open booking. This is a practice where employees are free to make their own travel arrangements through whichever channels they wish to use.

Large companies often have more well-defined business travel policies which tend to be less flexible. It’s a relatively common practice for large companies to have a go-to travel agent that will make arrangements through established channels in order to make bookings as smooth as possible.

Having a company travel agent can be very convenient, but as time goes on and travel policies solidify, you may end up missing out on alternative routes or travel carriers that can reduce the cost of each trip.

Whether it’s directly, online, or through a third-party channel, open booking allows employees to search for the most cost-effective and efficient ways for themselves to travel.

Get you employees into the practice of open booking for business travel and they could find numerous ways to cut down on business travel costs on their own.

The business travel policies of some companies may lead to employees being forced to utilize certain routes and brands. This is good for large companies who are more likely to have special deals and partnerships in place. SMEs, on the other hand, may want to focus on keeping costs as low as possible by whatever means necessary.

6.) Explore different routes and less well-known airlines

In this day and age, air travel is pretty much the only way to go when it comes to international business trips. Land and sea routes may exists between certain countries, but these are hardly conducive to efficient business travel.

Flying is usually the most expensive form of travel, but it’s an unavoidable necessity for business travel in the 21st century. As such, it would be wise to find ways to minimize the cost of trips taken in order to preserve your budget.

Try not to limit yourself to only flying with mainstream airline carriers such as AirAsia and Singapore Airlines. Use online tools such as Google Flights to help you find the most affordable route and airline combination possible for potentially huge savings. For example, a direct flight from Singapore to London using Singapore airlines can cost around $3000. A quick search on Google Flights will reveal that flying Qatar Airways with 1 layover will cut the cost all the way down to just $1000. Not to mention that Qatar Airways is actually a pretty decent airline.

When it comes to saving on air travel, keep an open mind and examine all the possibilities. You may even discover a rare gem of value that will benefit your business travel plans for years to come.

Rather than confining your employees to always taking the same route for business trips, try using alternate routes or carriers to yield savings in different circumstances.

7.) Avoid incidental costs

Incidental costs are extra unavoidable costs that a traveller has to pay over the course of a trip. For example Transport upon arriving at a destination country or having to pay for internet access.

We mentioned the value of being flexible when booking business travel during our last point. However, it would still be wise to have travel policies which ensure that employees plan around avoiding incidental costs.

Let’s take a traveller arriving in Singapore for example. A free shuttle to and from the airport would save a traveller about $60 for a necessary stage of their trip. These savings would be even more significant in common overseas travel destinations which have much more expensive ground travel costs. For example, In Melbourne, the only spontaneous options to unprepared travellers to get from the airport to the city centre would be a $60 taxi ride or a $20 bus going one way.

Train your employees to consider all possible costs when planning a trip. This will ensure smoother trips that also end up with less costs.

The same goes for internet access. Trying to find wifi or data sim cards can be difficult and expensive once you travel into the city. Do research in advance to find good deals for sim cards or pocket wifi routers that are available upon landing at the airport. It’s important to do this during the initial planning of your trip since you can usually get significant discounts for advance bookings. Over 30% off the original prices in some cases such as in South Korea.

Travel in overseas countries can be far more costly than we are used to in Singapore. Ensure that employees are well informed on how to avoid extra costs while still enjoying a relatively hassle-free trip.

 

Conclusion

Frequent business travel may seem like a troublesome and damaging expense at first. But there are many options for companies to cut business travel costs.

There are 2 key things for SMEs to keep in mind so they can save on business travel costs. Careful planning to avoid extra costs, and staying flexible in order to get the best deals possible.

If you ever need an extra boost of funds to make your budget work, consider applying for a loan through FS Bolt where you can apply for a loan of up to $50k that only takes around 2 hours for approval!

 

 


Sources

https://www.playwifikorea.com/pocket-wifi/

https://www.30secondstofly.com/corporate-travel-management/efficient-small-business-travel/#1_Travel_Agencies

https://www.cnbc.com/2016/05/18/7-ways-to-slash-business-travel-expenses.html

https://www.iras.gov.sg/IRASHome/Businesses/Employers/Tax-Treatment-of-Employee-Remuneration/Transport/#title3

https://www.grab.com/sg/workseotest/

https://smallbiztrends.com/2015/02/ways-to-save-money-on-business-travel.html

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