Cost Reduction
Optimising your company’s travel costs

Optimising your company’s travel costs

The need to travel is often an essential factor in the success of your business, involving the majority of significant costly situations, as well as a considerable use of time.
For that reason, it becomes important to find solutions that allow the respective cost to be reduced, like allowing time currently used on travel in a more productive way.

  • Defining a clear policy on trips/travel.
    It is essential that there is a clearly defined policy. This is the only way to guarantee equal treatment within the company, respecting hierarchies, duties and defining approval, booking, expenses and reporting procedures. Defining this policy allows monitoring and control to be possible, thus pre-empting possible abuses.
  • Planning in advance.
    Although we know it’s not always possible, planning in advance is essential in order to be able to ensure the same trip can be made at a lower cost. But it should at least be a consideration in any trip that needs to be made. If the company does not cultivate this attitude, soon all trips will become urgent, with the significant escalation of costs that this involves. An urgent trip can easily cost twice as much as the same trip planned in advance. Analyse regular trips and try to define those which could and should be planned ahead of time.
  • Form a partnership with an agency.
    It is wrong to think that only large companies have the scope to form partnerships with travel agencies. Nowadays, any company can do it, with benefits in terms of direct costs of trips, and in the time spent by people at the company on planning and contracting travel. When negotiating a partnership with a travel agency, consider the type of trips that are regularly made, and when negotiating the fee model, prioritise the Transaction Fee model for the type of operation, rather than the percentage on cost of trip model.
  • It must be a necessary trip.
    This doesn’t necessarily mean that the reason for planning the trip is not valid, but physical presence must truly be needed. If we’re talking about conferences or fairs, I obviously need to be physically present at the venue, but if we are referring to meetings with the company’s other departments or delegations, or even with suppliers or clients, this need to actually be at the meeting might not be justified. Nowadays, the great evolution witnessed in the area of communications, IT and the market linked to the internet means it is possible to hold highly productive meetings with interlocutors, with each of them at their own workplace, using online conference tools with video and audio, the possibility of exchanging and viewing documents online (e.g. presentations, documents, videos, etc.). What used to require large investments in equipment and communication lines, is today possible with an ordinary laptop and an internet connection.
    With the globalisation of the economy, businesses are finding it ever more important to have control over their travel costs. If the organisation does not adapt to modern times, not only will it continue to experience an escalation of these costs, it will also run the risk of the business becoming more and more inefficient.