When planning your budget for corporate travel expenses, several factors such as the current trends in travel, must be considered. Indeed, business travel may significantly affect your company or organization’s operating costs. And whether you’re creating a strategic travel budget for a Fortune 500 company or preparing a budget for a small business, you’ll want to integrate a model that meets your company’s objectives. But how do you plan a travel expense budget that matches your company’s goals?
Consider these 3 useful tips for corporate travel expense planning.
1. Establish Ways to Pay for Travel
A part of your travel expense planning should include ways you’ll want to pay for travel. Although you may find several options for paying for your employees’ travel, decide what works best for your company’s operation. Here are some of the most common methods that companies use to pay for employee travel expenses:
- Cash reimbursement to the employee: While this method works best if travel expenses are considerably small, expenses such as hotel and airline tickets should be allocated through a different method. Employees must keep detailed documentation of their expenses and receipts for their purchases.
- Company credit cards: Whether you’re a small business, non-profit organization, or corporate entity, company credit cards are an excellent method for handling business travel expenses. Billing statements that are provided with credit cards also provide an additional means for auditing purchases or other expenses.
- Per diem: This method allows the employee a set amount per day that they can spend while traveling. Depending on the company’s travel policies, the per-diem method may include approved expenses beyond transportation or food expenditures.
2. Analyze Your Expenses
Make sure that you are tracking your expenses with a system that organizes expenditures in separate categories. Whether you’re using an app that stores your travel planning data or you’re using a written system with file folders, you’ll want to review last year’s travel expenses and decide where you may be able to cut costs or save money. Are you taking multiple trips to the same location? Can you organize a monthly or quarterly visit to that location to ease your travel expense budget this year?
In addition, consider the costs of corporate travel using private charters versus commercial flights. You’ll want to research corporate jet options, but you’ll likely see why this investment option is becoming increasingly popular among businesses. Taking the time to analyze last year’s travel budget and expenses can also give you insight into where you might be able to save money by taking shorter or fewer trips.
3. Be Flexible with Travel Arrangements
Booking flights early can make a significant difference in whether or not you get the best rates on airline tickets. Furthermore, consider booking one-way tickets to and from your destinations to save extra dollars. You might also find reductions in priority seating. Studies have shown that by booking advance flights, travelers can expect to see substantial savings in ticket prices. And if you can book flights at least 15 days in advance, you’ll likely see more than 20% in savings!
Maximize Your Savings and Plan Ahead
The successful operation of a business hinges on strategic planning that considers all cost factors and may include a travel expense budget. Consider the aforementioned tips for travel expense planning as you navigate through your company’s upcoming travel agenda. Plan ahead and book early to take advantage of maximum savings at the ticket counter and remember to consider your company’s objectives when planning your travel budget.