Media Releases

10 March 2010

10 Golden Rules of Travel for Cost Conscious SMEs

AUSTRALIA'S travel revival is being accelerated by the rapid growth of the SME sector with many businesses continuing to travel despite tougher economic conditions. For SMEs where travel is an integral part of their business, the annual spend on travel can be anywhere between $50,000 and $2 million, with the average spend around $200,000, according to specialist SME travel provider Corporate Traveller.

"For many businesses, the cost of T&E (travel and entertainment) is the third highest company expense behind wages and the cost of maintaining a business premises," Corporate Traveller area leader for WA Stephan van Arnhem said.

"It's for this reason businesses need to manage their travel strategically to control costs and drive the maximum value from their travel dollars." Mr van Arnhem said there were a number of ways SMEs could reduce the cost of their business travel with the first step being to work with the one travel manager.

10 golden rules of smarter business travel for SMEs

1. Work with the one travel manager - SMEs require specialist expertise from one person who understands a company's unique travel patterns, its needs and cost parameters.
2. Create a cost savings travel plan - Ask your travel manager to assess how your business spends its travel dollars and then work out a plan to reduce those costs.
3. Develop a travel policy - Put together a program which includes travel guidelines that everyone in the business must abide by. The policy will include guidelines for booking accommodation, flights and car hire that will help to drive savings through strategic travel management.
4. Educate your staff - Communicate the guidelines of your policy to staff clearly. This ensures all of your people know what is expected of them when they're travelling for business. Staff should know about any changes to the policy and should be able to access the document easily.
5. Use Best Rate of the Day for accommodation - Ask your travel manager to use a combination of dynamic pricing including Best (or lowest) Rate of the Day and or corporate hotel rates to secure the best possible price for your accommodation. As part of the Flight Centre Limited group of travel brands, Corporate Traveller has access to the largest selection of hotel rates from around the world.
6. Maximise savings through advance purchcase - Include guidelines in your travel policy to encourage travellers to book their airfares as early as possible. A recent Corporate Traveller study shows businesses can save up to 72 per cent on the cost of their air tickets if they book three weeks in advance rather than last minute.
7. Use a Best Fare of Day strategy - Ask your travel manager to book all your domestic flights using a ‘Best Fay of the Day' strategy. This ensures you get the lowest possible airfare available on the day of booking, as advertised by a spread of carriers.
8. Use Best Rate of Day for car hire - Ask your travel manager about using a combination of dynamic pricing with Best Rate of the Day or a negotiated preferred partner rate. This will help to keep car hire rates competitive for you no matter which way the market fluctuates.
9. Check the fine print on travel insurance - Offers of free travel insurance on credit cards or business policies often have capped medical or dental cover. A staff accident or an emergency during a business trip could end up costing a business hundreds of thousands of dollars without comprehensive cover.
10. Hold regular reviews with your travel manager - Work with your travel manager to continually assess the success of your travel policy through benchmarking. Your travel manager can also help to identify opportunities to reduce costs by looking at items such as travel policy compliance, missed savings, advance purchase airfares or fees incurred through booking changes.