It's not an easy time to be a business traveler. Your budget demands that you save money however you can--by taking clients to moderately-priced restaurants instead of the new trendy spot or doing business over coffee instead, packing more appointments into one day and taking the red-eye home so that you don't have to stay overnight, and packing light to avoid hefty airline baggage check fees. Some companies are even asking employees to (gasp!) room together to save on hotel costs.
Yet there are many ways for small businesses to save on travel expenses that can be less painful for you and your employees. First of all, get strategic about travel, and save trips for the most important meetings and customers. "It's hard to see those dollars go out the door when you don't see an immediate return," says Virginia Frazier Jackson, CPA and president of her own advisory business, Sankofa Financial Group.
Before even booking a trip, consider if a meeting could be as effective as a conference call or Web conference, suggests Jackson, who works full-time as corporate controller for Hanley Wood, LLC, a business-to-business media company for the construction industry based in Washington, DC. That might be the perfect solution for an initial customer meeting.
The company CEO should plan with her top salespeople to determine which clients and meetings truly require a personal visit. Even a product demo can look professional on a Webinar these days. Another strategy is to use trade shows and industry meetings as an opportunity to meet with several clients at once, Jackson offers. But if you have old-school clients or are a services-based business, it may be tougher do meetings on the cheap. For a relationship-oriented business, you are selling yourself, after all, says Jackson, and to seal the deal you will need to shake hands with your prospect at his or her place of business.
Once you prioritize your company travel, make sure to set some guidelines for employees. "Small businesses hemorrhage cash by not having a watertight travel policy," says Christopher Elliott, a nationally syndicated travel columnist. "They allow their employees to book wherever they want, however they want. Having a no policy-- or worse, a bad policy-- can really blow the T&E budget."
Here are a few more tips:
1. Airfare: Shop around and be flexible. With many airlines placing ever more restrictions on mileage plans, in most cases you're better off looking for the best rates from a number of carriers and if possible, flying at odd times (very early or very late) versus flying with one carrier to accrue miles. The one exception to shopping around is if you do the majority of your travel to one region, such as the upper Midwest, always using the airline that serves that region (in this case, Northwest) will likely save you the most money in terms of rewards for frequent travel.
Credit cards increasingly offer benefits to their customers in the form of cash rebates for travel on any airline, Jackson says. The AMEX corporate card program can accumulate all your points from individual cards into one reward bucket that employees can pull from when they book travel, Jackson adds. (Although, many companies still allow employees to keep their points for personal use as a measure of goodwill).
She also advises using search engines and sites such as Priceline, Hotwire, and Expedia to find the best deals. "You'll need to spend some time digging around, as most small companies can’t afford a travel agent," she warns. As always, booking more than seven days ahead will save you money, which means you'll need to be thoughtful versus last-minute about your travel schedule.
2. Hotels: membership cards do pay off. Even the largest chains are hurting for business these days, so it pays to obtain as many memberships as possible to accrue loyalty points for room upgrades or free stays. Check for rates on the hotel website first, as they are often cheaper than calling reservations, Jackson says. And, even though you have less leverage as a small business, it doesn't hurt to ask a hotel that you visit frequently for lower corporate rates.
3. Car rentals: minimize your days and look for cheap parking. "On many trips I rent a car only for the days I need one, "writes David Grossman with USA Today. "This works nicely if you're staying in the city and need to use the car to attend meetings in the suburbs, for example. Even if you need a car every day, renting and returning the vehicle each day can help avoid costly overnight parking at a city hotel." Other tips for cheap parking include street parking versus in the hotel garage, if you're going to be moving it in the morning before parking meters are enforced, he adds. Grossman also recommends checking out car rental discounts offered by airlines or large organizations such as AAA.
Saving money on travel takes diligence. But with a little effort, you can cut a lot of fat from a notoriously problematic area for businesses of all sizes.
