If you’ve ever wondered what Corporate Travel actually is, the following article was written for you.
What is Corporate Travel?
Corporate Travel entails an owner or employees of a business (corporation) traveling. The starting point or destination of the trip does not alter its status of Corporate Travel, so long as the trip was made on behalf of the company.
What are the benefits of a Corporate Travel program?
When employees travel on behalf of their companies, they are likely meeting with people to enhance the business in some way. They might be selling products, or training others on product usage. Without spending guidelines in place, however, these trips can cost companies more than necessary.
What is A Travel Policy?
A travel policy allows business owners to limit which airlines may be flown, and which hotels or car rental companies may be rented from. This saves the company money, because by offering repeat business to a preferred airline, hotel, or car rental place, you can negotiate contracts with them. These companies will discount the cost of an airline ticket, for example, which in turn generates volume from your company. So your company pays less , and a considerable sum of money is saved.
As well, by showing loyalty to one or two popular hotel chains , you will eventually build up a relationship. Negotiated discounts will keep you coming back, saving your company money. Using one car rental company (rather than multiple companies) ensures better service from them, wherever you travel.
Your employees must make the same trips regardless of the cost, so why not save the company money?
Why Set Up Corporate Travel?
If you’re a smaller company with only a few hundred travelers, you might deem corporate travel unnecessary. Your travelers may already be booking the lowest airfares, lodging in the cheapest hotels, and renting the cheapest cars. CONSIDER THIS: Business travel arrangements change constantly and flexibility is your friend. “Cheap” rarely allows for flexibility, or many options.
Another benefit of having preferred suppliers is because unanticipated changes can be built into your airline contracts. “Flex funds’ or ‘soft dollars’, for instance, mean less stringent cancellation policies with the hotels. Many hotels advertise pre-paid, non-cancellable room rentals for less money. But business travelers with fluctuating business schedules can be trapped by those policies. A corporate contract with a hotel will offer the same low rates to your company (in exchange for volume) that will allow for cancellations within a certain time period. Corporate car rentals can be extended, and are generally cancellable right up to the last minute.
Corporate Travel Programs also monitor your employees’ bookings, ensuring that company policies are followed. A company travel agent might be hired for all bookings, or company-monitored online booking can be used. Either way, your travel policy is enforced; all infractions will show up in your monthly reports.
Booking agents must be familiar with policy, plus know the best flights and hotels for the trip. The process is smooth, quick, and hassle-free. International itineraries are better deferred to travel experts in that area. The downside of using one travel agency, however, is set/limited business hours. Contacting certain companies after-hours may warrant an extra charge.
Online booking is more cost-effective to a company, as employees have 24/7 access with internet connection. The travel policy is already set up, but option exploration may be time-consuming. Discussion with a corporate travel management company will help you decide which choice best suits your business.