Corporate Expense Management Challenged by Rising Costs in 2013
It looks like businesses will need to count their travel and expense dollars a little more carefully over the next year, according to a new survey from the Global Business Travel Association (GBTA). Executive Travel Magazine reports there has been enough of an economic upturn in the travel industry that prices have climbed right alongside the more optimistic outlook, but that leaves businesses reliant on travel in a position where they’ll have to monitor their expense management even more closely. While an increase in costs was expected to go along with the upward shift in demand, many corporate travel managers say their budgets will not be expanded to match the price increases.
“Travel prices will be rising across the board, with international price growth especially robust as companies look abroad for opportunities,” said Joseph Bates, GBTA’s vice president of research. “Travel buyers are being pushed to balance higher costs, the need to get travelers on the road, and corporate budget constraints.” Typically, businesses can rely on contracts to help ease tightening budgets, but 2013 is expected to be a tougher year for negotiations.
While negotiations may not stretch as far as businesses would like, companies can still maximize their travel dollars in other ways, including through deployment of expense management software. Ensuring compliance, that purchases are made according to a preferred vendor list and that travel managers and employees make the most of negotiated contracts already in place can go a long way in terms of minimizing budgetary impact. Beyond the expansive internal visibility it provides, expense report software can now travel with employees through mobile apps, simplifying the process of making travel reservations and filing expense reports while on the road.
GBTA’s survey included 300 corporate travel buyers, who collectively anticipate a 4.6 percent increase in domestic airfares, an 8.3 percent increase in international airfares, a 3.7 percent increase in U.S. hotel rates and an 8 percent boost in foreign market hotel costs.