Small Business Resource

Without proper planning and careful consideration of how to handles travel expenditures, these expenses can break the monthly operating budget for a small business. Between airfare to visit clients and customers, food and lodging expenses to accommodate your employees, and all the little extras that accompany traveling and travel arrangements, you can swiftly find your costs skyrocketing. When employees realize that the company is paying, smart spending and economizing can quickly go by the wayside. By using a few smart saving techniques though, you can quickly find your costs reduced by hundreds, if not thousands of dollars a year.

1. Set out clear travel guidelines

It is pertinent to containing travel costs that you set clear and easy to understand guidelines for employees to follow. Let them know what is expected of them when they are out of the office on business related travel. Make sure they understand what costs the company will cover, what their travel budgets are, and how much they can spend on meals and miscellaneous expenses.

Having a defined travel policy will help eliminate confusion and keep costs lower since employees will know what are and aren’t acceptable charges and chargeable amounts while traveling. Rather than company credit cards, consider having employees use personal cards for expenses that they will have to submit for reimbursement. People will often be more reluctant to spend their own money even when they will be reimbursed later.

2. Open hotel house accounts

If employees will be frequenting certain hotels for multiple business trips, you can often request a group or preferred rate. By contacting the hotel sales department, you can set up an account that can provide lower rates based upon estimated stays. Contact a sales manager to discuss rates and discounts. Sales managers will often be willing to provide discounted rates to get the sales commission. Having an account with the hotel may also allow you to pay by way of a direct bill account, which delays immediate payment and allows you time to review bills, and dispute any issues, before you commit to paying.

3. Sign up for rewards accounts

Almost all major hotel chains offer rewards systems of some sort. Through these points plans you can receive free room upgrades, free or discounted room nights, and other amenities and offers for frequent stays. Finding one chain in particular and booking into their hotels can often build rewards quicker and increase the amount of discounts you are eligible to receive. Consider using credit cards that offer similar discounts and reward programs such as cash back or frequent flyer miles to maximize your company savings.

4. Combine or minimize travel activities

The best way to save money on travel costs is not to travel at all or at least to minimize your company’s travel activities. While eliminating travel expenses altogether might not be a plausible option, consider visiting multiple accounts on a single visit. This allows for the same number of account visits but on fewer trips. Instead of spending money on airfares, consider driving. Better yet, maybe teleconferencing or video conferencing are the ways to go in order to maintain that personal touch but without the costs.

5. Plan ahead

One of the best ways to minimize your travel costs is simply by planning ahead. By booking airfares, hotel rooms, rental cars, and other travel arrangements in advance, you can often get the best rates. Conversely, while in most situations you don’t want to wait until the last minute, if you aren’t pressed to be at a certain location at a particular time, sometimes you can luck out and get a great deal if flights or hotels are looking to fill planes or hotel rooms. Also, make sure you try to avoid holiday travel seasons or citywide events when rates will typically be higher.

About the author

Mark is a personal finance expert who writes for an Australian-owned website that allows Aussies to compare credit cards online such as frequent flyer cards and rewards credit cards. You can stay up to date with his writing by subscribing to their blog, The Credit Letter.