What’s next for Business Travel?

Thursday, September 24, 2020

A panel of six travel procurement experts shared their views on the world of business travel and the impact of Covid-19 at a recent CASME event.

This panel discussion was put on following requests from CASME’s procurement community to explore the current issues around the business travel category.  Unsurprisingly, the elimination of travel spend for most of this year  has yielded significant savings  – companies reported that changes in demand have seen spend plummet by 75 – 95% of 2019 levels, as companies banned travel from March 2020 onwards.

Since that time, depending on where in the world you are located, there has been some easing of the ban. but some tough new internal regulations have come into force. For most companies, international travel is still not allowed. Travel within Europe and domestically in the US may be necessary for engineering and service requirements. Yet travel for internal meetings and conferences has stopped entirely, with virtual applications introduced to meet all business requirements.

Policies have been tightened with very senior approval now necessary to allow employees to travel.

Poll Results

Over 80 procurement executives attended the panel discussion with a series of online polls revealing the following results:

  • 35% of organisations have a travel ban in place
  • 68% of respondents stated that higher levels of travel authorisation are now required
  • 83% indicated that Supplier Relationship Management (SRM) programmes have been either effective or highly effective during the pandemic
  • When sourcing travel, 50% said that the company will be providing a greater focus on the safety of travellers.

Top tips for business travel going forward:

  • Relationships are key – keep talking to your major suppliers
  • Hold off on issuing RFPs for hotel nights if you are uncertain what your demand is going to be
  • Your hotel policy should aim to secure both fixed rates and dynamic pricing
  • It is advisable to look at whether change fees and name change fees can be waived for airline bookings. Work closely with the airlines, they need your collaborative support as this difficult time.
  • Establish improved connectivity of systems, especially data sharing between traveller security systems and Travel Management Companies (TMCs)
  • Consider whether a transaction fee-only model is no longer relevant for contracting with TMCs
  • Use the tightening travel policy to ensure all spend is channelled to preferred suppliers.

It is likely that the Business Travel Category will continue to be one of the most impacted indirect procurement categories to manage. Procurement must remain agile and work with suppliers to react to business needs.

The recording from the Business Travel and Covid-19 Panel Discussion will subsequently be made available to all CASME subscribers via the member-only Resource Centre. Procurement teams can review these collective insights and develop best practice in a frequently changing world. 

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