BUYERS HEAD INTO THE NEW YEAR FACING CONTINUED PRESSURE TO CUT COSTS FOR THE THIRD YEAR RUNNING

As we head into another new year, corporate travel buyers are, once again, facing the pressure to cut costs and maintain quality. Oh yes, it's that time again, when the Business Travel Show buyer survey flags up the pain points for buyers in the next 12 months. 

Business Travel Show event director David Chapple 

The poll of 243 business travel buyers asked, “What is the biggest issue facing you over the next 12 months?” Cutting costs reigns top of the list for the third consecutive year, followed by an increased focus on duty of care for the second time in a row.

In third place (up five from last year) is rising hotel rates and, more specifically, availability. Rising airfares is at number six, a drop of three positions. Brexit – a new entry on the table in 2017 – features again in fourth place. Enforcing compliance continues to freefall down the table, from second place in 2016, to fifth last year and seventh for 2018. Unsurprisingly, GDPR – which comes into force next May – features on the list for the first time in tenth place.

It’s not surprising to see cost cutting and duty of care as the top two challenges facing buyers over the next 12 months, especially given the recent spate of terrorist attacks across Europe and further afield; it’s simply not an opportunity for buyers to ignore traveller risk anymore, it must be a priority for them, their organisations and their partners.

Buyers have been so vocal about the debate around hotel availability this year that it was also not unexpected to see the issue around hotel rates rate so highly. But I was a little surprised to see Brexit so high on the table, given that many people feel the initial instability it caused for corporate travel was short-lived and the after effects will remain somewhat of an unknown until March 2019 at the earliest.

Additionally, when asked the follow up question, “What will the biggest change in the way you buy/manage travel in the next 12 months be?” buyers responded as follows.

1.     No change   

2.     Increased use of technology                  

3.     Change TMC                 

4.     Increased online bookings

5.     Increased compliance

6.     Brexit

7.     Pressure to reduce costs        

8.     Engage a TMC

9.     Direct bookings

10.  Consolidate suppliers

11.  Value for money

12.  Find a new travel and expense tool

13.  Increased focus on safety

14.  Reduce travel

15.  Managing with a reduced budget

The Business Travel Show is the leading event in Europe for corporate travel professionals, taking place 21-22 February 2018 at Olympia London. Buyers can register for a free visitor pass at www.businesstravelshow.com/register. 

Buyers with a minimum annual spend of £1 million can also apply to attend as a hosted buyer at http://www.businesstravelshow.com/hosted-buyers.

GUEST BLOG: The UK is flying.

Now in it’s eleventh year, the AirPlus International Travel Management Study asks travel managers in no fewer than 24 countries how they view business travel prospects for the 12 months ahead. For the first time we have sought the views of business travellers too.

It turns out the opinions of both groups are remarkably similar. For example, 36 per cent of both UK travel managers and travellers expect more trips in 2016, while 5 per cent of travel managers and 8 per cent of travellers think there will be fewer. Likewise, 44 per cent of UK travel managers forecast higher travel spend in 2016, as do 40 per cent of travellers.

A year of optimism – but watch out for costs

Another consistent picture to emerge is that British travel managers and travellers are well ahead of their peers in Western Europe and even globally in expecting more trips (and more spend) in 2016. Since business travel and GDP growth are strongly linked, these findings are consistent with the UK economy outperforming most other industrialised nations over the past year.

Expansion of business activity is welcome news, of course, but no company wants to see its travel spend spiral out of control as a result. Quite rightly, UK travel managers identify hotels as their biggest area of cost concern this year. Air fares are largely stable at present, thanks in part to low oil prices, so I expect to see travel managers making accommodation their number one supplier management objective in 2016. Tighter policy control, better use of corporate payments and a drive for more detailed hotel data are all likely to be on the agenda.

Managing cost while maintaining quality will undoubtedly be an issue this year, but there are plenty of good tools – and talent – available to tackle this critical challenge for travel managers.

To get your copy of the International Travel Management study, visit us on stand B430 at the Business Travel Show 2016. AirPlus is a leading specialist in corporate payment solutions.With 25 years experience we offer products to over 40,000 customers worldwide including corporate cards, centrally billed accounts, virtual card solutions and expert reporting tools.