Companies Are Moving Quickly to Track Ancillary Fees
Only 21% of travel managers are tracking ancillary fees, but many more plan to start doing so within the next year. Those that do track ancillaries report that the category accounts for 8% of total travel spend. Where are they getting their info? About eight in 10 (81%) get ancillary data from internal reporting systems, 53% from corporate card systems, and 23% from travel management companies. Of the companies that don’t now track ancillary fees, 41% plan to start tracking within the next 12 months. Source: 2011 Corporate Travel Policy Benchmarking and Insight report, Global Business Travel Association Foundation and Egencia
Ill-Defined ‘Other’ Comprises 25% of Travel Spend
T&E is the number two controllable spend for most companies, just behind payroll. But the typical company can’t account for a quarter of its travel spend. The first T&E Spend Report from Concur revealed that the largest expenditure category for T&E is the unclassified “other” category – it eats up 25% of total spend. That’s more than air (23%) or hotel (19%), or dining (10%). Behind those are: ground transportation (5%), entertainment (5%), personal car (4%), car rental (3%) telecom (3%), office supplies (2%) and training (2%).
Simplicity Is Key to Policy Compliance
“Make compliance easy for them and your travelers will do the right thing.” – Tony D’Astolfo, senior vice president, Travel Services, Rearden Commerce
Hotel Construction at Near-Record Lows
Hotel construction remains near all-time lows, and supply won’t be easing up any time soon, according to data from Smith Travel Research and Lodging Econometrics. Even though demand is picking up, it takes around three years for new construction to move through planning and construction. New construction will bottom out this year and into 2012, said Bobby Bowers, senior vice president of operations at STR. He predicted a construction rebound starting in 2013. But no real bump in supply is likely to arrive until the middle of the decade, said Lodging Econometrics president Patrick Ford. A July survey by STR found a 10% drop in hotel construction from a year earlier, with only 54,825 rooms in the pipeline.
London 2012: Plan Workarounds for Hectic Olympics Season
The Olympic Games in London are shaping up to be a monumental travel headache. Some hotels have upped their rates by 500%, and air traffic and prices are expected to surge as well. BCD Travel had one word of advice for companies considering sending travelers to London in July and August, 2012: Don’t. In fact many firms are banning or severely restricting travel to the U.K. during the Olympics. For unavoidable travel, think outlying cities such as Oxford or Milton Keynes, an hour from London by train. This is also the time to talk to suppliers early to lock in rooms and rates. And take a look at extended stay alternatives. Some brands see the Olympics as an opportunity to lure corporate business from their traditional hotels.
For Road Warriors, the Workday Never Ends
Business travelers have long griped that the work day never really ends when they are on the road. A new report from Accor backs those complaints. More than 75% of business travelers in the Asia-Pacific region said they worked in their hotel rooms, according to Accor’s survey of more than 10,000 business travelers. Many are skipping entertainment and relaxation options to stretch the workday, with 35% working between 6 p.m. and 9 p.m. and 52% working between 9 p.m. and midnight.
How Biz Travelers Are Paying
Business traveler use of company credit cards is still not where travel managers would like it to be, judging by Concur’s recent review of expense report data. Airfare went on the company credit card 83% of the time. But airline ancillary fees were charged to company plastic just 19% of the time. Dining charges went on the company card 60% of the time, but personal cards and cash remained popular. Purchasing outside the company card program may help travelers earn points and rewards on their personal cards, but it also invites more creative accounting. So maybe it’s no surprise that employees are taking longer to submit expense claims, an average of 21 days, compared to 16 days last summer. Concur took a fresh look at its data recently at the request of the Wall Street Journal.
. . . and What They’re Spending It On
Business travelers spend an average of $39 when they eat alone on the road, according to Concur. Travelers who expense airline fees spend an average of $49 for alcohol, meals, Internet access, and entertainment. Upgrades, baggage fees, preferred seating, and airport clubs were broken out separately.
EMD Use for Ancillary Fees Gains, Slightly
A week after the Airlines Reporting Corp. touted the first use of an electronic miscellaneous document, or EMD, to pay an ancillary fee for an American Airlines flight, another travel agency made use of the new document. Frosch Travel used the EMD to cover ancillary fees on Air New Zealand, processed through Sabre. ARC has been pushing carriers, travel agencies, and business travel providers to use the EMD since 2010. No word yet on EMD adoption in the business travel world.