Business travel down; costs, security reasons cited
Forty percent of North American organizations have decreased their travel budgets in 2003 from 2002, and another 34% barely maintained budgetary status quo year to year, according to a joint survey by Runzheimer International in Racine County and the Association of Corporate Travel Executives (ACTE).
According to the 280 corporate travel professionals surveyed, the principal reasons for a decrease in travel budgets are fewer domestic trips taken, cited by 64%; fewer international trips taken, 59%; increased use of travel alternatives such as tele-, Web-, and video-conferencing, 56%; and use of self-directed, online booking systems, 30%.
"Corporations are restricting and limiting air travel for both financial and security reasons," notes Phyllis Schumann, senior editor, Runzheimer Reports on Travel Management, the newsletter that published the survey results. "But financial reasons carry the most weight." The No. 1 reason, by a wide margin, why organizations are limiting air travel by their employees is "corporate belt-tightening to improve profitability," cited by 81% of respondents. The depressed economy was the No. 2 reason, mentioned by 39%.
Further down the list were such factors as geo-political unrest, 13%; increased time and security procedures at airports, 7%; and increased use of travel alternatives such autos and train, 7%.
"Although an improved economy, corporate profitability and world peace were most often cited by respondents as conditions that must be present for organizations to return air travel to previous levels, many travel professionals agree that travel will never return to previous levels," according to Schumann.
"Increased use of technology, tele-conferencing, Web-conferencing and video-conferencing has gained ground and is widely accepted within many organizations," says the business travel expert. "The word ‘alternative’ as it relates to travel will eventually disappear. These technologies will simply be regarded as another business tool, just as the telephone, fax and e-mail."
For most organizations, notes Schumann, "the impact of using travel alternatives and its affect on the bottom line is unidentified. At first blush, the cost of travel alternatives versus traditional airfare and lodging costs may show significant dollar savings. What is unknown, however, is whether or not alternatives are costing you customers."
July 11, 2003 Small Business Times, Milwaukee
