NBTA Survey: More Than Half Of Buyers Cutting Costs

More than half of 230 travel buyer respondents in a National Business Travel Association survey released today have implemented cost-cutting measures in the past several months in response to high fuel prices and the deepening economic downturn. Nine percent have undergone temporary travel freezes and 39 percent said they have reduced meetings and company events.

Meanwhile, 23 percent of respondents to the survey, which was conducted from July through September, said there has been no impact to their company's corporate travel. About 80 percent of respondents manage travel expenditures of more than $10 million.

Clearly, the rising costs of travel have exacted their toll on the need to cut back. More than 60 percent of respondents said the average cost of an international business trip increased more than $200 since December 2007. Almost 20 percent saw their average domestic trip costs rise by that amount during the same time period. On average, a domestic business trip costs $140 to $175 more than it did last year. International trips cost from $315 to $400 more than in 2007.

The survey also recorded the travel management actions taken as part of the cost savings and avoidance initiatives. Sixty percent of respondents said they have emphasized advance purchase of air tickets, which was the top action taken.

At least half of respondents said they were encouraging or requiring less air travel, sending fewer employees to conferences, strengthening mandates and enforcement of travel policies and driving people to travel alternatives.

Sematech manager of corporate travel and meeting services Bill Davidson said his company has driven airline savings through advance purchase requirements. "The biggest impact you can make is by doing advance purchasing where you can literally save hundreds of dollars and not rely on some miniscule discount you might get on a walkup fare," he said. "That's what we've been doing and continue to do. Advance purchase has the most visibility of any aspect of travel."

In some cases, less travel and broader employee cuts have wrought a reduction of the travel management workforce for 10 percent of the companies. Seventy percent said they do not fear an elimination of their positions or a reduction of the travel department.

President of travel management consultancy Management Alternatives Carol Ann Salcito said she has seen several companies cut headcount in their travel departments, including administrators and procurement areas, with some of the work outsourced to travel management companies. "I know of one procurement area where three of their subject matter leaders were let go. Now there is one subject matter leader who all of a sudden became proficient in the other three that he wasn't," she said.