What is the total cost of business travel? - Click Travel

Calculating the true cost of business travel is harder than you might think.

Of course, working out the total amount of money that has been spent on travel is fairly simple, but that figure doesn’t take into account the time lost whilst in transit or held up with delays, or the loss in productivity caused by jet lag or illnesses that travellers have picked up whilst on their trip.

However, Scott Gillespie, an experienced travel industry thought-leader, offers a simple equation to calculate the total cost of travel:

Total Cost of Travel = Trip cost (£) + Traveller Friction

But what is traveller friction, exactly? Put simply, it’s the ‘wear and tear’ that regular travellers accumulate over time; whether that’s from frequent periods of jet lag, time spent away from home or even bouts of illness caused by stress or lack of sleep. Traveller friction can be either exacerbated or appeased depending on how well travellers’ lifestyles are taken into consideration (for example, do they have a family?).

A more useful way of calculating the true cost of business travel could be to consider the value of the travel compared with its monetary cost. To truly work out the value of a trip you might need to speak to more than just the traveller or their line manager, as there are often more stakeholders involved who may have been inconvenienced by business travel. Here’s a quick list of people to consider:

Traveller – The welfare of frequent business travellers can suffer. This could be through physical ailments at first, often caused by poor quality of sleep and jet lag. However, on a long term basis there are more emotional ramifications due to periods of time spent away from loved ones or travelling at unsociable hours, all whilst trying to fulfil their role.

Human resources – Unsatisfactory working conditions can lead to high staff turnover and it’s worth remembering that every mid to senior member of management that needs to be replaced can cost the equivalent of 50% to 200% of their salary in recruitment cost. High turnover can also lead to more challenging recruitment due to the diminished reputation of an organisation.

Environment – Particularly relevant to organisations who pride themselves on caring for the environment, it’s worth noting that lower cost travel options often contain multiple legs and even multiple forms of transport before reaching the destination, meaning that they’re a drain on the environment as well as the traveller.

But it’s not all doom and gloom.

Some organisations have implemented well thought-out strategies to reduce their monetary travel spend, as well as avoiding secondary losses of productivity, and they’re handily listed below:

Greater flexibility in travel policy – Although giving frequent travellers more flexibility on their travel policy can mean more expense per journey, the opportunity cost of a shorter trip at a more reasonable time can dramatically increase the work-life balance of a traveller.

Giving travellers rest time – Giving travellers time in lieu to rest after a trip, or the opportunity to turn their trip into bleisure, are effective ways to improve a traveller’s job satisfaction.

Video calls – Technological advances mean that we no longer have to travel to each and every meeting in order to get some face time with clients; we can easily hook into a video call and avoid taking a hit in productivity.

Meet in the middle – If you really do need to have a face-to-face meeting, but it doesn’t necessarily have to be in the office then why not meet in a fresh environment that’s easy to get to for both parties? For example, if one party is from Birmingham and the other is in Southampton, meeting in London would be a workable solution for both. Removing yourself from your usual environment can actually boost productivity too!

Use your travel management account managers – If you’re currently using a travel management company, then work with your account manager to build relationships with the stakeholders involved (HR, finance, directors and travellers themselves) to create an improved travel policy and budget. Account managers can also build up relationships with hotels to agree on corporate rates. This can be beneficial to travellers as using a familiar choice of hotels comes with a level of consistency and comfort, both of which can reduce the stressful effects of travelling.

As with a lot of things in life, it’s not just about the money.

There is an increasing push within the business travel industry to put employees and their welfare at the centre of travel management, with organisations taking greater responsibility when it comes to delivering duty of care. When it comes to calculating the true cost of business travel talking to your travellers, rather than scouring your spreadsheets, can prove to be much more helpful.{{cta(‘2e99ae69-07d1-490a-a00a-64c4025a462d’)}}

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Sergio Cabrera-Howell