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Business travel costs
Business travel is, for many organisations, vital to their success. We recognise that and are in no way anti-travel, anti-car or anti-flying. Responsible business travel is good for business and good for the economy. Developing a responsible business travel policy can bring significant costs savings and wider business benefits.
The most obvious costs of business travel will be fleet operating costs (for those organisations that have them) and those that go through as expenses claims – so car mileage, train and plane journeys, taxis, hotels, general living expenses and entertaining. But this is just the tip of the iceberg. Under the surface there are the hidden costs of staff time spent travelling on business. On top of this comes the cost to UK businesses of delays and unreliability due to congestion, estimated at over £20 billion pounds annually (BCC: The Congestion Question).
High reimbursement rates for business mileage can lead to a corporate culture of driving everywhere. It is a challenge to change this kind of culture once it is established, but for organisations that have developed this pattern of inefficient expenditure it can provide a basis for a business case for influencing more sustainable travel alongside travel reduction policies and strategies.
If the impact on the balance sheet is worse than it first appears, the same is true of the impact of travel on the environment. Climate change is now seen as a core driver of corporate social responsibility strategies, recognising shareholder concerns that this is an unavoidable and pressing issue. Transport is the fastest growing source of greenhouse gas emissions, and commuter and business travel constitute nearly 40% of miles driven by car. Measures to reduce excessive vehicle use are vital for any business that seeks to make its operations more sustainable. Not dealing with this issue can affect a company’s reputation and potentially lead to a loss of business.
E.On’s introduction of telepresence in 2009 saved £142,814
In Unilever’s first year of using telepresence total cost savings of £3 million were made
Focus Consultants in Nottingham had 9% less business car mileage saving £219 costs per employee through their sustainable business travel policy
Microsoft reduced air travel by 21% during the past 3 years by using technology and flexible working
BAT in its first 7 months of using telepresence had £2.3 million savings on management time and £1.8 million in cost savings through travel avoidance