How To Reduce Travel Costs In A Business


Reducing travel costs for business might seem like a challenge, especially if the majority of your employees travel to different places across the world. However, there are several ways your business can still save money by knowing where to cut back, without compromising employee safety. 

To start with, you have to have a smart travel & expense (T&E) management process in place that helps you in increasing efficiency and reducing costs. Also, it has to be a combined effort of all stakeholders involved – travel managers, finance managers, and all employees. Read on to learn some effective ways of controlling your overall corporate travel expenses.   

Top 8 Ways To Reduce Travel Costs For Your Business

Here are some tips that will not only help you reduce travel expenses but ensure your employees travel experience is efficient and stress-free:

Update your travel policy

Take a closer look at your travel policy and check if it is robust enough to cover every area of travel spend – transportation & hotel bookings, meals allowances, and any other expense employees incur during the trip (site-spending, etc.). Set out clear procedures and guidelines that help your employees make decisions within your policy limits and they don’t incur any additional costs. If you want to know how to draft a corporate travel policy that fits your business, click here.   

Encourage travel policy adoption

Controlling out-of-policy bookings is a sure-shot way to reduce overall travel spends. While there can be various reasons for your employees not being compliant with your travel policy – ineffective communication, not readable, etc; some business trips do need last-minute bookings, when the travel policies go unread. Make sure that all employees are well aware of the policy and adopt it. You can do it by:

  1. Creating simple, easy-to-understand policies – Policy adoption will only increase once the employees understand the “why” of things. So, make sure your policy is written in easy-to-understand language and highlights the advantages of following the policy clearly and prominently. 
  2. Communicating it to employees effectively – Share travel policies with employees via channels that are easily accessible. – intranet, slack, etc. You can also conduct regular training sessions, golf quizzes, and make announcements in mini gatherings regarding the travel policy to ensure 100% awareness.  
  3. Automating policies via a T&E management solution – Make sure the travel and expense management software you have or choose to have has an inbuilt policy feature that lets you present the terms of the travel policy to employees at the time of booking (the policy is right there when they actually need it!). This helps in reducing travel costs as the employee is aware of her expense limit and gets a notification if anything is booked out of policy.
  4. Providing a self-booking option – You must give your employees more freedom and responsibility to manage their corporate travel. They feel more confident, comfortable, and happy while booking the hotels or airlines they like. Integrate a T&E management system that allows an employee to book their trip within the policy limits or take approvals for extra spending. 

Have an automated pre-trip approval process

One of the best ways to reduce travel costs is to use a travel and expense management tool that completely automates your approval workflows. If there is any out-of-policy booking, the system will send an email to the manager for approval. This way, you will know if there are any out-of-policy bookings and can control them. In addition, you can set perimeters for trips that require approval. For instance, you can add a filter on any trip departing in less than 10 days and send emails to speed up the approval process.  This will help in making bookings at cost-effective rates. 

Offer incentives for staying within budget

When an employee chooses a more cost-effective or low-budget option for travel or stay, they are saving you (or your company) money. So, why not reward them for this? You can give them a voucher or a share of the savings. This improves employee experience and encourages them to keep doing it. Many T&E management solutions such as ITILITE help you incentivize your travel programs for employees and save money.

Encourage employees to plan ahead

Last-minute hotel and flight bookings can be costly. Therefore, encourage your employees to always plan at least 15-20 days ahead of their business travel. The closer the travel date, the higher will be the price of the airline or hotel. Sometimes, there are emergency cases in which you have to make last-minute bookings. And that is okay! But be smart and make sure that the trip is necessary and well-planned in advance. 

Provide access to a global inventory of flights & hotels at corporate rates

This is one of the best ways to immediately start cutting costs. Make sure the T&E management solution you have has a global inventory of hotels and flights, including low-cost airlines. You could save just by encouraging employees to book Economy flights only. 

Also, having a T&E system that shows employees options with corporate rate discounts could also help reduce travel costs. For instance, ITILITE’s innovative travel management software comes with a feature of dynamic pricing for hotels and airlines so that the system automatically compares fares and finds (and suggests) the best one for the employees. 


Apart from this, being open to alternative accommodation options such as Airbnbs can be cost-effective, especially during long stays. 

Automate reimbursement

Having a manual system of expense filing & reimbursement may lead to errors and inefficiencies. For instance, if an employee submits a consolidated bill or expense report of the entire trip for reimbursement, you won’t have any information about the additional expenses like laundry charged to the room and may end up reimbursing the entire amount. 

Automating your reimbursement process will make expense filing easy for employees and will eliminate any manual filing errors. Make sure the T&E management solution you choose has an easy-to-use mobile app to provide employees a better booking and expense filing experience. They should be able to scan and upload all the invoices on the go, eliminating all manual work. This will help with accurate expense filing, further reducing travel costs.

Find travel spending trends with advanced analytics tools

Reducing travel costs won’t be possible without understanding which part of the expense sheet needs to be paid attention to. Integrate a T&E solution or use tools with advanced analytics that gives you all travel and expense data in one place. Getting data visibility of overall travel spends will help you understand where your money is going, where exactly you are spending more than required, and control it.

ITILITE – An Effective Solution To Reduce Travel Costs 

These are just some of the many ideas that you can use to reduce travel costs. But the first one should be to have an integrated T&E management solution that automates your processes end-to-end and helps you in curbing out-of-policy bookings and late filing of claims. 

ITILITE can help you manage your travel costs effectively, achieve near 100% policy compliance, reward your employees for choosing hotels/flights within budget, and more. To know more, book a demo with our product expert today! 

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