9 sensible ways to reduce business travel expenses

Updated November 2024 - Business travel is a cornerstone of growth - whether it’s attending client meetings, industry conferences, or team-building retreats. It’s often seen as a valuable investment in relationships and opportunities. But with that investment comes significant costs.

Flights, accommodation, meals, and other travel-related expenses can quickly spiral out of control, leaving finance teams grappling with ballooning business travel budgets. The good news? Reducing business travel expenses doesn’t have to mean sacrificing quality or employee satisfaction. Instead, it’s about adopting smarter strategies that align with your business travel policy and financial goals.

Here’s How to reduce travel expenses while empowering your team and maintaining a seamless travel experience.

Why managing travel expense costs is critical for modern businesses

Business travel is an essential part of operations for many organisations, from attending client meetings to participating in conferences and team-building activities. While these trips play a crucial role in building relationships and driving growth, they often come with significant costs, which can quickly add up, making travel one of the largest controllable expenses for businesses.

For finance teams, unchecked business travel expenditures can strain budgets and disrupt cash flow, creating challenges for forecasting and long-term financial planning. Mismanaged corporate travel budgets also impact employee satisfaction, especially when unclear policies or outdated processes leave staff covering costs out of pocket or facing reimbursement delays.

A well-structured approach to managing business travel costs can prevent these issues while enhancing the travel experience for employees. By prioritising cost control without sacrificing comfort or efficiency, businesses can strike a balance between supporting team productivity and safeguarding company money.

Typical challenges businesses face with travel expenses

Despite their importance, travel expenses often fall into a grey area where inefficiencies and overspending thrive. Here are some common issues businesses encounter, and how addressing these with the right tools and policies can lead to better outcomes:

1. Lack of visibility into travel spending

Without real-time expense tracking, finance managers may struggle to understand the true cost of business travel. This makes it harder to identify opportunities for cost savings or highlight unnecessary spending.

2. Inconsistent policies

Vague or outdated corporate travel policies can leave employees guessing about allowable expenses. This often results in overspending, policy violations, or even accidental non-compliance with tax regulations.

3. Time-consuming processes

Managing expense claims, reconciling receipts, and dealing with fragmented travel bookings consume valuable time for both employees and finance teams.

4. Fraudulent or duplicate claims

Inadequate oversight can open the door to fraudulent claims or duplicate expense submissions, which inflate overall business travel costs.

5. Disjointed tools and systems

Many organisations still rely on spreadsheets and manual approval workflows, which hinder efficiency and lead to errors in reporting.

Modern solutions, like expense management software and corporate travel management platforms, address these pain points by simplifying workflows, offering real-time visibility, and ensuring compliance with company policies. Tools like Weel provide a comprehensive approach to managing travel expenses, enabling businesses to control costs while empowering employees to make smarter spending decisions.

How to reduce business travel expenses

With the right strategies, it’s possible to reduce travel costs without compromising the quality of the travel experience. Here’s how businesses can achieve cost savings while streamlining their travel processes:

1. Strengthen Your Corporate Travel Policy

A well-crafted travel policy is the foundation for managing corporate travel expenses effectively. It creates clarity, sets expectations, and provides guardrails for your team.

For example, should employees fly Economy or Business Class? What’s an acceptable daily allowance for meals? Establishing these guidelines ensures that employees make cost-conscious decisions while travelling, minimising overspending and fraud.

Once you’ve reviewed and updated your policies, make them easily accessible. When employees understand what’s permitted, they’ll spend company money more responsibly.

Need a starting point? Our travel expense policy template can help lay the groundwork for success. Click here to download.

2. Implement Approval Workflows

Clear approval processes are essential to cutting business travel costs. By requiring employees to submit plans for major expenses—like flights, accommodation, or event tickets—before booking, you can avoid last-minute surprises.

Automating approval workflows can save valuable time and ensure compliance with your travel policy. Simple, intuitive systems allow finance teams to focus on more strategic tasks rather than micromanaging travel expenses.

3. Leverage Corporate Cards for Seamless Transactions

Corporate cards streamline travel bookings and eliminate the need for cumbersome reimbursement processes. Virtual cards, in particular, offer a smarter, safer way to manage travel spend.

Virtual cards allow you to set spending limits, track expenses in real time, and assign unique cards to individual employees or teams. This level of control reduces risks like fraud and overspending while improving cash flow visibility.

4. Book Early for Cost Savings

Advance bookings often lead to the biggest savings on air travel and accommodation. Encourage employees to plan ahead by implementing a policy that requires bookings at least two weeks before travel.

Consider corporate agreements with hotel chains to lock in competitive rates and secure perks like flexible cancellations or loyalty rewards. For greater savings, compare rates across multiple platforms to ensure you’re getting the best deal.

5. Optimise air travel

Air travel often accounts for a significant share of business travel expenses, but strategic planning can help control costs without compromising the travel experience:

• Book mid-week flights: Flights on Tuesdays, Wednesdays, or Saturdays are typically cheaper than peak travel days like Mondays and Fridays.
• Encourage Economy or Premium Economy: Economy is cost-effective for shorter trips, while Premium Economy offers comfort at a lower cost than Business Class for longer flights.
• Travel light: Sticking to carry-on luggage not only avoids baggage fees but also reduces delays caused by lost luggage.
• Leverage corporate booking tools and rewards programs: Platforms like Egencia or TravelPerk provide discounted airfares, while frequent flyer and corporate rewards programs can deliver long-term savings. Pair these with Weel’s virtual cards for seamless expense tracking.
• Choose alternative options for savings: Consider budget airlines or connecting flights when practical, and look into regional airports for lower fares. These options often come with trade-offs but can result in significant cost reductions.
• Bundle bookings and track trends: Combine flights and hotels into package deals or use tools like Google Flights and Hopper to monitor airfare trends and book at the right time.
• Negotiate directly with airlines: For businesses with frequent travel needs, corporate agreements can unlock exclusive rates and perks.

By combining smart planning with digital tools, businesses can significantly reduce their air travel costs while keeping employees comfortable and productive.

6. Partner with a Travel Management Company

Travel management companies (TMCs) can handle the complexities of business travel, from negotiating corporate rates to managing last-minute bookings. While there’s a cost involved, the savings on airfare, accommodation, and time can be well worth it - especially for frequent travellers.

7. Set Realistic Travel Allowances

Cost savings should never come at the expense of employee well-being. A thoughtful corporate travel policy includes realistic daily allowances for meals and incidental costs.

Flexibility is key: allow employees to allocate their travel budget as needed, whether for a team lunch or an upgraded experience. When employees feel valued, they’re more likely to respect company resources.

8. Digitalise Receipts for Expense Tracking

Manual expense tracking is inefficient and error-prone. Instead, embrace tools that allow employees to submit receipts digitally, saving time for both travellers and finance teams.

Solutions like Weel simplify the process by prompting employees to upload receipts immediately after purchases, reducing delays and errors in expense claims. This real-time visibility streamlines expense management and ensures compliance with your travel policies.

9. Automate Business Travel Expense Management

Travel and expense management software is a game-changer for controlling corporate travel costs. Tools like Weel integrate with accounting platforms such as Xero, providing real-time transaction feeds and automated expense tracking.

With Weel, you can generate accurate reports, monitor travel spend across teams, and even enforce budget controls at the point of purchase. This proactive approach transforms expense management from reactive to strategic, helping finance professionals save time and cut costs.

The Bottom Line

Business travel doesn’t have to break the bank—or your team’s morale. By adopting smarter strategies like streamlining your corporate travel program, optimising booking processes, and leveraging the right tools, you can cut business travel costs while delivering a seamless, enjoyable experience for employees.

With comprehensive expense management software, such as Weel, you gain more than just cost savings; you unlock real-time visibility, streamlined expense tracking, and automated workflows that keep your travel spend under control. Our innovative tools empower finance teams to simplify processes, prevent overspending, and stay aligned with company goals—without adding administrative headaches.

Take the first step toward smarter travel expense management. Book a demo with Weel today, or explore our solutions through a quick product tour to see how easy managing corporate travel costs can be.