Business travel budget growth could be less than initially anticipated
Monday, November 19, 2012
As the economy shows signs of recovery, many executives have speculated that business travel budgets would rise significantly in 2013. However, some organizations such as Morgan Stanley, have revised initial estimates based on new information, reports Business Travel News.
An adaptive approach
Savvy executive travel managers know that reserving corporate apartments is one of the best ways to offer business travelers unparalleled service without exceeding travel budgets. However, despite the savings offered by corporate housing, organizations like Morgan Stanley are revising their initial estimates on increases to business travel budgets.
"Executives indicated that budgets are expected to grow 1.3 percent in 2013 on a budget-weighted basis," read a report published by the financial services corporation, as quoted by the news source. "This is down from the 2.8 percent growth expectation for the forward year reported in our last survey."
Although budgets may decline in the coming year, approximately 59 percent of respondents indicated that overall bookings are likely to grow. An additional 56 percent of individuals polled said they expected airfares, particularly in business class, to increase substantially in 2013. These trends highlight the need for corporate travel managers to make smart decisions about factors such as accommodation. Serviced apartments can provide the standard that executives expect while maximizing the return on investment of tight travel budgets.
More than meets the eye
Of course, in addition to securing competitive rates on things such as business-class airfare, corporate travel managers must also make informed decisions about which carriers and service providers to choose.
Flying to a destination is a necessity for many executives. However, some carriers are more reliable than others. A recent report published by researchers at Purdue University and Wichita State University revealed that American Eagle, United Airlines and the soon-to-be-defunct Continental Airlines were among the worst carriers in terms of mishandled baggage and the volume of customer complaints.
Similarly, data from website Hopper.com suggests that Chicago's O'Hare International Airport, Washington, D.C.'s Dulles International and Houston, Texas' George Bush Intercontinental Airport were among the worst in terms of late arrivals, delays and cancellations. O'Hare has featured in a top-10 list of the nation's worst-performing airports five times, according to the news source.
Whether executives choose to stay in serviced apartments or chain hotels, this data suggests that travel managers need to make informed choices about the companies with whom they choose to do business, where their executives stay, and how to maximize the return on investment of corporate travel.