Corporate travel in Australia most expensive in the world

by Cameron Edmond24 Jul 2013

Following from yesterday’s report on Sydney’s cost to expatriates, Brisbane has been found to be the most expensive city for business travel, followed closely by Sydney, Perth and Melbourne, a report from Concur uncovered.

The report, which focuses on corporate travel and entertainment (T&E) expenses, aggregated expense report data for 2012, covering a wide breadth of anonymous information from companies and individuals.

The Concur Expense IQ report uncovered that Brisbane hotels cost US$305.05/night on average, in comparison with New York where a hotel room costs and average of US$194.62/night.

Additionally, a meal in Australia is, on average, US$70, compared to Paris – a city known for its culinary expenses – that averages at US$49.

Poor exchange rates, as well as higher prices on the average meal, has meant organisations are reluctant to spend when traveling to Australia, reducing T&E budgets.. However, logistical expenditure – such as ground transportation and lodging – has increased.

Of interest is the worldwide shift towards ‘close to home’ T&E expenditure, in which clients and employees involved in meetings or conferences are provided transport to nearby accommodation,  and then using video conferencing to connect. This ‘telepresense’ has resulted in an overall dip in airfares, meals and entertainment, while personal car and hotel expenses dropped the least.

SMEs have greater expenditures compared to larger companies, with more frequent transactions. Concur believes this underscores the need for organisations to have deeper understandings of T&E so they can better negotiate prices, policies and efficiencies.

Concur stated that T&E is often the most poorly managed category of expenditures, and companies must move towards measuring and benchmarking their spending patterns against trends, providers and other organisations.

 

Key HR takeaways

Concur provided their tips on how organisations can manage their T&E expenses more effectively:

 

  • Review historical spend data: This information can equip organisations for more informed decisions about how to shape policies.

 

  • Talk to peers and industry experts: Talking to other organisations or professionals can help organisations to pinpoint where they sit in comparison, and make them better negotiators.

 

  • Consider company culture: What sort of spending is within policy? A set of core guidelines will help illustrate to employees what is and isn’t acceptable.

 

  • Secure executive support: Ensuring key stakeholders are involved in the implementation stages can make the difference between initiatives having no impact, or a lot of impact.

 

  • Evaluate providers: Providers are a pivotal part of this process, and they must understand an organisation’s unique needs, and have adequate solutions that can scale with the business.

 

  • Negotiate: Utilising sources such as Concur, as well as all other information gathered, organisations must ensure they are entering negotiations informed and with clear goals in mind.

 

  • Utilise automated policy enforcement: Using systems such as Concur, all information and procedures can be locked in from reservation through to payment, to ensure your policies and conditions are met. This is also much easier to measure.

 

  • Look for new offerings: Mainly targeted at SMEs, but still important for larger organisations. There may be business-travel programs aimed at specific organisations, and these should be accessed where applicable.

 

  • Benchmark: The importance of benchmarking cannot be exaggerated, especially for organisations who haven’t been measuring T&E sufficiently in the past.

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