You might be looking for expenses that you can reduce while you work on your company’s budget for the coming year. Your trip budget is one item that can tempt your cost-cutting. After all, how much value are you really getting for your business travel dollar when there are so many free or inexpensive web-based alternatives available for anything from client meetings to employee training?
So, what are the advantages of business travel, and how can businesses make sure their investment is profitable?
What Is the ROI of Business Travel?
Simply expressed, return on investment (or ROI) is a performance measure used to assess an investment’s effectiveness. It measures the amount of return (or benefit) received in relation to the investment’s cost. Business travel may be seen as a capital expenditure that “is expected to produce advantages to corporate productivity,” according to the white paper from Oxford Economics USA.
Despite being a phrase used in finance, return on investment (ROI of business travel) in the context of corporate travel management refers to the possibility to forge relationships with diverse groups that are related to the company’s profit and loss. Technology advancements have transformed every aspect of business, from emails to conference calls, in the world we live in.
What Advantages Can Corporate Travel Provide To A Business?
1. It Facilitates Gaining New Clients
When it comes to gaining clients, nothing quite compares to in-person interactions. According to reports from Oxford Economics USA and the World Travel & Tourism Council, business travelers and corporate leaders predict a greater conversion rate following an in-person meeting.
Many people won’t likely be surprised by this claim. Even after a few Zoom meetings, it’s obvious that reading body language and other non-verbal clues make it much simpler to establish trust and negotiate conditions.
Investment in business travel will remain essential for this reason alone, especially when trying to complete significant agreements.
2. It Is Important For Maintaining Professional Connections
But as we all know, running a business involves more than just bringing in new customers. Maintaining consumer relationships also requires face-to-face communication. Most of the time, a phone call simply isn’t sufficient for everything, including polite check-ins and resolving any difficulties.
To show appreciation and a level of respect for the partnership, take the time and bear the expense of travel to meet with clients in person.
According to surveys, corporations ultimately lose money when they try to decrease the costs of business travel. Executives predicted that if they stopped holding in-person meetings, up to 38% of their clients may switch to a rival, costing them 37% less in annual revenue.
3. It Offers Chances To Network
Business travel promotes collaboration and relationship building within a larger industry environment in addition to the advantages of team building within your company. Professionals can stay current on new advancements while networking with potential clients or establishing new relationships by attending conferences and trade events.
According to a report by Oxford Economics USA, up to 20% of survey respondents said they acquired new clients as a result of attending trade fairs, and 48% said that finding new vendors was another important reason they attended.
4. It Acts As a Motivating Factor
Business travel can serve a variety of purposes, as we’ve already seen. How employees gather together is evolving as more businesses adopt remote or hybrid working arrangements.
The time when hot startups were the only ones eligible for regular offsite incentives is long gone. To take advantage of our new normal, more and more firms are constantly revamping their internal meetings.
Bringing together teams from various locations in a motivating location might meet a variety of business needs. Remote working teams can be re energized and fresh ideas can come to the fore by combining crucial updates, in-person brainstorming sessions, and a few enjoyable team-building activities in new environments.
5. It Has Global Effects
According to a 2020 Harvard University study, travel has significant effects on whole countries in addition to its advantages for specific enterprises. A country’s GDP and the volume of incoming business travelers are positively correlated, according to research done with the MasterCard Center for Inclusive Growth.
This economic expansion was ascribed to both tourists’ domestic spending and the “know-how” that was disseminated by business travelers and assisted industrial operations in becoming more profitable. Even the potential effects of stopping business travel between particular nations were calculated by the poll.
As a result of all these advantages, both small-scale and large-scale, business travel is probably here to stay. The Global Business Travel Association (GBTA) has predicted that business travel spending will return to its per-pandemic levels by 2024, a year faster than projected, despite the availability of technology like Zoom and Skype.