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Anne Arundel Business Break

Businesses looking to cut travel expenses

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Published April 24, 2008
Lee White, an Eastport business owner who regularly meets clients in the Washington, D.C., area, used to spend a $70 a week to fill up his silver 2003 Volkswagen Passat.
Now, the owner of TSI zooms around in a Honda Fit, a slick compact car he can fill up for less than $30, he said.

"It's so efficient and I'm probably filling up once every 10 days," said Mr. White, whose company resells technology to contractors such as Northrop Grumman and Lockheed Martin. "Relatively speaking, it's paying for itself."

Company owners such as Mr. White are seeking ways to cut business travel costs as gas prices creep toward $4 a gallon, travel experts said.

Caleb Tiller, spokesman for the National Business Travel Association in Alexandria, Va., said some businesses are switching hotel nights to lower-priced properties while others are setting up internal travel departments to manage costs.

Although businesses have been cutting travel costs over the past five years, the gloomy economy has heightened awareness about the need to save now, he said.

"A broader swath of our membership is looking at how they may need to adjust their travel programs in the future if the downturn is extended or deeper than what people may expect," Mr. Tiller said.

Several local experts offered ways to help businesses lower costs beyond the airport checkpoint. For example, companies can adopt the Joint Federal Travel Regulations that list allowable travel expenses for people employed by the government.

Ruby Degenhard, owner of Best Connection Travel in Annapolis, said, for example, the current regulations allow government workers to only spend $119 on a hotel night in Miami. If private companies follow these guidelines, they can prevent employees from spending money on lavish hotels.

"They are using these guidelines or adopting them as their standards for reimbursing costs for travel," she said.

Keeping business travelers safe also can lower costs. If employees are "sick, injured or inconvenienced" while traveling, their production is dramatically affected and that costs a company money, said Stephen Hoffman, chief executive officer for iJET, an Annapolis travel risk-management firm that monitors terrorist threats and geopolitical events for corporate and government organizations.

Companies such as iJET can keep track of business travelers, identify affected employees and direct them to safety, Mr. Hoffman said. He also said iJET can help business travelers avoid major construction delays or disasters such as the Minneapolis bridge collapse, he said.

Traveling today means long lines and flight cancellations among other time-wasters that cost companies big money and more time off the clock. Becky McLaughlin Treakle, whose company Personalized Travel Consultants merged with Best Connection Travel, said arriving at the airport early is more important than ever for business travelers, whose schedules are more apt to change. Business travelers who don't arrive soon enough run the risk of losing their seat to someone whose flight has been canceled.

"You have to be there to claim your seat or they will give it away," she said.

To avoid wasting time and money, Ms. McLaughlin Treakle said travelers should look up an alternate air carrier headed to their destination or consider renting a car if they are going to a drivable destination. In addition, business travelers should always confirm flights 12 to 24 hours before walking through the airport gates, she said.

"That's an advantage of still using a travel agent, we are constantly reconfirming for that cancellation," she said.

Although businesses are cutting back on costs, companies are still expected to spend $200 billion on business travel in the U.S. alone, part of a steady uptick since 2004, Mr. Tiller said. Business travel dropped during the economic downturn prior to the terrorist attacks of Sept. 11, 2001, which caused travel to sink even more.

One of the best ways to manage travel costs is by having a centralized system in which travel professionals track and book flights and negotiate better discounts based on volume, Mr. Tiller said. "You can't do those things if you don't have all your travel data together," he said.

Mr. White doesn't have to worry about an in-house booking system, but he is saving plenty of money with the Honda Fit he bought last summer for $15,500 in part for safety reasons. (The Honda Fit has six airbags.) He also picked the car because of its great fuel economy, saying he can now drive from his home in Laurel to Raleigh, N.C., on one tank of gas.

"It does what a $30,000 car does for half," he said.

Besides the benefits of lower fuel costs, Mr. White said he also gets plenty of compliments on the Honda Fit, from teenagers to members of an older generation.

"It's a car that is hip and at the same time it's efficient," he said.

- No Jumps-

 

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