reduce travel costs

Reducing travel costs for business might seem like a challenge, especially if your employees travel to different places across the world. However, there are several ways you can save on business travel by knowing how to reduce the business travel cost without compromising employee safety.

To start with, you have to have an advanced travel & expense (T&E) management process in place that helps you increase efficiency and reduce business travel costs. Also, it has to be a combined effort of all stakeholders involved – travel managers, finance managers, and all employees.

By implementing cost-saving measures like booking in advance, using travel rewards programs, and negotiating with suppliers, you can start to see real savings on your corporate travel expenses.

To estimate your potential savings on corporate travel expenses by implementing cost-saving measures, try using our savings calculator.

Read on to learn some effective ways of controlling your overall business travel expenses.   

How to Reduce Travel Costs on Business Travel

Here are some tips that will not only help you reduce business travel costs but also ensure your employees’ travel experience is stress-free.

1. Update your Travel Policy

Take a closer look at your corporate travel policy and check if it is robust enough to cover every area of travel spend – transportation & hotel bookings, meal allowances, and any other expense employees incur during the trip (site spending, etc.).

Draft a corporate travel policy with clear procedures and guidelines that help your employees make decisions within your policy limits and they don’t incur any additional costs.

2. Encourage Travel Policy Adoption

Controlling out-of-policy bookings is a sure-shot way to save on business travel. There can be various reasons for your employees not being compliant with your travel policy, such as ineffective communication, complicated policy, etc. Make sure that all employees are well aware of the policy and adopt it.

You can do it by:

Creating Simple, Easy-to-Understand Policies

Policy adoption will only increase once the employees understand the “why” of things. So, make sure your policy is written in easy-to-understand language and highlights the advantages of following the policy clearly and prominently. 

Communicating it to Employees Effectively

Share travel policies with employees via channels that are easily accessible. – intranet, emails, etc.

You can also conduct regular training sessions and quizzes regarding the travel policy to ensure 100% awareness.  

Automating Policies via a T&E Management Solution

Businesses need to understand how to reduce the business travel cost to manage their budgets more efficiently.

This helps in reducing travel costs as the employee is aware of her expense limit and gets a notification if anything is booked out of policy.

Providing a Self-Booking Option

You must give your employees more freedom and responsibility to manage their corporate travel. They feel more confident, comfortable, and happy while booking the hotels or airlines they like.

Integrate a T&E (travel and expense) management system like itilite that allows an employee to book their trip within the policy limits or take approvals for extra spending. 

Suggested Read:

7 Ways to Ensure ROI When Traveling for Business

3. Have an Automated Pre-Trip Approval Process

One of the best ways to reduce business travel costs is to use a travel and expense management tool that completely automates your approval workflows. For instance, if there is any out-of-policy booking, the system will send an email to the manager for approval.

In addition, you can set parameters for trips that require approval. For instance, you can add a filter on any trip departing in less than 10 days and send emails notifying the manager of the same. This will help in making bookings at cost-effective rates. 

4. Offer Incentives for Cost-Efficient Booking

Knowing how to cut business travel costs can significantly impact your company’s bottom line. When an employee chooses a more cost-effective or low-budget option for travel or stay, they are saving the company money.

So, why not reward them for this? You can give them a voucher or a share of the savings. This improves employee experience and encourages them to keep doing it.

Many travel management software solutions help you incentivize your travel programs for employees and save money.

5. Encourage Employees to Plan Ahead

Last-minute hotel and flight bookings can be costly. Therefore, you should encourage your employees to always plan at least 15-20 days ahead of their business travel. The closer the travel date, the higher will be the price of the airline or hotel.

Sometimes, there are emergency cases in which you have to make last-minute bookings. And that is okay! But be smart and make sure that the trip is necessary and well-planned in advance. 

6. Provide Access to a Global Travel Inventory

This is one of the best ways to immediately start cutting business travel costs. Make sure the T&E management solution you choose has a global inventory of hotels and flights, including low-cost airlines.

Also, having a T&E system that shows employees options with corporate rate discounts could also help reduce travel costs.

For instance, itilite’s innovative business travel management comes with a feature of dynamic pricing for hotels and airlines so that the system automatically compares fares and finds (and suggests) the best one for the employees. 

Global inventory

Apart from this, being open to alternative accommodation options can be cost-effective, especially during long stays. 

7. Fix Cost Leakages with Virtual Travel Consultant

Reducing business travel costs won’t be possible without understanding which part of the expenses needs attention. Hence, you should invest in a T&E solution that offers advanced travel data insights. Some advanced solutions, like itilite, provide a virtual travel consultant- Mastermind.

This AI-powered consultant analyzes your company’s past travel data to identify cost leakages, conducts industry benchmarking, and suggests actionable steps you can take to save on business travel.

8. Automate Reimbursement

Having a manual system of expense filing & reimbursement may lead to errors and inefficiencies. For instance, if an employee submits a consolidated bill or expense report of the entire trip for reimbursement, you won’t have any information about the additional expenses like laundry charged to the room and may end up reimbursing the entire amount. 

Automating your reimbursement process will make expense filing easy for employees and will eliminate any manual filing errors.

Moreover, they should be able to scan and upload all the invoices on the go, eliminating all manual work. This will help with accurate expense filing, further reducing travel costs.

Reduce Travel Costs with Technology 

We hope this blog helped you understand how to cut business travel costs. These are just some of the many ideas that you can use to reduce travel costs. The revenue saved from identifying cost leaks and optimizing the travel budget can be utilized in other core processes.

itilite is a corporate travel management software that helps you manage your travel costs effectively, achieve near 100% policy compliance, reward your employees for choosing hotels/flights within budget, and more.

Try itilite to know how it helps in reducing travel costs.


1. How to cut business travel costs?

You can cut business travel costs by negotiating volume discounts with preferred vendors, implementing strict travel policies for cost-effective bookings, and utilizing technology tools to monitor spending. Further, you can partner with a travel management company to optimize the use of travel expenses.

2. How to calculate business travel costs?

You can calculate business travel costs by summing up transportation expenses such as flights and car rentals, accommodation costs including hotel stays, and daily allowances for meals and incidentals. 

3. How can I save travel costs?

You can save travel costs by booking in advance to secure lower rates and negotiating corporate discounts with preferred vendors. Encourage employees to use cost-effective alternatives like economy flights and budget accommodations. Additionally, implement strict travel policies, use technology to optimize expenses, and consider virtual meetings to reduce the frequency of travel.