As businesses plan ahead for travel and entertainment (T&E) spending in 2013, making predictions is still foggy at best. The fiscal cliff episode has raised numerous questions about how tight budgets will be, which affects corporate plans around hiring, capital investment and of course corporate travel. Travel in particular is a high-cost area, which accounts for around 10 percent of a company's budget.
On balance, the past couple of years have witnessed a small rebound in corporate T&E spending to which airlines, hotels and other providers are responding by raising rates, making the picture not as rosy for executives wanting their employees to regain face time with customers that was lost in 2008 and 2009.
Despite obstacles around the globe, corporate travel volumes following the robust recovery of 2010 generally have held or grown further," reports Business Travel News. "Airlines and hotels in particular have leaned on that sustained activity to raise prices and generate more revenue."
Given the uncertainty, and the fact that many companies are still operating conservatively, T&E spending will at best stay steady this year, with decent chances for a decline. Regardless, many companies will aggressively look at cost-cutting tactics. Here are predictions on how companies will keep those costs in line:
LESS TRAVEL, MORE ONLINE MEETINGS. Companies may look to cut travel budgets significantly, even by 50 percent, through taking advantage of Web conferencing technologies.
PERKS WILL TAKE A RACKSEAT. As the recession created the need for employees to work longer hours and take on more responsibilities to make up for smaller staffs, employers did what they could to ease that...