Center, a software company helping businesses gain visibility into and manage employee spending, released insights from its fourth annual Expense Management Trends survey, revealing that “despite an uncertain economic environment, over a third of respondents (36%) plan to spend more than $250k annually on travel, with 16% expected to spend over $500k.”
Other findings “include the need for updated expense management checks and balances, as businesses remain plagued by outdated processes that make cost control and budget compliance difficult in challenging economic times.”
A historically difficult cost to control, travel is “typically the second highest business expense for companies behind payroll.” Looking ahead, a 2022 poll from the Global Business Travel Association shows “a rebound in domestic business travel compared to pre-pandemic levels, estimating an almost full recovery (63%) compared to 2019.”
Data from Center’s research “validates the rise in travel spend based on the following:”
Half of survey respondents (50%) expect business travel “to increase in the next 1-3 years.”
Just over one third (36%) are “spending more than $250k per year on business travel
16% spend $500k or more per year on business travel”
Though business travel is on the rise, survey respondents believe “they do not have clearly defined T&E policies.”
The lack of policies “creates confusion about what counts as a business expense, what the spend guardrails are, and how to track expenses accurately.”
An increase in corporate travel and a precarious economic climate calls “for more dynamic planning and refined employee expense controls.” To effectively manage employee spend as the landscape for corporate travel continues to evolve, SMEs require “more comprehensive T&E guidelines and user-friendly tools.”
Over half (58%) of respondents “have either outdated T&E policies or no T&E policies at all.”
44% book travel “directly (outside of corporate booking tools).”
The #1 stated reason for “not booking through a corporate tool is lack of knowledge regarding corporate tools and processes or not knowing they exist.”egacy Systems
According to the new research, most respondents (more than 50%) now work in a fully remote or hybrid environment and “have issued more corporate cards over the last three years to accommodate the change.”
The shift to a more decentralized expense management process “has resulted in ill-equipped or rigid systems, lack of automation and real-time visibility, and additional challenges,” including:
- Inefficient management of expenses with roughly one-third (32%) relying on manual processes and manual reconciliation using spreadsheets and paper
- Dissatisfaction in current expense management tools (24%), with 37% describing the processes of reviewing and approving expenses as “complex”
- Time-intensive tasks, such as: employee time spent filling out expenses (40%), time spent creating/analyzing expense data and trends (31%), and credit card reconciliation (27%)
Naveen Singh, CEO of Center, said:
“After four consecutive years tracking the sentiment of SMEs related to expense management, it is notable to see renewed optimism in business travel as a top area of investment. As businesses rethink and refresh their backend operations to accommodate the changing workplace, finance teams are increasingly leaning on technology and automation to help them keep track of spend across distributed workforces. Center remains committed to helping them be as nimble as possible as the way we work continues to evolve.”
