In part one of this three part series (UK Travel Management Study 2014) we look at the rising cost of travel and how that is impacting how travel managers are allocating their 2014 spend. Six key industry mega-trends are discussed relating to corporate social responsibility and technology.
LONDON – The 2014 International Travel Management Study of travel managers in 24 countries worldwide shows clear signs that British business is on the move again – literally. One-third (33 per cent) of UK travel managers expect business trip numbers to increase over the next 12 months, higher than the Western European average of 29 per cent and higher even than the global average of 31 per cent, which includes fast-developing economies such as Brazil, India and China.
The overall message that UK business travel is set to pick up, and at a faster rate than the rest of Western Europe, is consistent with recent economic data. According to the October 2013 edition of the International Monetary Fund’s World Economic Outlook, GDP in the UK grew an estimated 1.4 per cent in 2013, and is forecast to grow a further 1.9 per cent in 2014. Compare those figures with the average for the countries the IMF labels as “Advanced Europe”: GDP for them was static in 2013 and will grow 1.2 per cent in 2014.
Fears over costs intensify
Rising spend is a major concern for UK travel managers. No fewer than 54 per cent expect travel costs to increase over the next 12 months, a massive increase over 2013, when the figure was 38 per cent. The number who predict costs will fall has dropped from 15 per cent to 9 per cent.
The conclusion is that rising cost per trip is going to be a major factor in 2014 as well as a simple increase in trip numbers. Since demand is set to grow, but there has been little increase in supply of air seats or hotel rooms, that is not surprising. However, another subtle but important factor is changes in the destinations British business travellers are visiting. According to E&Y, exports to Italy and France will grow 3.8 and 4.2 per cent annually respectively to 2020. In contrast, exports will grow 6.4 per cent to the US, 6.9 per cent to China, 7.8 per cent to Brazil and 12.5 per cent to India.
Yael Klein, Managing Director of AirPlus in the UK says “The fact that UK travel managers are optimistic about the number of trips taken in the next 12 months is a good sign of UK’s economic recovery and can only be seen as a positive step for UK organisations. The fact that costs are expected to rise, is no surprise, but I urge corporations to continue to execute the controlled approaches to travel management they put in place over the last few years, as this will help to save costs across their businesses”.
Environmental awareness is top concern for UK travel managers
For the first time, participants in the International Travel Management Study were asked about the influence that six current mega-trends have on business travel. In the fields of corporate social responsibility and technology, travel managers in the UK give most weight to the aspect of “environmental awareness” (60 per cent), well ahead of any other country in Western Europe and North America.
The UK has long been regarded as a leader in green corporate practices, and new regulations in October 2013 strengthened already stringent environmental reporting requirements placed upon large businesses. UK companies and travel management organisations have also been pioneers in green travel management practices.
Klein goes on to say “I am pleased to see that UK businesses continue to be ahead of the game when it comes to best practice travel management. The UK has established itself as a trailblazer in forward thinking professional travel management and I have no doubt will continue to grow from strength to strength.”
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.
She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
