Although many organizations have either reduced or eliminated their travel programs altogether, a recent study reveals that this may have a negative impact on their bottom lines.
According to research conducted by IHS Global Insight and presented at the National Business Travel Association Convention in San Diego, as organizations increase or decrease their travel spend by 1 percent, they either see a corresponding 1.7 percent increase or decrease in sales.
The information was collected from ten years of records covering 1998 to 2008 and spanning 9,500 companies from 10 industries.
Using the information from the study as a guide, the NBTA projects that travel’s impact on profits would be maximized if total travel spend was increased across the board by 5.3 percent, or $14 billion. Kenneth McGill, NBTA Research Consultant, says that the move would increase total industry sales by 3.7 percent, or $894 billion.
"Having the ability to demonstrate the return on travel investment has increasingly become a focus and a key deliverable of our members to their organizations,” says NBTA Chair and Past President, Kevin Maguire. “We thought it was important to invest in this ground-breaking research to get past the pro-business travel and anti-business travel rhetoric and test the correlation between business travel and sales and profits.”
