Why travel expense policy is critical for businesses

Not having a travel policy seems great for travelers but it may lead to huge inefficiencies in travel spend, which undoubtedly would result in corporate crackdown. Having no policy means your employees have no benchmark against spending. They can choose whichever vendors they like, and thus you can’t funnel spend against vendors. This will not help you negotiate the best rates for travelers.

So, why don’t companies enforce travel policies? Some haven’t got around to writing a travel expense policy, while some may feel that enforcing a travel policy is difficult. This is especially true for firms that depend on manual process to approve expense reports. Rules will be built into the system so that users can’t submit expenses that are not within the policies. Working with an online booking tool would help in ensuring compliance as your employees get restricted to airlines, hotels, and car rentals.

However, none of the reasons should prevent an organization from having a travel policy. Travel policy avoids unnecessary expenses and drives discounts while negotiating with vendors. Here are a few key points to note about a T & E policy:

  • Apparently, 39% of travelers are not clear with the T & E policy

  • Employees should understand what is covered and what is not in the company’s T & E policy

  • Your policy should not be overly restrictive

  • Ensure you balance between cost vs. employee satisfaction

Expense report software can enforce the company’s policy effectively and help you track expenses accurately. This would automatically improve employee productivity and ensure greater transparency.

Hence, not having an expense policy could hurt you in the long run. Having a fair and workable expense policy could pay rich dividends for both employees and business.