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Business travel in Australia is the world’s most expensive

July 23, 2013 Corporate No Comments Email Email

Australian cities are among the most expensive for business travel according to a report released today by Concur, a leading provider of integrated travel and expense management services.

Concur’s third global report on corporate travel and entertainment (T&E) spend ranks three Australian cities in the top five with Brisbane coming out on top.

Four Australian cities made the top 10 most expensive cities for business travel including; Brisbane (1st), Sydney (3rd), Perth (4th) and Melbourne (7th). Last year, Brisbane ranked 7th, making this a big jump for the city with ties to the mining investment boom. Similarly to the report last year, however, Sydney was the only city to feature in the list for the top 25 most visited international cities for business travel, coming in at 17th place.

With access to spending insights, negotiating power and mobile tools key to managing expenses for businesses of all sizes, the Concur Expense IQ report uncovered that Brisbane hotels cost Sidebar-Article-Banner-250US$305.05/night on average, in comparison with New York where a hotel room costs and average of US$194.62/night.

With the Australian dollar continuing to suffer, corporate travellers are having to not only contend with poor exchange rates, but also significantly higher dining and entertainment costs. With Sydney taking pole-position globally as the most costly place to eat: a meal averages US$70/person, in comparison to notoriously expensive culinary cities, such as Paris, where a meal is US$49/person.

Comparatively, companies visiting Australia are spending less on dining and entertainment than they were in 2011, with dining expenditure decreasing by 4.47 percent, and entertainment by 14.77 percent. In addition, logistical expenditure by business travellers visiting Australia has increased, with spending on items such as lodging rising 3.37 percent and ground transportation by 7.07 percent. 

The Concur Expense IQ Report also uncovers differences between SMBs and large companies, including the fact that SMB travellers spent more on average per quarter in 2012 for T&E expenses in every major category, including:

·         Airfare (14 percent)

·         Dining (18 percent)

·         Lodging (21 percent)

·         Car Rental (57 percent)

“The second-largest controllable spend for most companies is T&E – making visibility into this area mission critical. The Concur Expense IQ Report is designed to do just that,” said Michael Eberhard, Concur executive vice president and general manager, APAC.

“Companies are able to use the report to justify spend and make considered choices with regards to business travel,” continued Eberhard. “Using Brisbane as an example- with the city still in the midst of the mining-related construction boom, accommodation costs have contributed significantly to its position at the top of the list. These increases are influenced by the influx of FIFO (Fly In, Fly Out) workers to the city, and the growing importance of corporate hospitality to the Queensland economy.”

With regards to SMBs, the data shows that they are more active on average than large market companies due to the fact they file expense transactions nearly 17 percent more frequently and spend almost 25 percent more on the road. This underscores the importance of deeper insight and analysis into T&E spend to negotiate better prices, manage expense policies and improve efficiencies.

Concur found that despite paying more for airline-related products and services, companies still spent 4.5 percent less overall, per traveller, per quarter, in 2012 than they did in 2011. A key reason for this was a significant drop in fourth-quarter spending.

T&E is typically one of the most poorly managed spend categories. The Expense IQ report will enable companies to better measure and benchmark spend patterns against peers, negotiate prices and evaluate providers.

Desire for Mobile Expense Reports Growing

Mobile devices were also found to be a growing aspect of companies’ expense management processes as logins to the Concur mobile expense app more than tripled from 2011 to 2012. The study found nearly 73 percent of these logins were via Apple iOS, while Android (14.6 percent) and Blackberry (12.7 percent) were also popular.

“We’ve seen great momentum around Concur’s mobile application this past year among businesses of all sizes,” Eberhard said. “Understanding that travel is inherently mobile, it’s easy to see how using a tool that moves with business travellers wherever they go increases productivity – whether it’s billable work or something more administrative like managing expenses.”

Methodology

To produce average spending data, Concur looked at aggregated expense report data for calendar year 2012. For year-over-year data, Concur compared 2012 spend data to comparable data from 2011. All data used to compile this report is anonymous and aggregated, so that no specific company or personal identifiable information is ever used or analysed.

The most expensive cities were determined and ranked by the average spend in each of the major expense categories.

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