Meals and hotel stays are becoming a bigger cost for business travelers. Airfares have dropped, although this doesn't help companies that dispatch their workers in cars for meetings in nearby cities.
The past five years have seen ride hailing apps completely disrupt traditional taxis and car services for business travelers. Dining, however, is not only the most common expense for travelers but one that is eating into a larger chunk of corporate budgets.
Expense technology provider Certify examined more than 50 million expenses on its platform and $3.3 billion in spend for a look at how business travelers spent money in 2018.
What they found is an uptick in spending on dining, along with Uber’s continued growth across the world. The average meal expense is now $5 more than it was in 2016, while airfares have declined by about $40. Hotel stays have become $50 more expensive on average, likely the result of high occupancy in major business travel destinations.
“Enterprise-wide adoption of sharing economy services—due to convenience, efficiency, and price—are key drivers for this shift,” said Robert Neveu, CEO of Certify. “The sharing economy vendors have rapidly adopted offerings to target the business traveler and have made it even easier to consume their services across large and enterprise organizations.”
Breaking down the most common expense categories, meals are becoming more expensive along with hotel stays and fuel. Ride hailing services and airfare, though, have declined in average cost.
|Average Transaction Cost by Category|
|2018 Avg Expense Cost||Change from 2017|
Uber was the most expensed company for the third year running, growing from 6.3 percent in 2016 to 11 percent of all expenses on Certify’s platform in 2018. For what it’s worth, Certify doesn’t break out car services in its ground transportation analysis due to the difficulty of parsing all of the various company names.
Uber rides were slightly more expensive than Lyft rides, but still much cheaper than the average taxi expense.
|Most Expensed Vendors in 2018|
On the dining side, Starbucks remained the most popular vendor in 2018, representing 23.4 percent of all dining expenses. It’s been relatively flat since 2016, though. Grubhub was the most expensed food delivery service, with more than a third of delivery expenses, although Doordash and Seamless exceeded Grubhub in spending per transaction.
Last year we remarked upon Amazon’s growth, displacing airlines as an expense for companies. This growth continued, with Amazon overtaking Delta to become the third most expensed company on the platform.
Read the full report below.
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Photo credit: Diners in a San Francisco restaurant. Steve McClanahan / Flickr