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Grounded by the high costs

Shyam Ranganathan

Companies are looking at alternatives to reduce travel expenses

From business executives forced to meet their Chinese clients in Singapore to small-scale entrepreneurs in the suburbs cutting down on call-taxi expenses for visits to the city, businesspeople are tightening their seat-belts.

Rising fuel costs are reflected in fares, and companies with significant travel expenditure are trying to economise on trips. M. Rafeeque Ahmed, chairman, Farida Group, says that he now takes the flight only for indispensable trade fairs and very important meetings. Others are handled through video-conferencing and other means.

“Although the technology is not perfect, we are trying to bring down our travel expenses (nearly Rs. 3.5 crore out of a turnover of Rs. 400 crore). Apart from travel itself, there are the rising costs of hotel accommodation etc. and we are looking at reducing our costs,” he says.

R. Swaminathan, a Human Resources manager, is trying to cut down on his work-related travel.

“I try and do my business meetings through video-conferences or over the phone,” he says, pointing out that the cost of air travel has gone up significantly in the past six months. K. Venkataraman, director, Diana World Travels, says this trend is being seen in most big companies. “Airlines hit by fuel costs are hiking their rates. For instance, businesses are trying to cut down costs by allowing business-class travel only for flights six hours and longer,” he says.

A senior manager in an international airline says that corporate travellers are moving from business-class to economy. Those who flew economy before are switching to trains, he says.

But trains and buses being used by a large category of business-travellers within India are not without their share of pain. Costs have increased across the board, and where fares have been left untouched, other components such as food, hotel stay and other expenditure bear the brunt.

“Private buses have been increasing fares and we are now forced to cut down on our travel. Other costs are also forcing many medium-scale businesses to cut down on business travel and look at other means of concluding their deals,” says R. Sridhar, who has been touring the country for his jewellery-box business.

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