Business travel is not cheap. A recent study released by Wisconsin-based management consulting firm, Runzheimer International, which specializes in transportation, travel, and living costs, reflects the trends in payment and reimbursement methods in United States companies. How do Rhode Island companies treat these matters?
The study shows that 48 percent of respondent organizations reimburse actual meal expenses with guidelines for acceptable levels. Sixty percent do the same for lodging expenses.
Seifert Systems Invests in Energy Efficiency to Strengthen Operations
For manufacturers, energy is more than just another operating expense. It plays a critical role…
Learn More
Terry Finn, managing partner at Providence law firm Edwards & Angell said employees in the firm travel quite frequently.
”Usually you use your own credit card and save your receipts,” said Finn of his company’s policy.
”Meals and reasonable travel and hotel expenses are covered,” he said. “The only thing is that we expect people to fly coach.”
Information within the study also said that 73 percent of respondents use per diems as a guideline for meal and lodging reimbursement. This doesn’t seem to be the case with many of the leading companies in Rhode Island, however.
Wes Cotter, director of communications for Gilbane Building, the largest private company in Rhode Island, said that Gilbane trusts the employees to spend modestly and per diems are not enforced.
”When it comes to the issue of travel and expenses,” said Cotter, “We’re definitely a no-frills company. We handle expenses like we would any other time. People spend what they need to spend.”
Cotter speculated that high technology companies may be handling things differently.
”I have a feeling that some of the newer companies might reimburse things that are considered unusual around here,” he said.
This doesn’t seem to be the case, however.
Terrance Daly, CEO and chairman of daly.commerce said his company simply covers the basics. Daly.commerce is a provider of distribution software for wholesale distributors.
”Our industry does very little social entertaining,” said Daly, “Almost all of our travel and entertaining budget is for travel.”
He said his employees use corporate credit cards, a practice that Runzheimer found in 76 percent of respondents.
Eric Holter, co-founder of Web-design company Newfangled Graphics said his company’s business expenses are most often handled by his clients.
”Anything like that is paid for by the client,” he said, “Most design companies with expenses related to the project would make copies of receipts and bill the clients.”
And what about the cost of business travel?
Travel management experts at Runzheimer predict business travel costs increase a record 7 percent during 2001.
Senior Travel Consultant Rolfe Shellenberger said this is the biggest increase his company has ever predicted.
”It reflects our conviction that inflation, high demand, and constrained inventories of seats, rooms, and cars will occur simultaneously in late 2000,” Shellenberger said.
Finn said that he and the people at Edwards & Angell have already felt the impact of the increase in travel prices.
”The biggest place where you see it is the shuttle flights between Boston or Providence and New York and D.C.,” he said.
Other important findings of the Runzheimer study:
Top sources for per diem guidelines are internal, historical cost data (32 percent), federal government reports (29 percent), and the Runzheimer Guide to Daily Travel Prices (23 percent)
Average per trip temporary advance is reported as $571, with a median of $400.
Average permanent ongoing advance is reported as $733, with a median of $500.
Issuing a separate check to employees remains the most popular form of travel and entertainment, offered by 73 percent of respondents, although electronic funds transfer is on the rise (25 percent).
The majority, 51 percent of respondents’ travelers submit expense reports within two weeks of receipt, and 51 percent of organizations issue reimbursements within one week.
