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When Delta canceled 5,000 flights in a single week in the summer of 2024, travel managers across the country were scrambling to rebook executives, reschedule meetings, and rearrange ground transportation. Companies with in-house travel teams watched helplessly as productivity plummeted, both for stranded travelers and for the staff working overtime. Suddenly, theoretical discussions about the value of business travel outsourcing became all too real.
In this article, we’ll look closer at outsourcing and answer the questions that are likely on your mind: what is travel business outsourcing, and does it make financial sense?
Travel outsourcing companies are external service providers that manage corporate travel needs, including flight bookings, hotel reservations, and rental car arrangements, as well as handling travel expenses and ensuring compliance with travel policies.
Instead of handling travel arrangements internally, companies that outsource travel business process management services rely on specialized travel management firms. These firms use more efficient booking tools, negotiate better rates, and provide support for business travelers while they’re on the road.
Business travel outsourcing generally saves time, improves policy compliance, streamlines travel processes, and reduces costs.
But does travel outsourcing really pay off financially? The numbers say yes. Companies investing in professional corporate travel management see returns ranging from 21% to over 80%, depending on the program.
Most companies grossly underestimate what they spend managing travel internally. The visible costs – booking fees and travel manager salaries – are just the tip of the iceberg.
American businesses will spend approximately $472 billion on business travel in 2024, or more than $1,000 per trip. But these direct costs don’t capture the true cost of travel management. When non-specialized employees handle travel tasks, inefficiencies multiply.
Executive assistants spend hours a week researching flight options and accommodations. Finance teams have to process expense reports for each batch of travelers. IT departments allocate resources to maintain booking tools and security protocols, while HR addresses travel policy questions and compliance issues. Even the travelers themselves waste hours navigating unfamiliar booking systems.
When these hidden costs are factored in, in-house travel management typically costs 15-30% more than what companies budget. One mid-sized tech company found their actual travel management costs were 42% higher than their estimate after accounting for all the fragmented time their employees spent on travel-related activities.
“We thought we were saving money handling travel ourselves,” says the CFO of a manufacturing company with 200 frequent travelers. “When we added up the hours across departments and calculated the opportunity cost, we realized our DIY approach was costing us nearly $400,000 a year in lost productivity.”
The financial case for business travel outsourcing becomes clear when you look at real-world results. A corporate travel program that invests $100,000 and generates $150,000 in new business and cost savings has a 50% ROI. Factor in productivity gains, and this return often goes up to 80% or more.
Compare that to broader outsourcing statistics: outsourcing operational functions delivers up to 231% ROI across industries, while handling the same functions internally yields around 60%. That gap is the efficiency that specialized providers bring to complex processes.
Look at a hypothetical manufacturing company with $3 million in annual travel spend. Now let’s say they spend $280,000 on in-house management. After switching to business travel management outsourcing with an 8% fee ($256,000), they realized $384,000 in direct savings stemming from negotiated rates, plus $165,000 in productivity gains from automated processes. Their net benefit was $293,000 — a 114% ROI. They also reduced booking time from 45 minutes to 12 minutes per trip, with policy compliance rising to 92%, and saved 1,840 hours annually.
These results are based on composites of our Enshored customers, but they show how travel business outsourcing delivers returns across multiple dimensions.
These benefits also compound as travel volume increases, with larger companies often seeing stronger returns thanks to economies of scale.
The ROI of business travel outsourcing compounds across multiple sources.
For starters, travel management companies use their collective buying power to get rates that individual companies can’t. As a result, companies can often save 10-15% on airfare and 15-20% on hotels through these negotiated programs. For a company spending $2 million on travel, that’s $300,000+ in direct cost savings.
But these negotiated rates are just one way that outsourcing travel management help companies see an ROI. When employees stop juggling travel logistics, they focus on revenue-generating activities. Sales teams report more customer facetime when they don’t have to worry about booking their own travel, and finance departments processing expense reports with outsourced systems typically save hours a week.
Risk management is another big benefit, though admittedly it’s harder to quantify. Here’s what can be said: companies with outsourced travel programs report fewer travel disruptions and faster resolution when problems do occur. That means fewer missed meetings, less stress for travelers, and better business outcomes. This is why most good travel programs include comprehensive risk management protocols.
What’s more, professional corporate travel management companies like Enshored use advanced analytics to continuously optimize travel spend. One of our customers found hundreds of thousands in potential savings by analyzing their travel data – savings they couldn’t see when they managed travel in-house.
As business needs change, outsourced programs scale seamlessly without the hiring and firing cycles internal teams face. An outsourcing company, after all, can expand or contract services based on current needs — something in-house departments struggle to do.
A clear, enforceable travel policy backstops any successful travel program, and companies that use outsourced expertise to develop policies see higher compliance rates and lower average trip costs than those with internally developed policies.
A good travel policy balances control with satisfaction for travelers, a feat that’s not always easy to achieve. Fortunately, after dozens of client implementations, a good travel management company can create clear guidelines for your business without creating frustration for your travelers.
“Our previous policy was ignored,” says one of our clients. “Our travel management partner showed us which aspects actually saved money and which just frustrated employees, which reduced employee complaints by a significant margin. More importantly, it improved compliance.”
Don’t forget — compliance savings add up over time. One Enshored customer found that each percentage point of policy compliance saved them more than $40,000 per year across their travel program.
Start by gathering data about your current travel program, collecting 12 months of travel spend by category to establish baselines. Document all resources involved in travel management: travel managers, administrative staff who book travel, and time spent by employees on travel administration across departments. Identify pain points in your process that create friction for travelers and administrators. Finally, compare your metrics to industry standards to understand your gaps.
Estimate the potential savings from outsourcing travel management. Calculate direct savings from negotiated rates, and productivity gains from reclaimed employee time. Don’t forget to quantify policy compliance improvements and the resulting cost savings, as well as risk reduction benefits specific to your travel patterns (especially for global companies).
When choosing a business travel outsourcing partner, evaluate your options based on experience with similar companies to yours. Assess technology platforms and integration with your systems. Compare pricing models and SLAs to see which meet your needs. Check references for implementation success and ongoing support, and consider the cultural fit with your company.
Create a realistic implementation schedule that accounts for your company’s change management capacity. Identify resource requirements from various departments, and then plan communication and change management activities to get employee buy-in. Establish a measurement and reporting cadence to track your progress, and remember to set review milestones so you can evaluate and adjust.
Following this kind of process, most companies can implement travel management outsourcing in 90 days, and see an ROI in 4-6 months.
ROI begins with implementation, but the devil is in the details. Companies that follow a structured approach see returns in 3-4 months; those with a haphazard approach 9+ months.
Successful implementation begins with discovery in weeks 1-4. During this phase companies document current processes and pains, establish baselines for future comparison, identify quick wins for immediate impact, and define their success criteria. This foundation work will ensure future improvements.
Weeks 5-8 are for design and planning, where companies work with their partner to develop optimized workflows, create communication and training materials, configure technology platforms and establish reporting frameworks.
Controlled implementation usually happens in weeks 9-12, with a pilot group of travelers. Companies collect feedback and refine their processes, analyze early results against their baselines, and adjust their approach based on initial data.
Finally, full deployment happens in weeks 13-16, rolling out to all travelers with comprehensive training programs. This is a good time to implement regular performance reviews and start optimization cycles that will continue throughout the program lifecycle.
This phased approach minimizes disruption and accelerates returns. One financial services company we worked with followed this approach and broke even on week 14, with positive ROI by month 4.
With 48% of travel buyers expecting more business trips in 2025 than in 2024, establishing measurement systems now positions companies to manage this growth. The most successful companies track financial metrics such as average cost per trip vs industry benchmarks, percentage of bookings at preferred rates, processing cost per expense report, and year-over-year savings on similar trips. These quantitative measures show the direct financial impact of your travel program.
Operational metrics are equally important, however. Look at policy compliance rates, advance booking percentages, online booking adoption, and first-call resolution rate for traveler issues.
Traveler experience metrics should track booking time, satisfaction scores, support response times, and the number of travel disruptions. Together, these metrics will provide a complete view of your program performance.
“We used to measure our travel program by cost only,” says the procurement director of one company. “Now we measure the entire experience. This total view revealed $230,000 in annual savings we never saw when we only looked at ticket prices.”
While the data clearly supports the case for business travel outsourcing for most companies, you should consider your specific situation before you decide.
Companies with an annual travel spend over $500,000 will see bigger returns from volume discounts, and those with 25+ employees who travel regularly will gain efficiencies from centralized management. Finally, companies with travel across multiple destinations will benefit from consistent service across locations.
If your current travel management lacks specialized expertise, your travel policies need to be strengthened or enforced, and your leadership views travel as a strategic function, not just an expense, you have a lot to gain. Conversely, if your business very simple, low-volume (or highly specialized) travel needs, you might need a different approach.
But with the travel BPO market growing rapidly, there’s a solution for every company in today’s business world.
“We were hesitant at first because our travel patterns seemed unique,” says the operations director of a specialized engineering firm. “What we found was that our ‘unique’ challenges were common in other industries. Our travel management partner had already solved these problems dozens of times.”
And if there’s a fit, we’d love to do the same for you. Contact Enshored to explore your travel business outsourcing options — and let’s get you moving more efficiently and cost-effectively.
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