US companies could generate $2.4trn in additional revenue by increasing business travel spending by just 8.3%, according to new research from the Global Business Travel Association (GBTA) and American Society of Travel Advisors (ASTA). The study analysed 24 years of industry data across 14 major US sectors.
It found that current travel and entertainment spending sits $24bn below the profit-maximising level of $319bn, leaving companies with a potential 14.6x return on investment. Despite business travel’s rebound since the pandemic, inflation-adjusted investment remains $66bn below pre-2020 levels.
Companies need to spend just $184 more per employee on average to reach optimal investment levels, reportedly. Retail, wholesale and banking sectors show the largest gaps between current and optimal spending. This indicates that those sectors could have the greatest potential for high-impact growth.
The research reveals that a modest increase in corporate travel budgets could drive a 6% jump in sales across participating companies.
“The research released by GBTA this week tells a powerful story regarding the value of corporate travel. This initial study confirms what our corporate agency members have long known – business travel is … an engine for growth,” said Mark Meader, executive vice-president at ASTA Corporate.
ASTA and GBTA plan to release follow-up research this autumn about how travel management companies affect corporate financial performance. The timing comes as corporate travel managers worldwide assess post-pandemic travel policies.
Many companies implemented permanent travel reductions during 2020-2022 – but the new data suggests these cuts could be limiting growth potential. The study’s methodology examined the relationship between travel spending and key financial metrics including net operating margins and revenue growth across industries from technology to manufacturing.
The full study is available here
