SOUTH African business travellers – in line with global trends – are “hitting the road” less often but spending more. The country’s corporate travel scene has changed due to a combination of post-pandemic challenges, load shedding and rising inflation, according to travel data from travel group Corporate Travel
According to Bonnie Smith, GM of Corporate Traveller (a division of the Flight Centre Travel Group), their data shows that the number of travel bookings is down slightly in the first six months of 2023 when compared to the same period in 2019. However, the number of room nights is significantly up and has increased by 88%. “This trend indicates that business travellers are opting to stay longer at their destinations and planning more meetings during their trips,” Smith said in. “We’re seeing business travellers clustering meetings to achieve more on each trip.”
Despite the decrease in bookings, the Corporate Traveller research shows a significant increase in spending in the first six months of 2023 compared to the same period in 2019. “These increases have been observed both in international and domestic accommodation. Other travel components have also seen A substantial rise in spend: the transactional value for domestic flights has increased by 151%, international flights by 112%, domestic car rentals by 62%, and international car rentals by 224%.”
Smith said the reasons for these increases in spend while bookings remain constrained are varied. “It seems business travellers are leaning towards more premium services. Instead of booking economy flights or standard hotel rooms, they may be choosing business class flights or luxury accommodations.
“Of course, increased prices also play a significant role in the surge in travel spend. Prices for accommodation, flights and car rental are up across the line after the pandemic.”
Smith said the increase in travel spend comes at a time when companies in South Africa are feeling the pressure of load shedding and inflation. The changing travel landscape inspired Corporate Traveller to examine the complexities of business travel spending trends in South Africa and globally in a new white paper, “Economic Jet Lag: Understanding the Impact of SA’s Economy on Business Travel”. The report reveals how economic shifts have influenced business travel.
“The report reveals that power outages in South Africa aren’t just leaving people in the dark; they’re reshaping the future of work and business travel. Persistent load shedding is putting the brakes on the hybrid workplace trend, disrupting virtual connectivity, and shaking the foundation of online business events.
“South Africa is pivoting from the global trend, trading in digital workspaces for good old-fashioned offices, thanks to Eskom’s power failures,” Smith said, adding that face-to-face meetings are poised for a resurgence.
“Power solutions are a financial black hole, forcing companies to opt for the certainty of in-person dealings. Load shedding, ironically, is giving business travel an unexpected boost, making each trip a strategic play for maximum ROI.”
Smith said she sees a potential resurgence in 2024 as the economy improves and businesses regain confidence. “However, this doesn’t mean it’s ‘business travel as usual.’ The travel spend trends we see emerging will keep both business travellers and travel managers on their feet.”
