Many companies today cultivate preferred vendor relationships in hopes of securing better prices, customer service and spending visibility, according to an article in CFO Magazine. With business travel on the rise, organizations are wise to develop preferred suppliers for such items as airfare, hotel rooms and rental cars. However, getting the most out of these relationships requires a streamlined, strategic approach to travel expense management.
In a recent survey of 173 executives at midsize and large European and North American companies, 77 percent said their companies could reap significant financial rewards by making better use of preferred vendor opportunities, CFO Magazine reports. The main obstacles in leveraging vendor relationships are enforcing internal compliance and consolidating purchase volume, according to the survey by SAP and CFO Research.
To achieve significant travel savings (often exceeding 20 percent of total spending), it’s critical that companies know what volume they can commit to with a vendor. Uncovering this strategic information requires that organizations efficiently analyze total spending on certain types of expenses, like airfare, hotels and car rentals. However, the survey suggests that most companies are not in this position. For two-thirds of respondents, tracking business expenses means grappling with multiple data sources and formats.
As companies seek to consolidate volume and ensure that employees use preferred vendors, a streamlined system is the key. To get the most for your money, use a centralized travel expense management solution like Chrome River EXPENSE that can provide powerful analytics tools as well as automate expense reporting and compliance.
Companies spend thousands — and sometimes millions — of dollars on travel and entertainment expenses. Using automated travel expense management creates a highly visible environment, providing managers with opportunities for developing preferred vendor relationships and many other financial and operational improvements.
We want to hear your feedback and suggestions. What advice would you offer companies when it comes to negotiating preferred vendor relationships? Let us know by posting in the comments section!
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Wow! This Chrome River is great. Word has spread [in our firm] and people that were not invited to be in the pilot group rollout have asked to be included!