Understanding and effectively managing employee spending is imperative for Australian organisations aiming for success, especially as business leaders navigate a dynamic landscape that demands flexibility.
The economic climate is changing rapidly, and companies require effective strategies to manage travel and expenses (T&E) without compromising on efficiency or employee satisfaction. SAP Concur has revealed the findings of its research into the changing spending habits of employees between 2019 and 2023, examining how Australian organisations are adapting to emerging challenges.
Jonathan Beeby, managing director, SAP Concur Australia and New Zealand, said, “Recent spending trends have highlighted a shift in behaviours and working conditions that reflect broader economic and social changes. The evolving nature of work has changed how and where employees are spending company money, forcing executive leaders to rethink how they approach T&E management and drive greater agility and adaptability in corporate policies.”
Key research findings include:
- the average expense cost increased by more than 20 per cent across air travel, car rental, entertainment, gas, office expenses, and parking, reflecting inflation and rising costs
- the average cost of train travel decreased by more than 30 per cent, making it a competitive, cost-effective business travel alternative
- air travel decreased across both total spend and volume of transactions, demonstrating a shift in business travel behaviours nationwide
- while total parking spend decreased by 18 per cent, total car rental spend increased by six per cent
- office spend increased by 50 per cent between 2019 and 2023, reflecting the change in working environments.
Fluctuating travel costs indicate a key behavioural shift both in Australia and globally, with SAP Concur’s data also revealing significant changes in the average cost per transaction across various expense categories from 2019 to 2023. In Australia, airfare expenses increased by 22.2 per cent, compared to 10 per cent globally. Car rental expenses also experienced a substantial hike, with costs rising by 26.2 per cent in Australia, in line with the global average of 28 per cent, indicating similar pressures worldwide. Comparative to sharp increases across other travel categories, Australia experienced a significant 32 per cent decrease in the average cost per transaction for train travel between 2019 and 2023 while all other regions experienced increases.
Jonathan Beeby said, “The diversification of expense categories, including increased spending in remote work setups and digital communication and collaboration tools, indicates a broader range of needs as employees adapt to new ways of working, shifting from traditional offices towards a more dispersed workforce. This reflects a deeper transformation within business landscape, where flexibility and digital readiness have become key drivers of competitiveness and employee satisfaction. And, just as typical work settings are no longer preferred for many organisations, traditional methods of T&E management are no longer sufficient to meet the demands of modern enterprises.
“Without access to T&E spending trends, companies are left in the dark, unable to optimise their processes to find cost-saving measures that benefit their people and the bottom line simultaneously. Comparatively, business leaders that can see where their people are spending and benchmark their costs against regional and global trends can rapidly adjust their spending behaviours to save on costs; that’s where smart T&E solutions come into play.”
SAP Concur’s research shows the value of having access to the latest spending trends, giving organisations an opportunity to benchmark their expenses against local and global shifts, and identify opportunities to optimise processes and save costs.
There are five ways sophisticated, artificial intelligence (AI)-enabled T&E management solutions can help companies better manage their expenses:
1. Automate and streamline expense reporting processes to reduce the time and effort required for manual entries and approvals.
2. Detect patterns and anomalies in spending, enhancing compliance and preventing fraud.
3. Empower businesses to keep pace with the dynamic nature of T&E management and adapt to new spending behaviours and regulatory requirements with greater agility.
4. Equip executive leaders with predictive analytics for insights into future spending trends for more informed decisions about T&E policies.
5. Simplify the reimbursement process to optimise spending, achieve cost savings, and enhance employee satisfaction.
Jonathan Beeby said, “Modern T&E management solutions integrate real-time data and predictive analytics to identify cost-saving opportunities and recommend the most economical and sustainable travel options available. Australian organisations must adopt solutions that offer greater flexibility and detail in tracking and analysing expenses to better understand regional and global spending trends and use this to their operational advantage. With the right tools and approaches, companies can achieve a balance between controlling costs and supporting their employees’ needs in an evolving market.”
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