A comprehensive study conducted by leading global research firm Oxford Economics establishes the first clear link between business travel and business growth. For every dollar invested in business travel, businesses experience an average $12.50 in increased revenue and $3.80 in new profits, according to the findings. It is the first time that the return on investment of business travel has been successfully measured.
“This study shows that not all spending cuts are smart cuts,” said Adam Sacks, managing director of Oxford Economics. “When companies reduce their travel budgets, there are negative consequences that we can now quantify, in terms of lost revenue and profit growth and in terms of giving competitors a distinct advantage.”
The study comes at an opportune time for American businesses that are planning their 2010 budgets and for federal policymakers looking to stimulate a struggling American economy. The study found that curbing business travel can have a strong negative impact on corporate profits. The average business in the United States would forfeit 17 percent of its profits in the first year of eliminating business travel, and it would take more than three years for profits to recover.
Business travel in the U.S. is responsible for $246 billion in spending and 2.3 million American jobs; $100 billion of this spending and nearly 1 million American jobs are linked directly to meetings and events, according to the U.S. Travel Association.
Source: U.S. Travel Association and Destination Marketing Association International