In large organizations, Travel and Expense is one of the top three controllable operating expense categories. It is one of the few cost areas at this scale where Travel and Expense optimization can generate significant and measurable results.
Yet many finance leaders still underutilize the optimization potential of their T&E programs because they lack visibility into where to act first and how to prioritize their efforts.
So, within a Travel and Expense program, where do the real savings opportunities lie, and in what order should they be addressed?
Travel and Expense optimization: distinguishing quick wins from structural improvements
The first mistake organizations make when optimizing T&E is treating every lever as equal. Some initiatives generate savings within weeks. Others require six to eighteen months of transformation before delivering measurable results. Confusing the two often leads to unrealistic expectations, abandoned projects, and investments with no visible return.
Quick wins: fixing today’s leakage
Quick wins are typically found where spending escapes control without anyone realizing it.
Leakage is often the first area to assess. It represents Travel & Expense spend occurring outside approved booking channels, without visibility for Finance teams and outside the scope of the travel policy. Every percentage point of leakage recovered brings spend back into negotiated programs.
Advance purchase is another immediate opportunity. Market data consistently shows that airline tickets booked well in advance cost significantly less than last-minute bookings. Embedding advance purchase requirements into the travel policy and making them visible within the booking tool can generate substantial savings without any supplier renegotiation.
Virtual cards are the third immediate lever and remain underutilized in many large organizations. A virtual card generates a unique card number for each transaction, with predefined spending limits and categories. As a result, expenses are controlled before they occur, leakage is structurally reduced, and accounting reconciliation becomes largely automated. Several CAC 40 companies have reduced leakage rates by 8 to 12 percentage points on spot travel purchases through the deployment of virtual cards and lodge card programs.
TMC rationalization and the removal of unused services complete this first layer of optimization. Many organizations continue paying for features they do not use or service levels that exceed their actual needs.
Travel and Expense optimization: building long-term performance
Long-term Travel and Expense optimization rests on three pillars: supplier renegotiation, tool harmonization, and global travel policy alignment.
Structured airline and hotel negotiations only deliver their full value when supported by consolidated data and clearly documented travel volumes by route, category, and entity. Without that foundation, negotiating leverage remains limited. With it, savings typically range between 8% and 22%, depending on the maturity of the program.
Tool harmonization is often the most underestimated initiative. When a company operates multiple expense management platforms, several TMCs, and only partial ERP integrations, the cost of complexity itself becomes a significant optimization opportunity.
The most profitable negotiations in today’s T&E programs
Hotels: the most accessible opportunity
Hotel negotiations currently offer some of the best optimization conditions. Consolidating volume across a smaller number of preferred properties in key destinations enables organizations to secure preferred rates, reduce average room costs, and improve compliance. Predictive analytics tools can now identify rebooking opportunities in real time, generating up to 5% additional savings on average room rates, independent of supplier negotiations.
Air travel: ROI driven by volume
Airline renegotiation is more demanding. Return on investment depends directly on airline volume concentration and the ability to demonstrate market share alignment. For organizations that do not yet meet volume thresholds, consolidating booking channels should be the first priority before launching structured negotiations.
TMCs: significant savings often overlooked
Renegotiating a TMC contract remains one of the least-addressed optimization initiatives despite being one of the most profitable. Simplifying service scopes, automating low-value tasks, and revisiting pricing models can significantly reduce transaction costs while directly impacting the overall T&E budget.
The KPIs that drive real Travel and Expense optimization
Optimization without performance indicators lacks direction. The KPIs that matter in a T&E program are not activity metrics. They are performance metrics.
Travel policy compliance rate measures the percentage of bookings made through approved channels and within established policy limits. A compliance rate below 80% typically indicates that policies are not being consistently enforced, regardless of the technology in place.
Expense report cost per transaction measures the operational efficiency of the expense management process.
Carbon footprint per trip has also become a critical KPI. Since the implementation of Scope 3 reporting requirements under the CSRD framework, business travel expenses have become auditable by external auditors. Organizations that fail to integrate carbon tracking into their T&E programs face both compliance risks and potential inconsistencies between their ESG commitments and actual spending behavior. Next-generation T&E platforms now provide automated carbon calculations directly within booking workflows.
Additional essential KPIs include: leakage rate, average reimbursement cycle time and online booking tool (OBT) adoption rate. Together, these metrics form the minimum dashboard required for a data-driven T&E program.
Why Travel and Expense optimization requires expert support
Optimizing a Travel and Expense program simultaneously involves Finance, Procurement, IT, HR, and operational teams. Without coordination among stakeholders and a clearly prioritized roadmap, initiatives become fragmented and results fail to materialize.
At SD Global Consulting, we support T&E decision-makers throughout every stage of optimization: from initial assessment and KPI design to supplier negotiations and the deployment of T&E solutions tailored to your organization’s requirements.
Would you like to understand the true maturity of your T&E program and identify the optimization opportunities that will generate the greatest impact first? Don’t hesitate to reach out to our team of specialists. You can contact us directly via our website form.
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