Invisible spend refers to the travel expenditure that is done outside the channels that you have defined. Invisible spend should be minimized because it can have a huge impact on your travel program. The following are some of the adverse effects of invisible spend.

Encouraging Non-Compliance: When one employee makes a booking outside the approved channels, others will take note and a few more will venture outside as well. Before long, non-compliance with the company’s travel policy can become a major problem throughout the company. Other negative effects, such as your inability to ensure that employees are safe when they travel, crop up if invisible spend goes unchecked.

Negotiations Become Harder: It is harder for you to negotiate with vendors for preferential rates if your employees routinely use unapproved channels to make bookings. This is because you will not have actual travel data to put before the service providers during the negotiations. Consequently, you are likely to miss the discounts that come with dealing with a few service providers when employees travel.

Budgeting is Harder: The experts at CrewFacilities.com also point out that budgeting and making projections becomes a guessing game when invisible spend is significant in your company. This is because proper budgeting relies on past data to predict future spending trends. Invisible spend denies you the valuable data that you need in order to budget effectively, so your bottom line is likely to suffer year after year. Any reports you analyze will not reflect the full picture, and this will result in the wrong conclusions being made about your travel program.

The old adage that you cannot control what you don’t measure comes into play if you want to control invisible spend in your corporate travel program. A good place to start is to analyze the expense reports of your employees so that you can identify cases of invisible spend. You can then use your findings to draw an action plan to stamp out invisible spend from your company. This task may not be easy, and that is why you need the seasoned CrewFacilities.com professionals on your side during this process. We will help you to make your travel policy more relevant and we will also provide booking tools that can help to reduce cases of invisible spend.