Speaker 1 (00:08.962)
Good morning and welcome to Management Under Construction. I'm Dee Davis.
And I'm Brad Wyatt and today that we are going to talk about business travel. What it means to be somebody who travels for business, how that impacts your work, how the business travel experience has changed post COVID and what the economics of business travel has been over the last couple of years and where they're shaping up. I just got done with a little bit of a trip that had nothing to do with business, although it was a business school trip.
Some listeners of the podcast will remember that I talked about being on the rugby team here at Michigan Ross. And we had our trip from here in Ann Arbor to downtown New York to compete in the annual NBA program rugby tournament. We competed against London Business School who flew in from England, Columbia, who's in New York, Chicago, Booth, a bunch of other schools. And I blew out my shoulder because I got tackled by two guys who were twice my size.
So I'm in a little bit of pain. It a little bit of a rough weekend. It was 35 degrees and raining the whole time when we were outside. So I certainly have that coloring my opinion of business travel at the moment. But I'll let Dee take it over. She's had a lot more experience traveling for the sake of business and she can kind of introduce her experiences with business travel.
Well, I've certainly had some interesting business trips, but none of them resulted in a blown out shoulder or being tackled by people twice my size, thankfully. COVID sure has changed the face of business travel and of the hospitality travel and dining industries in total in ways that I don't think any of us pre-COVID would have ever imagined. It's also
Speaker 1 (01:56.172)
sadly changed the sustainable business practices of a lot of those industries. I was proudly able to say that I chose where I dined very often when I was on business travel based on the sustainability practices of some of those businesses. And I'm no longer able to say that or necessarily do that. Every single place you go seems to be doing something different with disposable flatware and prepackaged and even in plastic still in some places. And that's a whole other topic.
Some people love business travel and some people hate it. And some people kind of fall somewhere in between. I have friends that avoid it at all costs. I'm one of those people that really enjoys business travel to a point. And I have people in my life that they live on the road 24 seven. I don't even know how they know where home is anymore. They're gone so much. So pre and post COVID experiences for me, I think
Pre-COVID business travel was a delight. I loved it. I had my favorite types of hotels and restaurants and bars and places that I would go. My absolute favorite hotels are mid-sized hotels. Not the really, really big ones where you're completely anonymous and not the really, really small ones that just don't have all the amenities and the services, but the mid-sized ones.
the ones that are just big enough to have a decent bar and a restaurant in there. So you don't have to go anywhere if you don't want to. And where the staff is small enough that they remember you when you come back. It's actually a pretty awesome experience to be greeted by name when you walk in the door and they, we got your favorite room for you. It's a pretty awesome experience. So that was happening to me a lot of pre-COVID, post-COVID, not as much, but still in some places.
during COVID and shortly after, was nothing short of an inconvenient nightmare to be on business travel. Hotels, bars, and restaurants were closed along with anything in the area. I started using Uber Eats in a way that I never did before because it was the only option that I had. I'm sure those industries, dining, mobile dining like that, you know, they bring it to you, Uber Eats and all those other services like that had a complete windfall during those times.
Speaker 1 (04:15.042)
And it changed everything because I think those people have continued to use those services far more than they did before. I remember this hotel that I was staying in, in LA. I was working in LA during COVID and even with a hotel key, you couldn't open the front door. You had to buzz and they would ask you your name and your room number. And then once they confirmed your name and your room number, then they'd let you in the front door.
It was that bad. It was not a good feeling at all. Nobody but a registered guest could come inside. I did a lot of car traveling during COVID because there were lots of rules in place. Some of my clients had these rules in place. If you fly, you have to isolate for 10 days before you can come to site. So I was driving back and forth across the country in a car so that I would not have to do that. Good luck finding a public restroom during that time. It was crazy.
So, you know, it definitely got super weird for a long time and it's much better now. One sustainability positive during COVID that changed, and I have seen it kind of stay that way, is housekeeping is by request only. And that's something that I've always done anyway, as I hang the do not disturb on the door when I get to a hotel so that they're not constantly coming in there and changing everything out when it doesn't need to be changed.
and you can check out all my sustainable travel tips on the yspe.co YouTube video. There's a series of videos dedicated to that if you're interested. Brad, what other kinds of business travel experiences have you had?
You I've really not traveled that much for business. I've always been on the job site I was on and. I guess when I was living in Los Angeles, I had the unique privilege of being able to commute between job sites that I was managing by taking the subway, which was such a great way to be able to go in downtown LA. Not a lot of people know that there's a great subway system there to be had, but that was so efficient. It was much better than trying to drive downtown fine parking there. I could just.
Speaker 2 (06:29.87)
get up from my desk and be at the other job site in 20 minutes, which was a very cool thing to be able to do.
The few times I've traveled for business, it's really had to do with interviews. And when you're interviewing and you're traveling to interview, there's another side of stress with that where you've got your clothes that you're trying to look professional in, but you pack them in a suitcase, so they're wrinkled. for me, traveling for business just makes me anxious in a way that traveling for pleasure doesn't. You have to not only manage the traveling to New City, you've never been to...
and making sure you're taking the right metro rail and getting on the right side of the platform and getting to the place on time to be able to shower and shave and get all the things done you need to get done. I end up falling into these basic, very conservative habits of like, I know there are nice restaurants in this town. I'm sure that if I went out and found a better place to eat, I could have a better experience, but I just need to be conservative and get into bed early so I can get up early next morning, so I'm gonna get Chipotle. So it was healthy, it's pretty cheap.
They usually have everything I want, although I end up traveling for business in a very controlled, regimented, not very adventurous way, which makes it feel.
Like a penalty almost that I don't want to have to experience that. That's been my understanding of the business travel world. Although my mom talks about when she used to be able to travel for business before 9 11 and just walking onto planes and everything being a lot more streamlined with that experience, be able to see clients and face a time with them in person meant a lot to her business. So I get why it's necessary for a lot of work and I think it's great to be able to do that. Teams is convenient, but.
Speaker 2 (08:13.496)
There's no replacement for that face-to-face experience with somebody that real time, seeing their face move in time as they react to the things you say and being able to emote to them. I get why it matters, but boy, does it drive me nuts when I have to do it.
Well, you're not alone. There's an awful lot of people who have a lot of anxiety about business travel. And I think when you maybe don't do it as much, it's, it's creates more anxiety. And when you're going to a new place, that's definitely something that creates anxiety because you're not familiar with the airport. You're not familiar with the area. You know, you have to run a car and drive on roads that you're not familiar with and how long is it going to take and what is traffic like all those kinds of things. It gets better.
When you do it more frequently and when you get to go back to the same places over and over, that's when you get to venture a little bit more. When I was staying in that hotel in LA, I was riding by train to LA every week and I'd stay there during the week and then I come home on the weekends. And it was great because I was always going to the same areas and I would stay at one of two or three different hotels in the area. I tried different ones and I figured out, know, I really liked this hotel. I really liked this area.
I can get up early in the morning and I can go for a really nice walk before I go to work or there's some really nice dining over here. And you can get to experience the area a little bit better that way when you're going to the same place frequently. I spent the last several years traveling to a project in Delaware and I'd never spent any time there before. I would fly into the Philly airport, rent a car and drive 30 minutes to Delaware. And I found this
Excellent hotel, perfect little midsize hotel. It was great. There was several restaurants within walking distance and it was just it was a great experience. I actually really enjoy staying there and I have a follow up project this year there so I get to go visit some more. And so it's it's fun when you find a place that you like and you find an area that you like. You kind of get to.
Speaker 1 (10:20.876)
know people up in Orange County for a while when I was working at a company. I would stay at this double tree in Orange County. That was great. And it got to the point where I got to know the patrons, the people that lived in the area that would come and eat and drink there, you know, the bartenders and that's the part that can be really fun. I've met a lot of really interesting people.
in my travels. So are you the kind of person that gets to the plane an hour early or the kind of person that shows up at the airport and just walks on the plane? What, kind of person are you?
Oh my gosh, this is the kind of thing that people should put on dating profiles. This is a deep, deep into the depths of your soul question. I didn't realize I was going to have to bear my soul like this today. My family grew up as they were arriving at the airport so that we're two hours early in the waiting area. And I got to the point where I was taking the trips on my own for weddings and things. was like, I don't think I need to be there that early. I think I can.
start to tighten it up and over the years I have become the kind of person who walks onto the plane just as they say.
I would have guessed the other way. So that's impressive. I'm always impressed by people that can do that.
Speaker 2 (11:38.03)
Well, especially with public transportation where you're not worried about traffic. I feel more comfortable doing that. If there's traffic involved and that's going to be a factor, then I'm there very early. But if I know the train is going to be on time or the train will be stopped and it's like, well, this is a whole nother problem then, then I can time it to have about a half hour to fill my water bottle and get a snack and then get on.
See, as much as I travel by plane, train and automobile, I'm still the kind of person that shows up way early. I would rather be there early. You know, if I'm at the airport, you'll find me in the United lounge working away, doing something, waiting. And then from there, from the United lounge, I will wait until five minutes before boarding to go to my gate.
Those lounges are a really fascinating thing. Is that your lounge suite, United is your thing?
It is United is my airline of choice and no one's paying me to say that they tend to go everywhere I want to go. I used to fly Southwest for many years, but they have so few international destinations that in the long run, it wasn't a great investment for me. And I have so many perks with United at this point that it pays for itself over and over again, as much as I travel.
And that's just it. But airline companies seeking your patronage for their upper tier members, they're trying to capture more value by having you get the premium credit card with them or by having you get to a certain status with them to spend that much more money to travel that many more flights with them. But they're paying it off to you too. In the old days, miles just counted for a lot more. You could spend them on more flights. You could use them more easily.
Speaker 2 (13:21.238)
Now they're not so much about giving out the miles. There are lot of blackout dates. The miles aren't worth as much when you convert, but the lounges for the very, very uppermost travelers within any airlines sphere or the American Express lounge for the people that have that credit card. Those are some very nice places to be. They definitely know where their bread is buttered with those folks.
Yeah, Sapphire lounges have become a lot more prominent in major airports these days. I guess I have a choice. have Sapphire, I have Amex, I have United, but I usually go to the United lounge. Free food and drink. That saves me a ton of money. Just not having to grab a snack in the airport because airport prices, they're their own universe. We all know that. Literally a hamburger could cost you $20 in an airport. They have good wifi. They have
little buffet that you can eat at. You can get an alcoholic drink if that's your jam and the right time of day for you to do that. They can get a little overcrowded. That's, guess, if I had one thing to say, they can. The one in Denver is can be really crowded, but they're building more all the time so that you have choices. So if that's an option for you, for any of you doing business travel, pick an airline or two.
get their credit card, get into those lounges, get into that really clean and less used bathrooms. Like that's a nice perk in those lounges. Some of those lounges are very nice and some of the older airports, need some work. Okay, so what is business travel really in economic sense? It's responsible for one third of all tourism in the United States. I found that interesting. I would not have guessed that.
Still today, this is true. Slightly increased dollar values from pre-pandemic numbers, making up $2 trillion of our GDP in the United States. Trillion with a T. Cost of business travel, of course, is up post-pandemic. That's not surprising to anyone. With inflation and reduced overall business travel, people are traveling less because of things like
Speaker 1 (15:34.862)
Zoom and Teams and all these other virtual meeting platforms, the value is still up there even though the number of trips is down because the costs have gone up so much. Currently the most expensive US destination is, drum roll please, New York City. Probably not that surprising with an average daily expense of $661, most of that being for the hotel.
Somebody who just got back from New York. I can see how that would happen. We were able to get a single King Hotel for two nights for 580 and I split that with a buddy since we're all students, but. We were trying to eat a lot of food to stay ready for the games and. We found a lot of expensive places to eat and then we finally found a cheap place to eat. They had a buffet and we got two pounds of food for $30 a person, which is a deal considering it was in Manhattan, but.
I was just like, how can you possibly charge this much for this? This is crazy. A Shake Shack burger for $20? That's like you said earlier, that's airport prices for a burger. What planet are we on? It's its own planet. That's what Manhattan is. But to be fair, the public transportation, so cheap, $2.90 to go anywhere in the city. $2.90. That's pretty impressive in my opinion.
Yeah, I refrained from the subway when I was there. I've been on subways. I just refrained from New York subway. I walked everywhere I went in New York or took a bus. That was the two ways that I traveled when I was in New York. We did take an Uber from the airport to our hotel. And I can tell you that we, the hotel, I think it cost us about $600 a night just for the hotel that we stayed in. And I mean,
It wasn't like a Ritz Carlton or anything. wasn't a bad hotel, but it wasn't a super high end hotel either. And the food was very, very expensive. If you consider just the food expenses alone as the most expensive food destination, Honolulu, Hawaii is the most at $117 a day, just for food.
Speaker 1 (18:01.41)
And the hotels there are also quite expensive. I go to Hawaii periodically. Sometimes it's for business, sometimes it's for pleasure. And this last time I went last year was for a conference. And yeah, that hotel was 350 bucks a night pretty easily. And again, nothing spectacular. It's just a room. Hawaii is very expensive destination. The business travel industry contribute
contributed to over 6 million jobs in 2022 and over half of them are direct business travel related.
direct the what is so direct meaning this
Direct means I work in the travel industry, business travel directly connected. So indirect might be like restaurants and things like that. So they're not business travel specific. So six million jobs in 2022, pre-pandemic, seven and a half million. Wow. So the numbers are definitely down. And we've seen this everywhere in the US and probably internationally as well.
Having a real hard time getting people to work in these industries. When I go into hotels, there are less employees. When I go into restaurants, there are less employees. When I go rent a car, man, there are less employees. There's one person at the desk and you just have to wait. It's very noticeable as somebody who travels quite a bit.
Speaker 1 (19:34.594)
The forced adoption of remote meeting platforms and inflation are the chief reasons that these industries haven't bounced back. In 2024, global business travel has increased 11%, which I found interesting. So people are more likely to travel internationally than locally. And it's expected to continue to rise in the next several years. So it is important.
remember that spending could be up while trips themselves remain flat or perhaps even decrease. Internationally, Tokyo is the most expensive international destination. 652 American dollars per day right up there with New York. They're just a few dollars apart. And the most expensive international hotel is in Tel Aviv.
I thought that was quite interesting when I was looking up the.
Yeah, you would have thought someplace like Paris or London or maybe even Tokyo would be the most expensive, but for Tel Aviv to take that long. I was supposed to go to Tel Aviv in May, but unfortunately that trip got canceled and I still want to go there someday. I've heard it's an amazing city, tons and tons of history, but that shocks me that they have that level of a hotel that would be that expensive.
Yeah, I was surprised too, because like you, I would have thought Paris or London or somewhere like that would have that, but surprising. So what's happening now? More and more companies are starting to favor in-person events and meetings while there's still a large number of companies limiting business travel as a way to save money. So I have clients that whenever things start getting a little bit tight, the first thing they do is lock down business travel for all their employees.
Speaker 1 (21:26.646)
Nobody, you you have to get any travel approved by your direct supervisor or, you know, some kind of a higher level manager. So business travel being really expensive and costing more per trip is definitely impacting businesses. The increased costs associated with business travel are tamping some of the trips. And I think that's going to continue to happen for some time.
It's going to be interesting to see how some of the recent tariffs and things like that are affecting international travel, positively or negatively. Because of financial impacts of tariffs, are we going to see more restrictions on international travel? That could be happening. The cost of eating out alone? Boy, so this was super interesting because we all know that the cost of eating out has
skyrocketed. Anybody who's eaten out in the last couple of years is like, wow, what is happening? Like you're saying, $20 for a burger and that's it. That it didn't, that used to be airport prices. It's now becoming normal. When I did some research on some studies that they've done on the cost of eating out and how that has changed since 2020. So this is super interesting buckle up for this. It is increased an average of 42%.
for major chain and fast slash casual dining. So we're not talking high-end dining here. We're talking about fast food, large chain, casual sit down type restaurants. Since 2020, it's gone up an average of 42%. Okay, I'm just gonna tell you prepare for your mind to be blown.
I can't help but laugh when I, this is the last place I would have expected to be at the top of the list. Waffle house.
Speaker 1 (23:20.374)
Waffle house has had a 96 % increase in cost. I gotta tell you, I've never eaten at a waffle house in my life.
That's an experience that's that's a that's an American that's that's Americana. That is a deeply American thing.
I pass a Waffle House all the time in Colorado. I drive right by it. There's this cheap gas station where I go to get gas. It's like the best price in the whole front range for gas. And I go there and get gas. And I drive down Ken Pratt, which is highway 119 and there's a Waffle House like two doors down from this gas station. I drive by it all the time. All I can think of is the comedian, Jim Gaffigan.
does a bit about the Waffle House. And he says, go in there in the middle of the night and the signs, the lights on the sign aren't even quite working. And it says awful house. And, you know, he just goes on this whole bit. And so every time I, we drive by, I go, there's the awful house. I've never eaten there. can't say anything about their food. have no idea. 96 % increase the Waffle House has had. It kind of makes you wonder how they were making money before.
if they had to increase prices that much. They have a single menu item, I believe it's a chicken sandwich, that has increased 150 % on their menu.
Speaker 1 (24:51.022)
IHOP, 82 % increase. Have to admit, it's been a long time since I've eaten that IHOP. Texas Roadhouse, I just ate at one of those last week. 46 % increase since 2020. Cracker Barrel, 35%, Olive Garden, 30%, Outback Steakhouse, 29, and the list goes on. And most of them are between 20 and 30 % increase.
So it's not your imagination that prices have gone sky high for dining out. On top of that, we're starting to see crazy things like fees automatically being added to checks. And some of this stuff is still ongoing. Places auto-tipping themselves like 30%. Have you had any of this kind of thing happen to you, Brad?
never seen it be added unless it's a big party, which I think has been a thing for a long time. It's like, yeah, that minimum of six people or something, then you get automatic opportunity. So I can't say I have.
I have seen it happen to me a few times where there's an automatic tip and you got to be real careful. It's stopped getting so prevalent. It was happening a lot more during COVID. You had to be real careful because we're used to adding the tip on. We see the total, we put the tip on, and then we sign the thing, the credit card slip, and we give it back. What happened a few times is there were places that were putting the tip on there. They were putting an automatic 20 or
25 or 30 % tip on and you wouldn't notice until you tip again. Recently, there have been people that have shown copies of what's going on to them and they're showing that they're auto tipping themselves quite a bit. Now, what I can say has happened to me a lot since COVID started is what I'm gonna call the tipping culture being out of control. Everywhere you go, people wanna be tipped.
Speaker 1 (26:47.822)
and you have to actively not tip when you're paying by credit card. They turn the screen around to you and it's already preselected a 20 or 30 % tip and you have to hit the more button and then say no tip. That happened to me yesterday. It happened to me the day before yesterday. It happens to me almost every single day. And these are people that are literally just
taking your order or selling you a single item. You go and do an airport, you buy a snack and they're asking for a tip. You go to Starbucks and you're ordering a coffee and they're asking for a tip. Everybody's asking for tips. I think it's out of control. I'm happy to tip a service. If you're serving me, if I'm sitting down in a restaurant and you're serving me and you do a good job, I'm a great tipper.
If you give me a personal service like nails or massage or something like that haircut, absolutely. But the tipping culture and businesses, I don't know. A lot of businesses don't allow you to get reimbursed for all that tipping. You'll have to do it out of your own pocket. So a lot of business travelers choose to do that and some don't. Or maybe there's a limit on tipping in your businesses.
travel guidelines.
Speaker 1 (28:21.198)
Costs for hotels and rental cars are also way up, adding to the overall increased business cost of travel. For a business traveler, a lot of things are kind of back to pre-pandemic experiences. All the good things and fun things about business travel are mostly back. There's still high staff turnovers and in some cases not as many or as extensive of on-site services to the locations that you're going to go. Especially housekeeping staff.
is lower than it used to be. One great thing though, I always try to find the silver lining. If things are not always as awesome as they used to be, there are silver linings in business travel.
One of the silver linings is that most hotels are switching from the tiny soaps and shampoos in the showers. The hotel that you just stayed at, did they have, still have the little tiny soaps and shampoos?
They did, but I've seen what you're talking about where they've got the thing bolted to the wall that's got the holders in it. And I love that they've started doing that because they know that we're stealing the same. They know that people are stealing the soap just to steal it because you can and people end up as it's silly, but that's how people are behaving. So that's how people react in there. They're bolting into the wall, but it makes sense. makes sense to do that as a state of movement and as a cost saving. It's one of those things where both of those.
goals overlap for the company. And that is a cool thing to see.
Speaker 1 (29:53.25)
I think I talked about this in one of the videos that I did on sustainable travel. Back in the day, I would take all those little soaps and shampoos and conditioners and I would donate them to homeless shelters or packages that people would put together for the homeless and things like that. I did that too for a long time. And yes, if you have those things, you can absolutely do that with them. However, every time you take one, you're creating a demand for more.
And all those little tiny plastic things, the odds of those things getting recycled or they may or may not even be recyclable are very, very low. So you're really creating a lot of plastic waste when you do that. So I am tickled pink to see these hotel chains and maybe their motivation is, hey, we don't want to buy 8 zillion of these things every year. Okay, that's fine. They're still providing it for you. It's in the shower. It's on the.
countertop. It's still being provided for you, but it's refillable now. So I'm ecstatic to see that. And it makes my little sustainable heart happy to see those kinds of things.
What can you do as an individual business traveler to make sure that your business travel adventures can continue? You manage your costs responsibly when you're traveling for business. Some companies or clients are going to have very specific guidelines as to what's acceptable and what's not acceptable when you're on business travel. Sometimes they'll say, you can't have any alcohol. Sometimes they'll say one drink.
is all they're going to pay for. They might say that you have to stay in certain hotel chains or rent from certain rental car companies because they have a global deal or something like that. Share cars. If there's more than one of you going to the same place and relatively similar timeline, share cars. It drives me crazy when I'm going with colleagues and we're all meeting in this job site. We all have the same travel schedule, yet everybody rents their own car. What's the reason for that?
Speaker 1 (31:53.208)
We all stay at the same place. There's no reason for separate vehicles. can share or somebody can take an Uber and meet us and then we'll share from there. When it makes sense, ride share is often cheaper than running a car these days, depending on where you are and how long you're renting for. Sometimes I'll look at the costs. think I was in Salt Lake City earlier this year and I was only there for three days and I'm looking at it I'm like, I'm not going to run a car. I'll just Uber to the hotel and I'll walk or Uber to the
event, it'll be cheaper than renting a car. Especially if you have to consider paid parking at your hotel or at the venue that you're going to. I know, and this was years ago, I'm sure this isn't the case anymore. I was in San Francisco, gosh, it's probably been 10 years ago. I flew there and then just did public transportation from there and talk about a great public transportation system. San Francisco has so many options.
but I remember noticing parking there was $50, $60 a day everywhere. And it's probably 80 now, because that was quite a while ago. So that paid parking can really get you. Take advantage of the free coffee and breakfast at your hotel. Most of the decent hotel chains offer that. So definitely take advantage of it. And remember to bring your own coffee cup. That thing fits very nicely in your travel pack.
Bring your own water bottle and refill instead of buying water. There's no reason to spend $6 on a water bottle when you can bring your own. And make sensible choices when you're dining out or you're ordering in. I am constantly surprised at how much a Uber eats order can cost. But compared to eating out at a lot of other places, sometimes it's the more economical option, especially if you have to take an Uber to get to where you're going. There are limits, however.
to what you should be expected to do as a business traveler. No employer or client should ever ask or expect from you to share a room with someone else. I've encountered this one quite a bit, not personally, but friends and colleagues of mine have told me that their employer has asked them if they're sending two people to a conference, both women, they've asked them to share a room. That's not acceptable.
Speaker 1 (34:17.012)
in any circumstance. Now, if somebody is a really good buddy of yours and you really want to, or you're paying for it out of your own pocket for whatever reason on a personal travel, and you want to do that, that's completely up to you. But no employer or client should ever ask or expect that of you. And no employer or client should ask or expect from you to be spending money out of your own pocket for business travel. That's also not an acceptable ask. If anybody's asking that of you,
Do not be hesitant to say no.
We had a really interesting case come up in a business class here at Ross, where we were talking about incentives and productivity and how to manage HR. And it came up that one of the ways that people used to signal that they were really interested in a job is they would fly themselves out to go get that job. And it was later written in the law that you can't use that as a selection factor because then it's just unfair. Some people may be
have more money and if that money is afforded and the privilege of earning the job, then that's not fair. That shouldn't be legal, was what the courts decided. So now if somebody is offering a job and they are having in-person interviews, they have to give you travel by law. If they're gonna give it to one person, they have to give it to everybody.
that's very interesting. That's sort of like unpaid apprenticeships a little bit, right? I don't think those are allowed anymore either or unpaid internships, you know.
Speaker 2 (35:51.374)
There are certain economic conditions where you still see some of that kind of behavior like you have to pay for a taxi license. That used to be a big thing in New York where before you even start making any money, you've got to take on this risk financially. But that has been pulled out of the system even though economics allowed it for a long time.
Well, in almost every business that I'm aware of, you have to pay to play. I think that's where the saying, takes money to make money. You have to pay for your own business license. You have to pay for your own P.E. stamp. You have to pay for your own vendor license or whatever it is that you're doing. yes, those are separate entities. They don't really care whether or not you're making any money in your business.
you have to have a business license or whatever to play. So I did have a colleague who offered to stay at a friend's house during business travel to save business expenses, to save the client some money. And I just told him, no, I said, don't do that. The client wants you there. They've asked for you to come. They can pay for a decent hotel. Motel six is maybe not the answer, but.
You know, don't have to sacrifice your own stuff to do some business travel. Here are some frequent traveler tips to get the most out of your business travel. Kind of mentioned some of these already. Pick one or two airlines that you really like and book all your travel through them directly. Set up frequent flyer accounts so that you can accumulate mileage and get some personal free trips and perks out of it. One of the great things about business travel is that there's an opportunity to get a lot of
out of it for you, your personal self that you can use for your own vacations and your own things. Do the same with hotels and car rental companies. Pick a company or two. If your company requires you to use company A, company B, that should be one of them. And then pick another one as an alternate. Just because sometimes there's not availability or it gives you a price point to compare against. I always compare.
Speaker 1 (38:02.392)
the cost of United and Southwest if there's a specific destinations that I'm going to. And you'd be surprised how many times United is cheaper than Southwest.
I would say find a great points or rewards credit card and use it for all your business travel expenses. Now this may also be the same thing as your credit card. know, it could be an Amex card, it could be like a United credit card or Southwest credit card or something like that, but it might be something different. You have to choose what's best for you. Find it, use it. It simplifies your expense reports to have all of your business travel on one credit card.
And then you can keep those rewards and use them for vacation or whatever you choose. Whatever kind of reward you choose, sometimes you can get gift cards out of it. I've bought Christmas presents with the points. I've done all kinds of things over the years. Amex has a decent points program that can be redeemed in a number of ways, including travel, gift card, statement credits, purchases. I mean, if you have a
a business and a personal Amex card, you can link those two and share the rewards between those two accounts. United and other airline cards give points for all dollars spent that convert to miles for free travel and companion passes. If you've never had a companion pass, you want one of these. It's super cool. If you fly enough and granted you do have to fly a lot to be able to earn one of these companion passes. But what companion pass is,
You pick a buddy and it can be anyone. It can be your spouse. I could pick you, Brad. And that person, that identified person gets to fly for free anywhere you go. So you have to fly with them. can't go on their own. My husband, of course, was my companion for several years when I had companion pass and I identified him on there. And then I would book my ticket and then I would book a companion pass for him. All you have to pay is the taxes, which is about 11 bucks round trip.
Speaker 1 (40:03.404)
It's dirt cheap and he could go anywhere I went for free. So it's a great deal. You can also get club access as we've mentioned. AmEx has great lounges. United has great lounges. Sapphire has great lounges. And I believe there's several others that I can't think of right now. And so different airlines and different credit cards partner up and give you access to some of these lounges. So check that out.
Booking through online travel sites is not a good idea for business travel. I don't even recommend it for personal travel. Here's why I learned something super cool a few years ago. If you book through a third party site like Travelocity or any of those kinds of places, you're the first to get bumped from the airplane.
And I did not know that. So people that are screaming and yelling, they're getting bumped from airlines. It's because they booked through a third party. So I learned that from a pilot a few years ago. And I, mean, I never used those services really anyway, because the reason that I don't like using them, I had a bad experience. I think I can't remember which one I used. I needed to change my flight or my hotel or whatever it was. Trying to change it after you've booked it is a nightmare.
on these sites. You can only do it through them. The hotel or the airline can't help you because you've booked it through a third party. There's also airlines that will not even book through a third party. So I know for a fact, Southwest is one of them. So just be conscious of that when you're booking. It's really difficult to make changes to your plans once they're made.
I gotta tell you, you're not guaranteed your best prices for major chains like Marriott, Hilton, and Hyatt. Some of the cheaper hotels, maybe, but if I go to those discount ones and I look up Marriott and then I go to Marriott's website and I log in through my Marriott account, I can tell you that often I will get a better deal through my own account direct with the host.
Speaker 1 (42:16.31)
Anything to add, Brad?
Yeah, I had a really interesting business case in a strategy class here at Ross. We debriefed what Chase Sapphire was trying to do when they first launched that credit card. At the time, American Express was the leader in premier travel cards, but it wasn't really appealing to the younger generation, my generation, the millennials. And Chase decided to invent the Sapphire card to
Go after that market to take that market away from American Express and the fight that they had to make internally was we want it to be great for them from a travel and points and rewards standpoint. But we also need to attract the people who make us the money who pay their credit cards off late and then we charge on that 20 % and. That's the thing to keep in mind when you're thinking about all these credit cards. OK, somebody is paying for these. Points that I'm getting.
And they're the people that are doing that. Each of these credit card companies has a different strategy about how to attract that 20 % paying group. And they're going to go after different parts of the market with their point strategy accordingly. So when you go to do the math about which credit card is right for you, or you get confused and say, well, this one has double points here. That one, if you sit down and do the math and work through how you spend on whatever credit card you have now,
and compare to how much more in points and benefits you might be getting on a different credit card. That's the best way to approach whether you're in the right credit card for you from extracting that value standpoint.
Speaker 1 (43:59.534)
Absolutely agree. Before I got an airline credit card, I talked to my friends Ron and Gina. They are extensive international travelers. are, I swear they're on an international trip every other week, it seems like. And I asked them, what airlines do you guys typically fly with? Because they've got a lot of experience and I wanted to make sure that I picked an airline that had a lot of international destinations because
we want to start doing more international travel. And I asked them what credit cards they use and how did they pick and which ones do they like? And so they gave me their list and they used a couple different ones because depending on where you're going, one is not going to go everywhere you want to go. So you do need to think about getting more than one or at least having that airline accounts with more than one, even if you don't have a credit card and then looking at all their different options. And absolutely, you need to look at things like their points, their rewards.
What kind of multiples do they have? How are you going to spend your money? Are you going to spend a lot of money on airline tickets like I do? Or are you going to spend most of your money doing other kinds of shopping? You definitely want to avoid paying that interest if at all possible. I didn't even mention that. They're all going to have high interest. We pay our stuff off every month, highly advisable so that you're not paying that interest. But it costs a business money to take your credit card.
All businesses have to pay a per transaction fee and a percentage fee for being able to take a credit card. Amex is more, it costs a company more to take Amex than it does to take any other card. And the reason is the benefits that Amex offers. They turn around and put that money back into the Amex clientele with great benefits and things like that. But as you said, they're getting a run for their money from some of these other cards.
You got to look at, know, what can they offer you? Can they offer you access to a lounge? Can they offer you free luggage? That's a huge benefit that I get. Benefit alone on my card with as much as I travel is worth the fee that I pay for the card.
Speaker 1 (46:12.545)
100%. I get three free bags every time I travel, which I hardly ever have more than one. But even with one, if I paid $35 every time I checked a bag, as you get up in the tiers, you start getting more and more benefits. Well, I get now I get preferred seating and now my travel companions get preferred seating and now we all get free bags and it just keeps going. And it's really very beneficial as you go on. So
Definitely explore all that as you're looking at what credit card options might work for you and what benefits will be good for you. Have you picked one yet, Brad?
I am ashamed to say that I picked my credit card based on the member sense marketing that American Express uses. When I graduated from college, I was very proud to have a job that I knew was gonna keep me afloat. And I planned on building credit for the sake of being able to have a credit score to go buy a house someday. And that was something my parents taught me. It's not just about having somebody who has no credit.
even though they're trustworthy person may not be able to get alone because they don't have the credit history. So I wanted to build that credit history. And we've gone on this amazing trip to Italy for my parents 25th wedding anniversary. My mom's, it was a big birthday for her and American Express as part of the reward program had done a lot of the travel planning. And I just thought that trip was fantastic. So I wanted to have that member sense. I wanted to have that travel card.
I wanted to build a credit. that was my choice. It's probably a pretty good credit card based on what I've read about it since their YouTube videos. The points guy does a great breakdown of who is best for what kind of card. And I'm able to do some pretty good things with the points. But I have not been spending all that much money in grad school. So I haven't thought about it very hard these days. I maybe once I'm back into the money making world, salary earning world, I'll take a closer look.
Speaker 1 (48:22.186)
Amex is a great card and they will act as your travel agent and book your travel for you and do all those things. I've had great experiences with them. I have used them as a travel agency before. Whenever we get ready to go on a big trip, I cash out all my points into Amex gift cards and we use them on our trip to help curb some of the out of pocket costs.
of the actual trip that we're taking. yeah, there's lots of ways that all that stuff works. And we limit our cards. I've got three personal credit cards and three business credit cards. And I kind of spread the love a little bit. And they all have their pluses and minuses. But business travel.
Super fun if it's your jam and go out there and look at maybe doing some conferences this year. Look at going and doing some face to faces with some of your clients, visiting some of your sites, whatever it is that you're going to do in your business travel. Don't forget your sustainability and bring your coffee cup and your water bottle. Right here, coffee cup and water bottle and make sure that you never leave home without it.
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