There was a reduction in business travel expenses in 2020 as data obtained from the audited financial statements of the top 30 companies listed on the Nigerian Stock Exchange (NSE) known as the NSE-30 showed that travel expenses dropped by 36.97% from N49.54 billion recorded in 2019 to N31.22 billion in 2020.
The expenses include flight tickers, hotel expenses, cost of renting and maintaining private jets, local interstate and intrastate transportation, etc.
According to reports, 30 companies were considered with only three of them increasing their travel expenses in 2020.
Guinness increased its travel expenses by 283.1% from N261.4 million to N1 billion in the review period, Nascon Allied Industries and Presco Plc incurred a sum of N91.8 million and N2.02 billion in travel expenses, representing a 125.2% and 33.7% increase respectively.
On the other hand, MTN Nigeria recorded the highest decline in travel expenses, reduced by 79.9% to stand at N964 million as against N4.79 billion recorded in 2019. Stanbic IBTC followed with a decline of 60.95% to stand at N676 million.
Note that some companies were not included in this study as they did not disclose their travel expenses during the period under review.
Research findings have shown that the drop in travel expenses was expected as the entire private sector experienced a lockdown for most parts of the year due to Covid-19.
The Federal Government had introduced movement restrictions on land, sea, and air commute in response to the spread of the Covid-19 virus.
This resulted in the cancellation of business travel expenses across the commercial and political nerve centres of the country.
Bearing the brunt of this cut in expenses were airlines, hotels, and the entire travel industry who suffered massive revenue losses.
The travel industry has been one of the worst-hit sectors due to the COVID-19 outbreak with lockdowns, travel bans, restrictions, and quarantines, which have had a severe impact on business travel for corporate entities in Nigeria.
High travel cost implications, hotel rates, and reduction of airline services also made companies resort to phasing out in-person meetings and business travel, as it is more affordable and productive to go digital.
The deployment of technology has helped companies cut their travel expenses since part of the key reasons for business travel is for conferences, meeting suppliers and customers.
Going forward, video calls show strong potential to replace in-person meetings, resulting in fewer business travels.
