UK businesses remain optimistic despite economic storm warning
9 April 2008
UK businesses are less pessimistic about the state of the economy than analysts may suggest, according to research from the annual Barclaycard Business Travel Survey.
Despite widely reported fears of an economic slowdown, the Barclaycard Business travel survey reveals that 44 per cent of respondents travelled more in 2007 than they did in 2006. And one in three respondents (33%) plan to travel more in 2008 than they did in 2007. Overall, the majority of respondents (77%) anticipate travelling the same amount or more in 2008, with 36 per cent citing business expansion in the UK as the main reason, and 31 per cent citing overseas expansion.
While business travel may be on the rise, however, spending is under closer scrutiny, with business travel no longer meaning ‘business class' travel. More businesses are focussed on managing and minimising costs, with more than half (55%) saying they are most likely to fly economy class when travelling for business. This compares with 46 per cent in the previous year.
Over the 12 year history of the Barclaycard Business Travel Survey, business class travel has reduced significantly. In 2001 41 per cent of respondents cited business class travel as their main class of travel when travelling by air. Six years later just 11 per cent now travel business or first class.
Denise Leleux, Director of Commercial Cards, Barclaycard Business said: "Travelling on business to expand into new markets or win new business has always been an indicator of economic confidence. This year's results show that confidence is still there and that business people are still positive about economic and business growth. But they are also becoming even more cost conscious - perhaps more so this year than before. And it is clear that the long term impact of premium economy services on many long-haul scheduled carriers is continuing".
A growing number of cost conscious businesses are opting for no-frills airlines such as easyJet and Ryanair over the traditional carriers such as British Airways and Virgin Atlantic. While British Airways remains the most used airline for business travel (28%) both easyJet (ranked 2nd) and Ryanair (ranked 3rd) have increased their market share. easyJet recorded a year on year increase from seven per cent to 15 per cent, and Ryanair from three per cent to eight.
Luxury, all-frills accommodation is also on the decline for business travellers, with more than half (54%) choosing hotels based on value for money. Indeed, 49 per cent said that the cost of a hotel was the sole factor when choosing accommodation.
The average CEO is travelling more, recording 2,152 miles travelled per month compared to 2,000 miles per month in 2006
The most frequented business destinations were in Europe (44%) and in the UK and Ireland (78%)
15 per cent of respondents flew to the US and Canada, 9 per cent to Asia and 1 per cent to Russia. In comparison, in 2006 21 per cent flew to the US and Canada, 10 per cent to Asia and two per cent to Russia
The Welsh flew the most in the year with respondents averaging 16 international and domestic flights, while respondents from the South West were the least frequent fliers with 12 international flights a year.
