Hoteliers Rejoice: China's Business Travel Budgets Remain on the Rise

    The anti-corruption campaign and economic growth slowdown haven't stopped corporations from upping their travel and entertainment spending in China.
    Travelers at the airport in Beijing. (Shutterstock)
    Jing DailyAuthor
      Published   in Travel
    Travelers at the airport in Beijing. (Shutterstock)
    Travelers at the airport in Beijing. (Shutterstock)

    Despite China’s ongoing economic growth slowdown and anti-corruption campaign, companies in China are still upping their budgets for travel and entertainment—albeit at a much slower pace than before the campaign began.

    The latest “China Business Travel Survey” released this week by CITS and American Express Global Business Travel finds that Chinese corporate travel and entertainment budgets rose 4.8 percent this year. This rate has increased since last year, when budgets grew by 3.1 percent. In addition, a growing number of companies are raising their budgets for travel and entertainment—while 34 percent increased their spending on these expenses in 2014, a total of 43 percent did so this year. In addition, only 12 percent reported decreases, down from 17 percent last year.

    “Our research indicates companies are increasing their annual T&E budgets, despite the challenging economic environment in China,” says Marco Pellizzer, the vice president of American Express Global Business Travel, mainland China & Hong Kong.

    Despite the increase, paying for travel is being seen as more of an “investment” than a necessity for a growing number of companies. A total of 49 percent of corporations surveyed view it as a investment, marking an 11 percent increase from those that said the same last year.

    As Chinese companies become increasingly global, spending on international trips increased 6 percent this year. “The inbound influence and outbound impact of China’s economy within the rest of Asia is apparent, and it is increasingly clear that China no longer operates simply within its geographical boundaries,” says Pellizzer.

    Hotel companies aiming to maximize the benefits of lucrative corporate travel budgets should look toward online bookings, which are becoming increasingly used by corporations. The survey found that 89 percent of companies book through online tools, with the majority of them using ordinary online travel agents. Online travel booking services designed specifically for corporate travel are used by only 42 percent of businesses. Corporations are also showing increased favoritism for the booking tools they use: 40 percent use one primary agency, which is up from only 18 percent last year.

    In addition, business travel booking is also heavily influenced by the mobile trend in China, with 57 percent of businesses saying that a mobile app is “critically important” when choosing a travel agency. This is because while “business leaders in China continue to recognize the importance of travel when it comes to their organizational growth,” says Pellizzer, “they’re seeking to maximize their spending by adopting technology tools to make their travel programs more efficient.”

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