PORTLAND, Ore. (TheStreet) — Business travel hasn't quite recovered from the recession, if the latest round of expense reports are any indication.
Redmond, Wash.-based travel and expense management company Concur looked over data recently from 15 million of its business travel users and found 500 million expensed items that added up to $50 billion in travel spending last year alone, despite some bumps: Average U.S. spending on business airfare that jumped 6.6% in 2012 dropped 8.2% a year later, and spending on hotel rooms that jumped 4.15% in 2011 slumped back nearly 4% the following year. Those two categories alone account more than a third of all business travel expenditures.
Travel costs are much greater for small businesses — 24% greater — because big businesses can negotiate better rates with hotel chains, negotiate volume pricing with car rental companies and basically throw a lot more weight around.
Concur finds that the cost of entertainment and vehicle rental for small businesses is a whopping 57% and 75% higher, respectively. Small businesses are taking more trips, paying for more events and renting more vehicles per quarter than the big guys, and it's putting them at a big financial disadvantage.
While Superstorm Sandy and the fiscal cliff negotiations weren't helping costs when Concur put together its survey, it's clear that some costs jumped nationwide. In certain cities, it claimed far more of companies' travel expenses than it others. With help from Concur and the data it's gathered on such things as average meal costs and the expense of getting into town from the airport, we found the 10 most expensive destinations for business travelers and their expense reports:
10. Santa Clara, Calif.
Average travel spending minus airfare and car rental: $331
Silicon Valley has one of the cheapest meal expenses on this list at $35 but charges a garish $50 on average to get a ride from the airport. Unfortunately, if you do face-to-face business with Apple to get your company's product integrated into the next iProduct, you have to go to Santa Clara and hike it over to Cupertino. You can still fly into San Francisco, but it'll cost a business about 25% more in travel costs to make the trip. Meanwhile, Intel, Google, Oracle and other tech heavy hitters have no problem being parked in the middle of the valley, forgoing the nightlife in San Francisco for a bit by being in Santa Clara. Yes, lots of young valley professionals still take their freshly lined pockets up to San Francisco condos when the workday's over, but even the San Francisco 49ers can see where the base is shifting. The team calls Santa Clara home starting this year and has opened the corporate suites at its new Levi's Stadium for business.
9. Las Vegas
Average travel spending minus airfare and car rental: $336
There are big sections of the Las Vegas calendar where hotel rooms can be had if you just ask politely. That goes a long way toward explaining the $98 average lodging cost which, in this city, is still a bit steep.
Granted, Concur is only going with the costs that appear on the expense report, and last we checked companies weren't comping a few hands at the blackjack table or a bunch of roulette wheel spins. Even without factoring in those costs, the $166 that Las Vegas business travelers shell out in entertainment expenses are the second-most in the country outside of New York City.
Those tickets to Britney Spears, Donnie and Marie, Jerry Seinfeld and Cirque du Soleil don't pay for themselves.
Average travel spending minus airfare and car rental: $344.84
First off, if you're the lucky laborer whose company sends him or her to Miami on business — especially during the winter — congratulations. Not only did your employer send you to a warm-weather paradise on business, but they have enough faith in your ability to get the job done to spend $118 on a hotel room and a whopping $149 on your entertainment expenses alone. Business travelers don't tend to spend that much on food anywhere in the country outside the New York metropolitan area and San Francisco, but all those South Beach clubs and bottle service come at a price.
Average travel spending minus airfare: $345.85
There isn't one big item that makes Chicago costly, just a lot of little ones that add up.
The $36 dining average is remarkably low for a town that's home to a Michelin-star restaurant like Alinea. Unfortunately, if you want to head out a show at Steppenwolf, a day at the museums or a Bulls, Blackhawks, Bears, Cubs or White Sox game, it'll set you back an average of $144.60. That's somewhat low for a city of Chicago's size, but it still requires a big-league business budget.
Meanwhile, Chicago's $132 hotel price is the highest on this list so far, outdone by only a New York City suburb coming along soon. Not the most expensive and not the least, Chicago does the Midwest proud by falling somewhere just shy of the middle.
6. Long Island City
Average travel spending minus airfare and car rental: $359
A tip for Concur: This is Queens. A borough of New York City.
We realize that to the out-of-town business traveler, its position on the opposite side of the East River from Manhattan must make it seem like a distant land teeming with two-story homes, diners and industrial buildings, but trust us: It's still very much New York City despite what some kid from Ohio who says he's from Greenpoint tells you.
Seriously, it's not even like this is some distant point in Queens, either. It isn't the end of the R line in Forest Hill. It isn't a Mets game in Flushing. It's not even a diner in Astoria. It's the closest you can get to Manhattan in Queens without actually leaving Queens itself. You can still take the N, R or V train in!
We tell you this because it's going to explain some things. Of course the $27 cab ride from the airport costs less than the $36 price in “New York City.” You're closer to JFK and LaGuardia and you're not taking any of the East River crossings to get there. Of course the lodging ($150), entertainment ($141) and dining ($42) costs are less expensive. As you're about to discover, it takes a whole lot of effort to go into Manhattan, spend money and get home at a decent hour. Chances are you're cutting out a bunch of costly Manhattan meals by catching an occasional bite in Queens and you're cutting your night a drink or two short just to beat the sun back home.
In New York terms, it's as big of a discount as you're going to get without leaving the city. Considering it's still more expensive than Chicago or Miami, however, you're not getting that great a deal.
Average travel spending minus airfare and car rental: $369
With tech companies lining its Route 128 corridor, biotech companies clustered around Kendall Square in Cambridge and financial firms still calling Boston proper home, Greater Boston was built for business travel. It's also built like a giant tollbooth for those same travelers, taking huge bites of of their per diem at every turn. Its average $145 hotel cost trails only New York, Washington and San Francisco, while the $144 companies spend on tickets to shows, duck boat rides and Red Sox, Celtics and Bruins games rivals only their entertainment budgets for San Fran and New York-area stops. That's some strong extracurricular spending in a town where “late night” bars close at 2 a.m.
4. Washington, D.C.
Average travel spending minus airfare and car rental: $374.29
Avoiding business in the nation's capital is nearly impossible if you deal regularly with the nation's regulatory bodies, the military or even your local representatives. Unless you plan to camp on the National Mall, conducting business in D.C. is pretty costly as well. The average $164.14 businesses spend on lodging there per trip is the second-highest among all U.S. cities, and that doesn't even count the second-in-the-nation $44.45 cost of getting to and from the airports.
3. Garden City, N.Y.
Average travel spending minus airfare and car rental: $389
So you need to send an employee to New York for a conference but don't want to spend New York prices to get them there? Putting that employee 18 and a half miles away from Manhattan on Long Island will cut costs, but you're really putting some faith in the town's five Long Island Railroad stations. Garden City may look like the Roosevelt Field Mall and a whole lot of nothing, but a whole lot of businesses use this town as a cheap way into NYC. The town knows exactly how close it is to “the city” and just how much folks will pay for a discount. Sure, the average $106 cost of a hotel room is almost half the price of a room in New York City, but the $72 cost of getting to and from the airport is almost double that from Manhattan. Meanwhile, the $66 average Long Island meal bill makes Manhattan's $65 tab look almost suburban.
2. San Francisco
Average travel spending minus airfare: $407.04
As one of the most expensive cities in the U.S., period, San Francisco isn't surprising anyone by showing up at No. 2. A day at Fisherman's Wharf and a night at a Giants game turns quickly into a $166 affair on average. Savvy business travelers know how to keep those costs down, though. Hitting the burrito stands or sticking to a beer and garlic fries at Gordon Biersch keep average San Francisco meal spending below $44 and more affordable than Long Island City or Garden City — though costlier than Santa Clara. The $39 cost of ground transportation to the airport isn't cheap, but it's still a $2 discount over what fellow travelers are getting in Boston and well short of that $50 cab ride to Silicon Valley.
1. New York
Average travel spending minus airfare and car rental: $470.16
Its $194 average hotel costs are the highest in the country, the $174 spent on entertainment tops the list easily and the $65 average dining charge is only outdone by the city's jealous suburban neighbors on Long Island. So why pay it? Simple: Try replicating the experience anywhere else. Its tough to replicate the impact of getting clients tickets to a Broadway show, a game at Madison Square Garden, a concert at Carnegie Hall or Lincoln Center, a gala at the Met or MoMa or any of those other New York-specific experiences that tend to stir the senses and open purse strings. You can conduct business at any chain hotel or office park in just about any sprawl patch in the United States. You conduct that business in New York when you want to pull out all the stops. Besides, to many of your international clients, this Big Apple basically is the U.S.
— Written by Jason Notte in Portland, Ore.
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