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Recovered Business Post Covid: Travel, Transport and Logistics

April 10th, 2021
Travel, Transport and Logistics

Recovered Business Post Covid: Travel, Transport and Logistics

April 10th, 2021
Travel, Transport and Logistics

Business trips and travels are so important for many people but due to the corona virus, it will take a long way before it reaches its previous levels. This is what we are supposed to know:

When the covid-19 hit and made the individual trips stop, many businessmen and travelers needed to communicate with each other so they started using online platforms. As the pandemic reaches different spots as fast as it can, we estimate that it will take a long time to become normal all around the world again.

Business trips are important and fragile

In the year 2018 business trips value was more than 1.4 trillion USD which half of which was centered in North America and China. These trips and travels consist of different meetings, events, conferences, and industry exhibitions. Groups and business trips have an important role and are beneficial for hotels. But on the other hand, some travel providers may have limitations for business voyages. Generally speaking, group and business trips are valuable because they tend to book high-class hotels like 4 or 5 stars and reserve business and first-class spots in airlines so based upon the statistics their profits are about 50 percent although their numbers are as few as only 10 percent of the passengers.

Group voyages are more vulnerable and after a pandemic or any other economic crashes, it takes more time for them to get recovered rather than other leisure and typical trips. For example, after the recession in 2008-2009 in the United States, business travels were reduced more than 13 percent but leisure ones were decreased only 7 percent and by the way, it took only 2 years for leisure travels to be recovered but it was more than 5 years for business travels. 

According to the modern technologies and fast bandwidth and advanced online methods of connections during the covid-19 pandemic, it will take a significant time for business voyages to be recovered and there is a long way ahead.

Business voyages will be recovered at the end but step by step

When could-19 became pandemic in the world, many large companies put some restrictions and limitations on traveling and made exceptions for only certain VIP people. In late 2020 American Airlines claimed that it had a 70 percent passenger reduction which is 4 times bigger than the events after 9/11 in 2001 and six times larger than the recession in 2008-2009.    

Many companies are being prepared to help government rules and regulations, healthcare centers, and safety policies to facilitate the ways of traveling during and after the pandemic. Several investigations show that these areas can be so helpful to reduce the restrictions and make voyages easier than what it is nowadays but again it will have many phases.

Voyage planners are trying their best and up to now, they have noticed different sections of business travels which eventually these sections will be recovered due to the purposes and goals of travel voyagers but still it is going to be slow and long.

Endemic and regional business trips recover first

When we see the distance and the difficulties of business travels, we might assume that domestic and short distance travels are more likely to happen. Conforming to GBTA (Global Business Travels Association) international business trips are halted two times more than domestic trips in 2020. In endemic voyages, people can decide on their own and can travel by their cars and vehicles but international ones mostly require corporate programs and long-distance flights.

Travel agencies centered in Asia confirm that domestic trips are about to be fully recovered in those areas that have stabilized after the pandemic and now their citizens have overpassed the hazard of Covid-19. For example, they claim that during the pandemic in China, domestic trips were decreased more than 70 percent but nowadays the conditions have reached normality and the whole regional travel has recovered as well. 

On the other hand, international voyages will take longer to be recovered due to the intricacy of the government’s rules and regulations and the border policies, and the high-risk chances of contaminating other nations. Even though some countries in Asia have considered special rules for international traveling even during the Covid-19 pandemic and based on some strict protocols a few international voyagers can come and visit these countries.

Business trips for person-to-person sales will be recovered second

Although some important and critical business travels were active during the pandemic (such as chain supply industries), we assume that sales and client-related meetings will be returned after the recovery of regional and domestic voyages.

Organizations that have focused on sales are trying their best to establish person-to-person meetings but they have to enforce some policies because both sides must feel comfortable and for each side, all the requirements must be provided. Face to face business meetings may even take longer as we thought to be recovered because right now many companies and enterprises and businessmen are doing this job online and with advanced technologies and modern infrastructures, they don’t need to spend so much money (for example for booking hotels and flights). We presume that online meetings will take the place of face-to-face meetings more soon. The moment that situation turns and pandemic is gone, everything will become different. Many conferences and meetings and even trips will replace their actual place with virtuality connections.

Corporation business travels are the last sort of voyages that will be recovered because it requires a minimum risk of infection and high public safety conditions and generally all the government restricted regulations must be eliminated for this matter. Statistics show that China and South Korea have hosted thousands of visitors for many exhibitions when the Covid-19 cases decreased and went below 50 cases per day.     

 Affected sections are the last to resume corporate and group travels   

Different sectors have their effects on recovering the group travels. Based on their roles and aims, by using advanced technologies they can make the normal traveling returns as fast as possible. Moreover, some industries that are focused on energy were hit harder during the covid-19 pandemic and again they might face budget constrain during the post-pandemic.

Production-based and industrial sectors (for example real state and constructions) will return sooner. Based on the experience in China those mentioned sectors will rebound sooner than the others.

How can voyage providers become ready

Business voyages have a long way to be recovered. As long as the world is changing at high speed. All industries must have a flexible view toward the future and comprehend when different sections will be recovered first. To reach this perspective, industries must contact their customers and be aware of what they are about to do, and understand their intentions so company leaders can make the best decisions. For instant airlines must modify their prices to become more acceptable by different passengers (economy, business, and first-class). No matter when all business sections are recovered, all the enterprises and industries must renovate their policies for all sorts of traveling including business and leisure voyages. 


 Article by: Amir Masoud Navidi


 Adapted from: Mckinsey&Co.

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