As international borders reopened, many travel management companies and suppliers reported that it was small and midsized businesses who were first out of the blocks.
Even in the second quarter of 2022, SMEs' business travel spend remains well ahead of larger companies when compared to pre-pandemic volumes.
American Express recently reported that spending on travel and entertainment among its small and midsize business customers
Spending on travel and entertainment on American Express corporate cards by the small and midsize corporate segment exceeded pre-Covid levels from the second quarter of 2019, the card supplier said in its recent Q2 report. While such spending by large and global companies remains well below 2019 levels, it nevertheless increased notably from the first quarter, according to Amex.
Small and midsize enterprise T&E spending in the second quarter was 108 per cent of 2019 levels, according to Amex. Spending on Amex corporate cards by the large and global corporate segment, meanwhile, was only 60 per cent of what it was in the second quarter of 2019, albeit up from 38 per cent in the first quarter of 2022. American Express CFO Jeff Campbell called that uptick "a sign of a more meaningful business travel recovery."
"We don't see demand in the T&E categories declining significantly anytime soon," added American Express CEO Stephen Squeri, "based on the strength of future bookings coming through our consumer travel agency and the trends our partners in the travel industry like Delta are experiencing, particularly in the premium space."
Total second-quarter spending on American Express corporate cards was $153.1 billion, up from $135.7 billion in the first quarter and up 28 per cent year over year. T&E-related spending during the quarter made up 26 per cent of volume on all Amex cards worldwide, up from 23 per cent the prior quarter. Airline-related spending comprised six per cent of all second-quarter volume, up from five per cent in Q1.
Travel management companies have also noted the performance of SMEs. Newly public American Express Global Business Travel reported that transactions among its SME customers in the last three weeks of April had recovered to 80 per cent of 2019 levels, compared to just over 60 per cent for larger companies and 72 per cent across all customers.
And SME-focused Corporate Traveller, part of the Flight Centre Travel Group, had a "record best month" in March this year, signing 81 new customers, all SMEs, "supporting the claim that SMEs are key to the UK's post-pandemic recovery, with a full return to business travel a definite reality for many businesses".
The TMC says customers in the entertainment, sports and creative sectors didn't stop travelling during the pandemic, while SME businesses in the finance, consulting, tech, manufacturing and engineering sectors are currently among its biggest spenders. Top destinations for its UK-based SMEs are currently New York, Dubai, Amstersam, Los Angeles and San Francisco.
Speaking on Hilton's full-year 2021 earnings call, meanwhile, CEO Chris Nassetta noted that large corporate customers were still some way behind small and medium-sized businesses. He said: “We found that surprisingly large corporates disappeared, but the SMEs were still out there more than others. Why? Because their business requires them to be out there.”