U4B Saves Companies $1,000+ per Employee EVERY YEAR

 

While we are used to fast growth, we’ve been amazed by the adoption of our new Uber for Business (U4B) product. In just over two months, we’ve had thousands of businesses sign up, representing hundreds of thousands of employees. If U4B were a city, it’d be the 3rd fastest growing city of all time by cumulative fares.

We dug in to the numbers to find out why the growth was so strong, and it became clear: Companies are saving a lot of money. More specifically, when we examined all of this U4B usage, we came across this interesting cost-conscious finding:

The majority of U4B trips are on uberX, which is cheaper than a taxi in all US markets.

This breakdown is similar to what we see across our entire platform. In other words, what’s happening on Uber for the boardroom is a reflection of what happens on Uber across the board. We already know that using U4B saves time. No more collecting receipts or filing and verifying manually-entered expense reports.

But as companies switch from ad hoc taxis and limo services to Uber’s enterprise platform—in particular uberX—they also see significant financial savings. To extend our earlier analysis we determined how much money a typical company can save by moving to U4B and found that:

A typical company can expect to save over $1,000 per year per traveling employee by moving with U4B.

 

Our Estimated Savings Average

To be exact, our assumptions provide almost $1,500 worth of savings per employee per year. With U4B, you have high Estimated Savings Averages (ESAs) and low ETAs. How did we get there? Here’s a brief breakdown on where the savings come from, and our assumptions:

 

Annual Fare Savings

Even businesses that use taxis rather than limos realize significant costs savings by using uberX on Uber for Business. Using the below assumptions, we get savings of $900 per employee per year, for 60% of the total savings.

Metric      Amount
Typical Trip Fare¹      $30.00
Estimated U4B Savings²      30% savings
Average Trips / Week³      2

 

Annual Employee Time Savings

Businesses see substantial time savings from the seamless end user experience, and partnerships with companies like Concur facilitate the expensing process. Using the Bureau of Labor Statistics annual mean wage ($46,440) as a proxy for average employee salary, we see that time saved from filling out expense forms and waiting for taxis and limos gives companies over $447 worth of employee time back, which can be used to do their jobs. This represents about 30% of the total U4B savings.  (We don’t include time spent negotiating pre-arranged ride contracts, a non-trivial periodic cost.)

Metric      Amount
Waiting Time Saved per Trip¹      10 min
Monthly Time Saved with Easier Expensing²      13 min
Avg Employee Salary³      $46,440

 

Reduce Non-Compliant Expenses

Finally, businesses save money by ensuring that all trips are taken for business purposes and that employees are reimbursed accurately. This accounts for the remaining 10% of savings, about $150 per year per employee, using an independent source which suggests that 5% of expense transaction values are out of policy.

Metric      Amount
Approximate % of Non-Compliant Expenses¹      5%

 

Calculate Your Own Savings

Above, we estimated how Uber for Business could save companies almost $1500 per employee per year. To get more specific, we’ve made the below calculator to demonstrate how much your business could save using our baseline assumptions:

Refer your business network  and you could ride for free for life.

Note that we use the Bureau of Labor Statistics annual mean wage to estimate the value of time saved by employees. We also use a 30% fare savings, based on the average difference between uberX and UberTAXI fares we have seen to date in San Francisco, our oldest city with the most comparative data. (Other ground transportation options and pre-negotiated limos/livery services, in addition to other cities like Chicago or Los Angeles, should yield higher savings.)

 

“Uber for Business has been integral in helping Standard International streamline company travel, realizing expense savings, controlling expenses and increasing team productivity by freeing up time from expense reporting. Working with Uber has really put the pedal to the metal with our team.”

Joey Jalleo

VP, Culture & Communications

Standard International

 

Create a business account now and join the Uber movement.

 

Appendix

Annual Fare Savings

¹ Estimated combo of taxi fares & negotiated limo ride rates ($30-60/trip from data provided to us by other companies). This is a starting point — use the calculator to customize your current cost.

² Based on uberX price difference from uberTAXI in San Francisco from all trips done to date (this estimate includes surge). Cities with more spread out urban areas such as Los Angeles and Chicago can expect higher % savings.

³ Based on U4B data, most people use U4B multiple times (at least twice) a week.

Annual Employee Time Savings

¹ Use 15 min avg wait time for a taxi SF Municipal Transportation Report Draft, 2013 (varies depending on time of day and hailing/dispatching). Pre-arranged rides are frequently late or no-shows as well. Uber across all cities is < 5 min (less for SF) but we use 5 min for a 10 min savings.

² Pg 17 T&E Expense Management, Aberdeen Group, 2008. 28 min/month doing paper expenses, as typically receive from a taxi and some limos, vs. 15 min doing expenses electronically. Importantly, you can expect more using a service like Concur with U4B which automatically pre-populates expense info.

³ Bureau of Labor Statistics, May 2013.

Reduce Non-Compliant Expenses

¹ 6% of transactions and 5% of transaction value. T&E Spend Analysis Report Vol. 1, Oversight Systems.