THE PARTICIPANTSThe Debate
CHRIS POUNEY FOUNDER, SEVERNSIDE CONSULTING
travel industry is again required to invest significant costs to bid for further frameworks, with no guarantee of any business. Typically the private sector will, in advance of determining the travel specification and require- ments, engage with the industry to understand the latest trends and developments and use this market expertise to inform the development of the strategy. This approach is rarely used in the public sector, and in the case of any collaborative public sector procurement where engagement does take place, it is often with only the larger and multinational companies. Unlike the public sector, the private sector seems to understand that improved service and value for money doesn’t come from demand aggregation but is driven by flexible service solutions that meet specific and individual company requirements. This understanding in itself drives a totally different selection criteria and doesn’t prohibit the smaller and more niche suppliers from providing their unique products and services as and when they are appropriate. This is something the public sector could learn. It is worth noting that public sector negotiated
air fares and hotel rates can be accessed by any TMC, not just those listed on the current frameworks. Perhaps that is why, even though Chambers Travel is not on any of the current framework agreements, it has still grown its revenue from public sector business by £8million over the past 18 months, adding four new major clients to its portfolio. There are clearly some smart public sector buyers who realise that improved value for money can be achieved through establishing their own bespoke service and contractual arrangements. If the public sector could consider the impact
through a sharp focus on cost and value for money, but I’m not sure it’s a case of one sector teaching another, more the ability to look at best practice wherever it exists and replicating it. Our account managers have been involved in
some excellent buying processes with our customers over the last 18 months and in each case there have been some fundamental principles I would encourage any public sector business travel buyer to really focus on. Firstly, value for money versus cost. This is about being really clear on what is important to the individual buyer, and it needs to happen before looking at the cost as it will ultimately drive buying behaviour. For example, focusing on the cheapest rate might reduce cost at the point of purchase but does it deliver on other criteria of importance, such as duty of care? Secondly, look at the total cost. Again, the
" It is worth noting that public sector negotiated air fares and hotel rates can be accessed by any TMC, not just those listed on the current frameworks"
of their procurement strategies and approach the market similarly to the private sector, they would be able to support growth for the majority of TMCs rather than the minority. Most importantly though, they would find a variety of solutions that meet a multitude of needs and hopefully result in the last of the framework negotiations for a long time to come.
THE SUPPLIER Luke Goggin, Head of Sales, Whitbread Hotels & Restaurants At Whitbread Hotels & Restaurants we are seeing UK businesses starting to report steady growth post-recession, while at the same time the public sector is entering its period of economic austerity as something close to £81billion is being cut from public spending. So how can the public sector learn from private business how best to cope, and how far can it realistically focus on cutting travel costs while still being able to focus on its core purpose? Clearly the private sector has already been
room rate offered by a hotel is a big part of the total cost but by no means all of it. There are always additional costs such as breakfast, a two- course meal, a glass of wine, wifi, parking etc. There are lots of great headline room rates in the market but don't forget to consider all the extras. We also see our high volume private sector customers increasingly focusing on the ‘end to end’ booking costs. This includes booking and transaction fees and additional distribution costs, as well as any bill back or credit facility fees. We have worked hard with our customers and their chosen TMCs/HBAs to put in place the most efficient booking and payment processes available and as such we have seen these additional costs reduce by up
to 60 per cent for some customers. I was at a public sector event recently and this area of additional cost and how to reduce it came up several times, so it is already front of mind. Thirdly, there are a lot of suppliers in the marketplace and many different ways of doing business, but our success in the private sector tells us that as a supplier, we are at our best when we are working with our customers to shape and innovate our products and services. Over the last 12 months we have modified existing technology to build bespoke booking solutions for more than 20 of our private sector customers. These bespoke tools and processes were only developed because we had great dialogue with our customers. The developments have led to improved efficiencies and reduced operating costs, none of which could have been achieved if we had been kept at arms length and taken through a standard buying or RFP process. We have been able to break this mould and deliver genuine tangible benefits through partnerships with our customers and I am sure that such relationships can work for both the public and private sectors.
At the start of his career, Chris worked in a number of high profi le operations roles with both American Express and The Travel Company across multiple business sectors. He then joined Citigroup and rose to the role of senior vice president, global lead for travel services, winning numerous internal awards for services delivered. He launched Severnside Consulting in 2010 to provide his business travel expertise to multiple organisations.
CHRIS THELEN CHIEF EXECUTIVE OFFICER, CHAMBERS TRAVEL MANAGEMENT
Chris Thelen is the CEO and owner of Chambers Travel, a multi award-winning corporate travel management company. Chris joined Chambers as commercial director in 1999, having previously held a number of senior roles in the corporate travel industry. His infl uence and entrepreneurial approach set a pattern of impressive growth for Chambers and fi ve years after joining the company, Chris led a successful management buyout to become majority shareholder.
LUKE GOGGIN HEAD OF SALES, WHITBREAD HOTELS & RESTAURANTS
Luke is head of sales for Whitbread Hotels & Restaurants who own and operate the UK's largest hotel chain, Premier Inn, with more than 600 hotels across the UK. In addition to managing relationships with Premier Inn's key corporate and public sector customers, Luke and his team also manage and develop Premier Inn's no cost, market-leading direct connect distribution channel for HBAs and TMCs across Europe.
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