Travel management companies
“ Travel management companies provide the ultimate search engine,
plus management information and an emergency service. A TMC helps a company manage its whole travel programme
” ➔
Consulting with the best One product of TMCs’ ability to respond to an ever-changing environment is the creation of dedicated consultancy services. FCm launched FCm Consulting in August last year and in September Chambers Travel Group restructured into five divisions, including consultancy. “We are enhancing the consultancy service by providing a more compre- hensive travel programme evaluation tool,” says sales director Paul Broughton. “Traditionally, our consulting services
were taken by our existing travel management clients and we are seeking to say, you can come to our consulting division for impartial advice, even if we are not doing your travel management.” The company is also aiming to simplify its pricing tariff. But director of business travel for
Severnside Consulting, Chris Pouney, questions the authenticity of such services. “TMCs are trying to position themselves
as trusted partners and consultants,” he says. “But there are certain things they cannot do. How can they possibly be part of an RFP process when there is a link to the parent travel management company, which has a marketing or over-ride agreement with suppliers?” However, joint managing director of
Statesman Travel, Mervyn Williamson, points out that there is no other sector where an operating cost attached to selling a product or service is not covered by the supplier. “Marketing agreements are for airlines to
provide income to a TMC for distribution,” he says, and is adamant the interests of Statesman’s clients come first. “We have preferred carriers but we do not pay commission to staff and on that basis we are independent. When we put an airline programme in place for clients, if the service level agreement says best fare on the day, we don’t offer what suits us. We look for long-term
relationships.” Statesman’s consultancy services are included in its account management fees. ATPI also provides consult- ancy as part of the fee but, “I would be lying if I did not say that it is getting harder, as transaction fees are being driven lower,” says Adam Knights. Of TMCs’
consultancy divisions he says: “The corporate customer has to take some responsibility for that trend. They used to get everything
for a £20 fee and now they are getting it for less than £10.”
Valuable assets All this means that TMCs have to communicate clearly the value they bring. “The majority of companies with a substantial travel spend use a TMC,” says director of programme management and business development UK & Ireland for CWT, Nigel Turner. “They can go direct but if they do that,
they only buy what that the supplier wants to sell them. A TMC aggregates content that no one else does and gives a company’s bespoke rates, the TMC’s and market tariffs,” says Turner. “TMCs provide the ultimate search engine, plus management information and an emergency service. A TMC helps a company manage its whole travel programme and part of that is the application of policy and, sometimes, the forming of it. The majority of organisations do understand the value of a TMC.” Travel manager EMEA for Ford Motor
Company, Stephen Swift, says the company needs an agency to be a single point of contact for employees to make travel arrangements for two reasons. “We need to know where people are – when the world seems to be a dangerous place, having all our data in one place gives us peace of mind; and secondly, for consolidated purchasing from vendors, using all the data for our airline, hotel and car hire spend,” he explains. Swift used its TMC’s consultancy services
for airline deal analysis and hotel pro- gramme negotiation. “In the deal analysis, I feel we could have done it – it didn’t give me anything I didn’t already know. But using them to provide resources to negotiate a hotel programme has been excellent and benchmarking against other clients added clear value. “Our TMC’s wider client base has helped
me deliver an even more robust hotel programme – it informed our decision,” Swift concludes. Value demonstrated.
Specialist services Where once hotel programmes were best handled by hotel booking agencies (HBAs), now TMCs provide a robust service in house, responding to clients’ desire to have everything under one roof: Capita’s buying of BSI and Expotel in 2013 and Statesman’s acquisition of Hotelzon last year reflect that. TMCs are also offering specialist services in areas such as oil and gas, marine, finance and law. Specialist knowledge includes dedicated fares (marine), processing large amounts of hotel billbacks (marine, oil and gas); complex security requirements, attendant on the need to carry ammunition (marine, oil and gas); the ability to link the TMC’s finance system to the client’s to allow
➔ THE BUSINESS TRAVEL MAGAZINE 35
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