“To get the best from an RFP, it is important to balance asking all the required questions, with ensuring that the bid document is a manageable length”
An electronic process also reduces the
cycle and makes it easy for suppliers, who know when to expect it and what format they are getting. And it is easy for them to circulate the eRFP within their organisa- tion. Clients can also log in and check what’s going on.
A QUESTION OF LOGIC Many companies do less negotiating for air because they are using lowest logical fare and discounts are increasingly hard to come by unless you have a huge spend. American Express GBT uses a template
for air and car rental, and is building an online tool for the former. “Hotels are quite saturated but air is seeing quite a lot of trac- tion,” says Parth Pamnani, senior manager at the TMC’s global consulting division. “That is where the majority of opportunities are because there is greater competition on the airline side, with increased capacity from Middle Eastern carriers, and falling oil prices. Some of our clients have between US$100 million and US$1 billion spend, so lowest logical doesn’t feature.” One buyer for an international advertis-
ing firm that BBT talked to uses a standard template for air, but she says because carri- ers often do not use booking classes in the
same way, it is difficult to do the process electronically because she can’t compare like-with-like. She tends to have a three- year legal agreement and then renegotiates fares annually. Consultant and managing director of
Inform Logistics, Ian Flint, feels TMCs are also best approached non-electronically. “Electronic RFPs work best for hotels, but when you get into the complex world of TMCs, which includes data management, reporting, online booking and so on, it is not as easy to define closely and, therefore, not very successful.” He sends a form to potential TMC sup-
pliers, which gives information such as the goals of the client company, where they are located, expenditure and transactions, “so that the TMC can assess and explain how they would service it”, he says. The information this elicits includes location of offices, and whether these are owned, franchised or affiliated; specialisation in corporate/leisure, and so on. Once he has narrowed down the most likely contend- ers, he invites them to present in person. But whether face-to-face or via webcam,
at the beginning of the process, a meeting of all potential bidders gives potential sup- pliers access to any information they need.
“Before we launch an RFP, we host a supplier meeting, conference call or webinar, where we outline what we are looking for. All sup- pliers will be invited – our philosophy is that everyone gets the same message before the eRFP goes out,” says AIG’s Jacobsen. “All parties tendering for that commod-
ity programme will get the answers to everybody’s questions, so there are no secrets – and suppliers can put their best foot forward when responding to the RFP.” Jacobsen also has direct discussions with providers at the negotiation stage. To get the best from an RFP, it is im-
portant to balance asking all the required questions with ensuring that the bid document is a manageable length. The process costs both suppliers and buyers time and money, so it is in the interests of all parties to have targeted questions to elicit concise and apposite responses. Similarly, it makes sense to cap the fields for answers, in order not to receive a veri- table novel of a reply, and to pre-populate fields with last year’s information, so that suppliers can easily update it, and then add questions predicated on travellers’ safety and security requirements. Safety questions feature large in RFPs,
and local contacts play a valuable role in assessing new hotels to ensure they comply with all requirements. This is also an important part of communica- tions with travellers, where education is paramount. A useful adjunct to all this is to assess
and re-assess your programme throughout the year, including feedback from travel- lers and suppliers, so that you already have good market knowledge and a clear idea of what you and your travellers need by the time the RFP comes around.
RFP BY COMMITTEE? To that end, it is worth working out who should be part of the process so that all areas are covered. The buyer, the TMC, suppliers and travellers are the starting point. “There is also someone from every country where
82 BBT January/February 2017
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