Payment terms:
getting it right A COMPANY HAD AN ANNUAL AIR TRAVEL SPEND OF £20 MILLION. It wanted to move its payments from invoicing to a credit card. In theory, this was to streamline the payment and administrative process. The decision was backed by the chief financial officer, who was attracted by a £75,000 annual rebate offered by the card provider. However, the company failed to calculate that its pattern and volume of spending would generate upwards of £200,000 in merchant fees. Also, many TMCs and clients
of sales at FCM Travel, says while big data has focused minds, the biggest challenge for corporates remains finding effective ways to deal with basic data first of all. “Big data will become very powerful as it matures; but using ordinary data with impact will be central to the evolving TMC- client relationship going forward,” he says.
CONTENT OR DISCONTENT? Another much debated industry issue of recent years is that of content. Whether it is air, accommodation or ground transporta- tion, there is an abundance of choice in an escalating number of channels. This creates issues for both corporates and TMCs. Companies need travellers to book
through approved channels, so they know where they are. Programme managers need compliance in order to maximise preferred supplier agreements. But travellers don’t like to be restricted by policies that are not fit for purpose. Warren Dix, Hillgate Travel’s director of sales and marketing, says: “If you cannot offer full GDS [global distribution system] and non-GDS at the same point of search, you are out of the game. It is fundamental and expected by today’s travellers.” Chambers’ Birkin agrees, saying tech- nology is key. “The TMC must have the
60 BBT MARCH/APRIL 2016
“If you cannot offer full GDS and non-GDS at the same point of search, you are out of the game”
technology to scrape and search availability. It needs to be available in the marketplace, and understand the pros and cons to help clients make informed decisions.” But a London-based travel manager
from a global professional services company, speaking to BBT, says TMCs are struggling to keep up with the new content, such as Airbnb accommodation and Uber taxis, entering the marketplace. He says: “The TMC used to rely on everything going through the GDS. As this source is fragmenting, they must adapt mid- and back-offices to handle different data sources. This threatens two of their revenue streams: the GDSs and supplier income. “In addition, new players are coming into the market who claim to handle all
are evaluating their current payment terms, as IATA’s BSP payments will soon have to be made fortnightly instead of monthly. There are pros and cons
to all payment methods and processes – but there is no one-size-fits-all solution, and corporates should not be lured by so-called ‘incentives’ without calculating total cost.
Source: global independent TMC
sources. We’ve yet to see if this is true, but their presentation of data and timeli- ness appear to put TMCs in the shade.” He warned that one day TMCs might only manage compliance and provide consultancy to organisations that choose to outsource. Clive Wratten, chief executive of CTI, admits that many of the best travel deals are found online. But he warns that employees can waste too much time browsing the internet. This is where he believes TMCs, using specialised industry booking tools, can find the best deal both on and offline. “Consumers and business travellers have more options than ever when planning a trip,” he says. “They expect offers to be tailored. For this, it’s important for any
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