Business Travel Now

NOW managing your travel spend better

June 2009

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West talks about new procurement processes at Woolworths

SAFETY & SECURITY – your travellers come first!

■ How to curb total travel costs ■ Corporates ask for value-added car hire ■ Stop! Travel buyers can help reduce churning ■ Middle East takes off as new global hub

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CONTENTS

Waste not, want not

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XTRAVAGANCE leads to poverty, or so the saying goes, and this has relevance in more than one application, including the travel industry.

Wastage of any kind is generally frowned upon yet most people are unaware of what – and the extent thereof – they waste.

Take for example the concept of churning, in other words unnecessary wastage in GDSs, which is a significant problem in this country according to statistics presented by the Association of South African Travel Agents (Asata). How many corporate travel buyers are aware of how they are contributing to the industry problem – and to what extent?

According to Sure Travel corporate manager, Jim Weighell, the issue is behavioural because different companies contribute on a variable line based on their speed of process from request through authorisation to ticketing. And as such, because the problem is not purely technical, it will be more challenging to address.

Other contributing factors – as our Power Panel will reveal – include corporates shopping around via multiple channels and insisting that if a quote is given that a seat be held.

Industry bodies are already at work to find potential ways of alleviating this preventable expense that in one form or another may ultimately start chipping away at companies’ travel budgets, as suppliers pass down these not-so-hidden costs.

The car-rental sector is not immune from increasing GDS costs and suppliers have appealed to corporates – as part of the drive (no pun intended) towards longer-term partnerships – to assist by providing longer lead times and making cancellations timeously, which helps with fleet management, improved service levels and ultimately leads to a reduction in churning.

Building sustainable partnerships of mutual benefit is certainly a common theme in this issue, as is the idea of enhancing procurement processes during these tough times.

We speak to Belinda West, Woolworths central procurement manager for travel services, to hear about how South Africa’s popular retail giant has contained travel costs and streamlined purchasing processes this year. West is certainly a shining example of how a passionate approach to work goes a long way towards making smarter choices.

Other features that may hold some interest are our How To section – this month our report pertains to curbing total travel costs, which factors in employee time and the subsequent return on investment when travellers perform at optimum levels upon arriving at their destinations.

As Weighell so succinctly puts it: the warm, fuzzy trips that may or may not be successful are definitely a thing of the past.

As with many things, it would seem.

Good luck with those smarter, less wasteful, travel decisions. ■ KIM COCHRANE

COVER STORY Belinda West tells us about how Woolworths has made significant changes to its procurement process for travel services this year. Cover image by Tijana Huysamen, taken on location at the Woolworths store, V&A Waterfront.

News

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Swine flu and other pandemics – how safe are your travellers?

How To

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How to curb total travel costs

Africa Alert

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Vicqui Welton reflects back on her travels in Africa

Profile

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The Woolworths difference

News

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A380’s may get SA wings

On the Radar

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Corporates ask for value-added car hire

Mythbuster

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Is it cheaper to use your credit card overseas than exchanging currency before you leave?

Power Panel

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Our panel debates the issue of churning

Deal Detective

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Mozambique or Greece? The latest specials from Travelinfo

On the Radar

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Oil and gas – and managing the unique travel needs of this sector

On the Radar

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Middle Eastern Airlines take flight Brought to you by Now Media, Business Travel Now is a professional travel publication aimed at South African travel procurement decisionmakers in travel-buying companies. This publication aims to reflect an unbiased perspective of the corporate travel industry offering insight and tools encouraging readers to manage their travel spend better.

Destinations

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The Gulf – the latest developments

PUBLISHER David Marsh MANAGING EDITOR Natalia Thomson CONSULTING EDITOR Kim Cochrane CONTRIBUTORS Linda van der Pol, Max Marx, Hilka Birns, Jeanette Phillips, Liesl Venter, Natasha Tippel, Sue Lewitton DESIGN & LAYOUT Michael Rorke ADVERTISING SALES MANAGER Kate Nathan SALES REPRESENTATIVE Diana Comninos, Lisa Jacobs ADVERTISING CO-ORDINATOR Neo Matonkonyane SUBSCRIPTIONS subs@nowmedia.co.za ANNUAL SUBSCRIPTION RSA full price R275.00, RSA annual debit order R220.00, Foreign on application PRINTED BY Juka Printing (Pty) Ltd PUBLISHED BY Lugan Investments (Pty) Ltd trading as Now Media Now Media Centre, 32 Fricker Rd, Illovo Boulevard, Illovo, Johannesburg, PO Box 55251, Northlands, 2116, South Africa.

Tel: +27 11 327 4062, Fax: +27 11 327 4094, e-mail: btn@nowmedia.co.za, web: www.btnow.co.za

June 2009 • BUSINESS TRAVEL NOW

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NEWS

Your travellers come first The recent diagnosis of swine flu in Mexico has yet again served to remind corporations of the importance of speedy interventions with respect to the health, safety and security of their travellers.

Liesl Venter finds out more about how from a position of social responsibility, and to ensure business continuity, it’s prudent to have measures in place to support employees when emergency situations arise.

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“With the current state of world affairs, traveller safety can take many forms.

Whether it be swine flu in Mexico, a bushfire in Australia or a US Airways crash on the Hudson River, the importance of being able to inform and track travellers at all times to ensure maximum safety is no longer a nice to have, but a must have”- Anita Parent Parent says it’s imperative that businesses be able to track travellers at every stage of the journey, while keeping them informed and updated on global events that pose possible challenges.

“Technology has been the answer. Developing unique applications that can actually harvest and interpret travel data from all over the world has enabled Wings to keep continual track of all the travellers on its system as well as being able to constantly and instantly keep those travellers informed of any changes in their plans or the safety levels of their destinations,” says Parent.

Update your pandemic preparedness plan INTERNATIONAL SOS, a recognised expert in disease outbreaks and pandemic preparedness, has launched a new website to communicate important information regarding the swine flu outbreaks – www.internationalsos.com/pandemicpreparedness.

The site contains the latest news, frequently asked questions, travel recommendations and country updates, public health as well as epidemiological and antiviral information.

In response to the outbreaks, International SOS formed a crisis management team to evaluate the situation and assist clients in affected areas. Clients have been urged to review their pandemic preparedness plans in case the outbreak spreads.

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International SOS

XPERTS agree South African companies have for far too long been complacent and unconcerned about business travellers’ health, safety and security.

Jared Higgins, md of Arcfyre, a specialist security company based in Johannesburg, says it’s imperative that companies have travel policies that are followed at all times.

“We are far too complacent about safety, especially when travelling in Africa. Part of our culture is that we believe because we live in SA, we’re immune to the continent’s inherent dangers. And yes, we may have a better understanding of how the continent works, but we’re not impervious to a vehicle accident or a kidnapping.”

With the current state of world affairs, traveller safety can take many forms. Whether it be swine flu in Mexico, a bushfire in Australia or a US Airways crash on the Hudson River, the importance of being able to inform and track travellers at all times to ensure maximum safety is no longer a nice to have, but a must have, says Anita Parent, Wings Corporate Travel global head of department, Products & Solutions.

“We’ve found that this has become a huge issue for travel management companies and it is being tackled head on so as to provide safer, more secure business travel solutions.”

Experts agree that traveller safety is best dealt with by forging strong partnerships with specialist security companies. These companies are experts in dealing with emergency situations, but they also provide pre-trip security information and offer protection if required while corporates are travelling.

Here a patient is prepared for medical evacuation via air ambulance.

According to Higgins, many business travellers travel without taking any of these possibilities into account. “Planning the safety aspect of any trip is of the utmost importance,” he adds, and companies should partner with a professional security supplier.

“Firstly, a travel plan should incorporate a communication policy – as a traveller in a foreign country, you should speak to your office in SA at least once a day, updating them on your movements and plans. This communication policy should be amended according to the country threat level. If you don’t make contact, your office can immediately start implementing the next steps to ensure you are safe.”

He says for the most part, Africa is more dangerous and unpredictable than Europe or the US, but one should not risk employee safety on chance.

Higgins advises companies to research the country being visited ahead of a trip – and also to use the most reputable local service providers, which in its own right is a challenge.

“Pre-vetted vendors should be sourced – in other words, pre-approve the local company you are working with, whether it be a translating service, transport company or hotel. Always know who/ what you are dealing with at all times.”

He also advises travellers to register with the embassy or high commission upon their arrival in a foreign country, something that is not often done. This gives the embassy a base from which to work when locating travellers in the event of civil unrest or a natural disaster.

Parent says this is all about communication and ensuring everyone (employer and traveller) is informed.

“Should an emergency arise, companies can be informed as to the position and wellbeing of their travellers, while travellers can be alerted to important changes that may affect their plans or safety.”

NEWS

Many travellers feel their employees don’t have the necessary measures in place to ensure their safety, or to be able to assist them when needed, says Acte’s Monique Swart

Says Warren Tanner-Ellis, MTN group travel manager: “We have a nominated security/business risk officer in all 21 African and Middle East countries in which we are based and provide security protocol for all travelling MTN’ers in most MTN countries.”

The company also contracts a global medical advisory service, which, says Higgins, is vital when travelling in Africa.

“Medical services in Africa are not the same as what many travellers are used to in SA. One of the biggest risks a traveller faces is a vehicle accident. It is the company’s responsibility to know what to do and to provide travellers with the right medical attention and quickly.”

According to Monique Swart, regional director for Acte Middle East and Africa, many travellers are expressing the general feeling that the world is more dangerous. They also feel employers don’t have the necessary measures in place to ensure their safety or to be able to assist them when needed.

Kidnapping is on the rise globally, which also places travellers at risk, says David Butler of Control Risks, one of the world’s leading global business risk consultancies. “It is a means of making money easily and we’re seeing it increase, especially in certain areas in Africa.”

He says it’s important for travellers to assess situations, but also to be able to deal with a situation.

“Don’t think you have it all under control,” says Higgins. “You never know what could happen.” ■

Safety tips Michael Schmidt, a veteran conflict journalist and training director of frayintermedia, gives the following tips for travellers heading for foreign countries: • Plan trips properly with your line manager and other departments involved so they have a good idea of where you are at all times.

• Plan an exit strategy, including how to leave the country rapidly and what Plan B is, including lines of retreat at any given point.

• Arrange a good fixer, driver and translator on the recommendation of reputable organisations within the country you are visiting.

• Double check the accuracy of your translator’s work with third parties to ensure you’re not being misled.

• Arrange to carry a spare passport, which you can afford to lose or have taken off you.

• Ensure you have the relevant equipment pertaining to your conditions.

• Get to know the area you are

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• • •

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moving in very well; orient yourself with detailed maps.

Read widely on the background of the society you are working within.

Be respectful and calm. Pay attention to your dress, language and attitude.

Do not break social and legal taboos.

Do not brag about your work, as this will draw unwarranted attention to you and never misrepresent yourself.

Keep a low profile.

Try to avoid travelling at night or towards evening and never pick up hitchhikers.

Stop at all roadblocks.

Continually reassess the risks you face and communicate any change of routine, route or plan to your line manager.

Always trust your gut instincts and don’t push yourself beyond your own instinctual safety margin.

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HOW TO

How to curb total travel costs

TIJANA HUYSAMEN

With the drive to cut back costs, never before has defining the total expenditure on travel been more important. By Liesl Venter.

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“Companies when deciding on where to spend their travel budgets are becoming more apt at assessing what business trips will see a return on investment. The warm, fuzzy trips that may or may not be successful are definitely a thing of the past.” – Jim Weighell

N the face of economic uncertainty, curbing costs is critical not just to ensure competitiveness, but for business survival.

As travel is one of the largest controllable expenses within most companies, it goes to reason that significant cutbacks and scrutiny can be expected.

But when is cheap, cheap? Never, says Jo Schütten of Cape Town-based Unitravel.

“There’s no doubt that the biggest cost factor when it comes to top-level executives travelling is not the air ticket or the hotel, but rather the traveller himself. And taking this into account is extremely important when determining the cost of a trip.”

In a poll conducted by American T&E Research in August last year ahead of the financial crisis, it already showed that 45% of American travel managers said their companies had reduced travel volume.

Travel impacts on the bottom line, but is freezing travel or reducing volumes optimum?

No, says Michael MacNair, owner of American MacNair Travel Management.

“There’s a good reason why travel is such a huge cost to begin with: It’s an investment that ultimately generates revenue for an organisation.

Companies should not be closing the door on potential revenue, but rather strike a balance between traveller objectives and desires as well as the company’s needs and budget.”

Schütten agrees and says when flying senior executives overseas, it may be more economical to fly them direct as opposed to opting for cheaper stopover flights.

“Companies need to take various factors into consideration when determining the trip cost, including the price of the executive

and the return on investment when he is performing at optimum level on arrival and signing a multi-million rand deal.”

According to Jim Weighell of Sure Travel, there is possibly no straight answer to determining how one defines the cost of a trip.

“It depends on the culture of the company and where it places value – is it the commodity or the people? It is probably about finding balance. What cannot be argued is that cost containment is a priority right now.”

Time for smart, not cheap, choices Economic pressure is severely impacting travel budgets, but ridding the process of all the extras and concentrating on the simple things will make a major difference.

“Ensure tickets are of such a nature that if travellers finish early, tickets can be changed to allow for a flight home rather than having them sit in a hotel because the cheaper flight does not allow for changes. It’s about smart choices rather than cheap choices,” says Schütten.

MacNair says there are ways that companies can ensure their travel money is spent wisely.

This includes establishing a ‘travel squad’, a small core group of necessary staff who represent the entire company, from executive to operational level, who can act effectively and quickly as well as review policy.

Schütten says often these costs may result in more hard cash being paid out, but the ultimate return on investment and the dynamic determination of the trip cost is much less.

“It’s about getting your travellers to their destinations quickly, effectively and rested.

Sometimes direct flights, a fast rental car or a better hotel is the more financially viable option”.

Be productive

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Experts agree it’s about taking a smart approach to travel and not just cutting the most obvious costs.

Speaking in Spain earlier this year at the launch of a report into how the economic downturn was affecting corporate cutbacks, Antoine Medawar, md of Amadeus Hospitality Business Group, said economic pressure meant that most executives wanted to make business trips as productive as possible.

“Forget gyms and restaurants.

Instead concentrate on efficient check-in/out and internet access.

Good WiFi connectivity is now rated above any other extra.

“There is a flight to trusted brands and the expectation of a common level of good service no matter where you are in the world.” ■

Africa Alert

Looking for some guidance and tips before sending your travellers to African countries? Vicqui Welton of Fulela Trade and Invest 80 offers some insights...

By Denise Slabbert

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ITTING recently at Jomo Kenyatta International Airport in Nairobi, waiting for a flight back to Johannesburg, I had some time to reflect on my last few years of extensive travels in and around Africa. I felt it opportune to highlight some of the amazing developments I’ve seen within a relatively short period. I think all too often we’re caught up in the negative and stress of our jobs that we forget to take the time to acknowledge the tremendous changes happening literally right before our eyes.

It’s incredible how things have improved in a country such as Nigeria.

This morning (at the time I wrote this piece) I was at the Nigerian Embassy getting a visa and the efficiency of the process impressed me – 15 minutes filling in the form and paying online, Vicqui Welton five minutes in the queue at the Embassy to hand in the documents and a visa to be issued within two days.

Those of you who travel frequently to Lagos would have noticed the number of hotels having just opened or about to. The development of the tourism infrastructure, with new hotels and guest houses, is a good thing from a business travel point of view, as buyers and travellers have more choice and hopefully, over time, a better chance of securing reasonable hotel rates.

Ghana has also seen a lot of development in the last few years. Shopping centres have opened and there is now a good selection of hotels of various standards.

Angola is another example – many international airlines are in the process of finalising or have finalised plans to fly in and out. For a country that a few years ago only had a handful of international airlines (with the subsequent pressure to get seats), there will be much more choice and seats available.

East Africa is also focused on the travel industry. Of course Tanzania and Kenya in particular have always had well-developed tourism infrastructures, but countries such as Uganda and Rwanda have seen massive changes in terms of road development as well as the upgrading and opening of new hotels. I believe the arrivals and passport formalities at Entebbe International Airport are amongst the best in the world from a speed and efficiency perspective. Of course, on the other side of the coin, obtaining a visa on arrival in Dar es Salaam remains an issue!

For me, travel in Africa is still challenging yet the changes and improvements are positive and bode well for the future of business in these areas. ■

Hilka Birns

Tijana Huysamen

BTN winners congratulated

Dawn Stewart, manager of Carlson Wagonlit Travel’s Cape Town branch, congratulates BTN’s February winner, Bradley Cooper, travel manager for the Clicks Group, at his home in Grassy Park, Cape Town. Cooper won two nights’ accommodation and breakfast for two people sharing at any Southern Sun hotel or resort countrywide and three days’ car hire in a luxury Group F vehicle from Budget Car Rental.

Uniglobe Travel Sub-Saharan Africa’s Nikki Gray (right), marketing and events coordinator, hands over the prize for winning the competition in BTN March’s issue to Carey Langman, PA to the md at Bentel Associates International. Langman wins free entry to Uniglobe’s next Travel Coordinators Workshop.

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PROFILE

The Woolworths difference Photographs: Tijana Huysamen

BTN meets up with Woolworths central procurement manager for travel services, Belinda West, during a recent trip to Cape Town and learns how this popular retail giant has put as much care into procurement processes as it has with everything else it does. Words by Kim Cochrane

Savouring the beauty of a much-loved Cape Town at the V&A Waterfront harbour.

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OOLWORTHS central procurement manager for travel services, Belinda West, is – according to her own admission – a workaholic and as such, she is passionate about her portfolio and, like most South Africans, about the Woolworths brand.

Speaking animatedly with BTN at the V&A Waterfront in Cape Town and comfortable in an outfit (yes, from Woolworths) that she says describes her best – black sleeveless ruffle blouse, denim culottes and thong sandals – she tells us more about how Woolworths has made significant changes to its procurement process for travel services this year, with a focus on enhancing efficiencies and containing costs.

These changes have resulted in the introduction of benchmarked airfares locally and the employment of a procurement controller – Nicole Keane – who reviews all travel arrangements as well as the pre-authorisation of travel plans before travel quotations are accepted from the onsite in-house travel management company, Travel with Flair.

“This ensures the most cost-effective travel solutions available can be secured. Benchmarks and preferred supplier schedules provide the control mechanism. The process flow also sees orders checked for compliance to policy and the

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cost effectiveness of plans proposed before orders are finally confirmed. We strongly apply travel expenditure limits and have also extended our utilisation of low-cost carriers on domestic routes and delivered greater visibility of spend through improved reporting. The procurement team’s role has been to focus on cost efficacy, while demand management is left to the business units.”

These interventions, she advises, have enabled Woolworths to consolidate its travel procurement through one TMC while retaining the procurement gains achieved by using two TMCs over the past few years.

“Since we completed implementation of our new procurement model, the focus for the rest of the year will be on measuring benefits and quantifying the results of our new buying processes. We’ve achieved an incremental saving year-on-year over February, March and April, the months reported on thus far (at the time of writing). Woolworths has a mature travel management process and therefore we benchmark against averages achieved over the same period year-on-year as opposed to full economy airfares or rack rates.”

West adds: “Our next priorities will be to review automation of travel authorisation, consider the role self-booking tools should play

in our procurement and evaluate credit cards as an effective payment mechanism. We currently use lodged cards for air travel expenses and our evaluation will be focused on managing expenses incurred whilst travellers are away from home.

Presently we reimburse for local subsistence and expenses upon return, while providing foreign exchange advances that require post-trip reconciliation for international travel.”

“At 20 years, I’d never been on a plane and the travel industry seemed an interesting and exciting opportunity.”

Interestingly, West landed up in the travel industry by default. “I started out as a receptionist at a travel agency. At 20 years, I’d never been on a plane and the travel industry seemed an interesting and exciting opportunity. I moved into a consulting position as soon as I could and studied

PROFILE

Benchmarks and preferred supplier schedules provide the control mechanism

Focus for the rest of 2009 will be to measure the benefits of the new buying processes, says West.

– has to contain costs, particularly when many changes are made to travel plans. “Our employees travel to variable international destinations based on business requirements so agreeing route-based airfares or negotiating destination-specific hotel rates can be challenging. In addition, when travelling abroad, employees need rooms that are large enough to manage all the additional luggage collected along the way in the form of samples.

Generally, we only hire vehicles locally, so this issue has no impact on our dealings with Avis. In terms of airfares, supplier flexibility is a concern, but our answer to this has been to implement the procurement controller concept to manage per- and pre-trip expenses more closely.”

West concludes: “It’s a pleasure to work for a company that has such a strong social and environmental conscience. We’re already down the line with carbon reporting among other considerations. Some of my focuses going forward will be on improving and quantifying procurement from a sustainability point of view.” ■

through correspondence for a formal travel qualification. After five years, I headed to London on a two-year working holiday visa and worked in corporate travel there. I returned home in 2000 and joined Seekers Travel in Cape Town as leisure business unit manager. With a desire to change direction, I completed a BCom through UNISA and later a project management diploma at the University of Cape Town (UCT). In 2002, I joined South African Travel Centre. In true travel industry style, I was a jack of all trades there, responsible for quality management, corporate product development, franchisee relationship management and marketing for the secondary brands. I joined Woolworths in July 2006 as a travel services manager. I was then privileged to be offered an opportunity to complete a business postgraduate programme sponsored by Woolworths at UCT’s Graduate School of Business. I graduated in June 2008 with a few more grey hairs and a niggling caffeine addiction.”

“I think the future focus for travel managers will be on achieving greater integration of procurement channels and expense management.”

When West joined Woolworths as travel services manager, hers was a financially oriented role that was new to the company. “In the beginning, I focused on improving processes and expense transparency while maximising procurement rebates. Annual contracting of suppliers was a relatively small part of my job.

Now my role is in procurement and therefore it entails sourcing policy, process design, cost containment and securing enhanced visibility of spend. I’ve learnt a huge amount since joining Woolworths, but this has been more about finance and the retail industry rather than travel procurement. I’m fortunate to find myself in the procurement space with retail travel experience and, therefore, have an intimate knowledge of how it all hangs together.”

Tips for enhancing procurement processes

A procurement professional’s dilemma – spoilt for choice at the beauty counter.

Woolworths store, V&A Waterfront.

She believes general challenges facing travel procurement professionals these days are around leveraging and integrating technology.

“Questions I’d like to see mooted going forward are around how corporates are dealing with content fragmentation and internet offers that undercut negotiated rates. Another topical issue is establishing the true cost saving offered by self-booking tools, which can only be determined if the cost of employee time spent negotiating such tools can be quantified. I think the future focus for travel managers will be on achieving greater integration of procurement channels and expense management.”

In terms of internal challenges, she says the organisation – as with many corporations

• Give consideration to the complete process flow, from end to end.

• Pay attention to all customer touch points.

• Remove any potential blockages or bottlenecks that delay flow and thereby inhibit the ability to secure discounts.

• Incorporate self-regulation into the system by providing authorised expense schedules.

• Establish feedback channels to report on unnecessary expense incurred as well as savings achieved.

• Provide comparative reporting to encourage business units to improve their contribution.

Key suppliers • • • •

TMC – Travel with Flair Car rental – Avis Airlines – both low-cost and legacy carriers Hotels – the most appropriate establishments based on destination requirements are selected as opposed to contracting with hotel chains

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NEWS

A380s may get SA wings So confident are Air France KLM in the Johannesburg route that plans are under way to introduce the A380 aircraft on Air France flights to the city.

In addition to introducing the A380 on the route, newly appointed Air France KLM manager Southern Africa Max Smit says KLM will follow Air France’s example by introducing a premium economy product.

Both Air France and KLM’s premium economy will be phased in across the fleet and eventually used on the Johannesburg and Cape Town routes.

A380 for EK JNB services a ‘strong possibility’

Although Emirates Airline has no immediate plans to introduce the A380 on the Johannesburg route, there’s a “strong possibility” it will, provided the airport is ready.

This is according to Nigel Page, recently appointed senior vp for Emirates’ Africa region, who added that the A380 would provide an additional six firstclass, 30 business-class and 92 economy-class seats compared with the current aircraft on the route.

Expanding on its African routes, Emirates recently announced the launch of three weekly flights to Luanda in August, as well as confirmed the launch of its Durban route in October. The Durban flight will be daily and operated by an A330-200.

Emirates is operating the A380 on its New York and London routes.

Connex signs with BCD CONNEX Travel has signed a deal with BCD Travel in South Africa that will make it the exclusive representative for the global TMC. In a supplier statement, md Kananelo Makheta said there were considerable synergies between the two organisations, “one of the most significant being our mutual focus on simplifying and streamlining of the corporate travel process”.

Arik Air launches Lagos flights in June Arik Air will launch its second long-haul route launch from Lagos to Johannesburg on June 1.

Flights will depart Lagos Murtala Muhammed International Airport at 21h35 local time, arriving at Johannesburg’s OR Tambo International Airport at 04h50 the following morning. The return flight will depart Johannesburg every afternoon at 13h45, arriving in Lagos at 19h00.

Operated on a newly acquired Airbus A340500 aircraft, the two-class service will include 36 seats in Premier Business Class and 201 seats in economy class.

Guests in Premier Business Class will enjoy leather upholstered seats that convert into fully flat 190cm beds. The cabin is configured in a 1-2-1 layout, with individual privacy screens to separate each seat.

All seats are equipped with personal audio- and video-on-demand entertainment system and a wide 43cm personal TV screen. Premier-class guests will also have their own in-flight bar and lounge area in which to relax.

The economy cabin has a 2-4-2 configuration with individual TV and entertainment systems.

Says Suraj Sundaram, gm sales and marketing: “We also expect the convenient schedule to prove popular with our future customers in South Africa.

In addition, the timings of the flights will make it easier for customers to connect to and from several domestic points within each country, especially within Nigeria, since Arik Air already offers an extensive domestic network covering 19 airports.”

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BCD Travel at a glance

• It is the third largest global travel management company • It is operational in more than 90 countries on six continents • The annual sales turnover for the company is US$14 billion • The company employs more than 13 000 travel professionals worldwide

Lonrho to build Angolan domestic network Lonhro’s regional African airline, Fly540, has been granted a licence to operate in Angola.

The airline hopes within a few weeks to be granted its Air Operators Certificate (AOC) after which it will launch two-class commercial passenger services to Cabinda, Luanda (pictured right), Soyo, Benguela, Huambo and Malanje using new ATR72 aircraft.

Fly540 is building the first international standard pan-African airline and plans to fly in 15 countries by the end of 2010 with operating hubs in East, West and South West Africa.

Says David Lenigas, executive chairman: “Fly540 will provide a much-needed scheduled airline service for Angola and as rapidly as possible develop a network to service all the major population centres in the country.”

Afriqiyah extends Tripoli service Tripoli-based Afriqiyah Airways has extended its planned twice-weekly Tripoli-Johannesburg service to Cape Town. The Friday and Monday flights, set to start on September 11, will depart Tripoli at 19h30, arriving in Johannesburg

at 06h00 and departing for Cape Town at 07h50. The return service will depart Cape Town at 18h00, arriving in Johannesburg at 19h50. The flight will depart Johannesburg at 21h20, arriving in Tripoli at 06h10 next day. ■

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ON THE RADAR

Corporates ask for value-added car hire In a fiercely traded industry with such a wide range of big brands available to travel buyers, and with buyers actively trying to manage costs, the relationship between corporates and rental suppliers is becoming increasingly important. Natasha Tippel reports.

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ORPORATES are confronted with a myriad choices in the car-rental industry when choosing suppliers, all of whom employ tactics to gain the competitive edge. But gone are the days when cheap prices were enough to win the upper hand; rather, these days, clients expect more and suppliers who wish to stay on top of their game need to listen to their customers’ demands, providing better, more personalised services and facilities.

Ceo of Europcar in SA (previously Imperial Car Rental), Dawn Nathan-Jones, notes that corporate travel volumes are levelling off. “Rental periods are shorter and many companies have implemented new travel policies. Where possible, companies are opting to conduct business via teleconference, as opposed to incurring costs for cross-country travelling.”

Although car-rental rates have remained relatively stagnant over the past two years, industry experts affirm that travellers can expect rate increases in the coming year, with vehicle costs predicted to increase up to 25%, resulting in price increases.

“Fortunately for customers, rate increases won’t occur at the same pace as rises in vehicle costs,” says Nathan-Jones.

“We realise the sensitivity in the current economic climate and intend to work with customers to contain these increases through detailed management of their accounts and acting on cost drivers such as length of rental, category, renters, damage and risk.”

Sales and marketing director of Tempest Car Hire, Janita Edwards, adds that corporates are reviewing budgets and moving towards more cost-effective suppliers who offer a premium service but at more affordable rates. “We’ve seen a shift from luxury rentals to more economical vehicles, the group B category being the most popular, which sustains and reinforces our strategy of de-fleeting our luxury cars.”

More than a good price Tourvest Travel Services chief sales officer, Claude Vankeirsbilck, believes car-rental companies need to foster stronger relationships with TMCs and corporates because in today’s market, price alone does not ensure loyalty.

“Choosing a car-rental company is not just about price, but about the value the product brings to the business travel environment.

Many car-rental companies compete only on price, therefore commoditising their product in a highly service-driven industry. Suppliers that meet other specific requirements too, such as availability, presence, reliability and value-adds, are continuously looking to add value, which makes our jobs easier when proposing their services to our customers.”

Anglo American head of shared business services, Werner Grundling, states that although cheaper pricing is favourable, the agreement must be viable for both parties.

Nathan-Jones agrees: “Corporates looking for the best option in terms of service and price should consider longer-term agreements.

Partnering with a professional company allows access to the experience and data that facilitates cost management to benefit both parties.”

Vankeirsbilck adds: "Car-rental companies should provide adequate reporting and management information. Lack of afterhours support and locations that are not sufficiently staffed also create frustrating service issues.”

Safety another key factor Grundling states that in the corporate travel industry, one of the key factors is safety.

“A supplier should be able to provide the European N-CAP rating of all their vehicles on fleet. This includes airbags, ABS braking systems and crumple zones.”

Nathan-Jones states that while companies are trading down in vehicle groups to reduce costs, many stipulate safety as a non-negotiable, where vehicles feature must include ABS and airbags. “We have seen an increase in demand for our group B vehicles, which are more economical but don’t compromise safety.”

“Corporate customers should look to their rental company to supply them with management reports.

These reports show where there is ‘abuse’, for example, renting a higher class of vehicle than perhaps the travel policy allows. It will also reveal which corporates are driving more kilometers than the business trip requires.” - Budget Car and Van Rental md, Ray Booth 10 JUNE 2009 • BUSINESS TRAVEL NOW

“Consistency is important.

There seems to be a differentiation in what is required and received at different rental locations and between different shifts at the same location.

Perhaps if an ISO system was implemented for front office staff this might be eliminated. What car-rental companies should also look at is providing carbon emission reports for clients.”

- Werner Grundling

“Corporate travel managers can ensure availability of vehicles by booking in advance. Generally, a week in advance will guarantee a vehicle, even in peak periods.”

- Dawn Nathan-Jones

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ON THE RADAR

As cars are often the last item booked for a trip, car-rental suppliers have appealed to corporates to please give longer lead times and to make cancellations timeously, which helps with fleet management, improved service levels and a reduction in churning.

The technological edge THE role of technology in the procurement of rental vehicles is becoming increasingly important and car-hire companies are looking more to advanced tools that allow for fast, efficient and accurate booking as well as cost management to gain the competitive edge.

Ceo of Tempest Car Hire, Leslie Matthews, says: “There’s been a noticeable trend for corporates to book via the internet. As a result, car-rental companies are improving this booking channel, as it offers an alternative to GDSs at a fraction of the cost.”

Avis Rent A Car ce, Wayne Duvenage, says there is pressure on the travel industry to rely less on suppliers for a GDS revenue stream. “GDS costs significantly impact the distribution costs of the car-rental industry.

The main impact is in the corporate segment where customers prefer to reserve their vehicles via a travel agent who offers them a one-stop travel solution that includes flight and accommodation arrangements, travel policy enforcement and the supply of information that can be integrated into their financial systems and management reports.”

Duvenage says that in the past six months with a weakening of the rand, car-rental companies have absorbed a 25% increase in GDS costs. In some cases (over 10% on average), GDS fees are paid for no revenue earned when customers don’t show or when changes to arrangements are made directly without using the GDS. These charges, he says, have not yet been levied back to customers.

That said, Avis Europe is to start imposing a £40 charge on customers who don’t cancel their rental booking or who don’t turn up within 24 hours of the arranged pick-up time. Avis SA will be watching the progress of this charge closely, with a view to introducing the same in SA, says Duvenage.

The decision has been made in line with the airline and hotel industries, which already pass on the cost of no-show travellers to customers.

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12 JUNE 2009 • BUSINESS TRAVEL NOW

How GDS costs are impacting the car-rental industry SOME reasons why GDS costs are having a significant impact on distribution costs, according to Val van den Bergh, gm of the car rental section of Savrala, are: • “GDS costs are reservation based and have no link to the length of rental or type of vehicle reserved. The average length of rental in the corporate segment is about three days along with the need for small entry level vehicles at the lowest cost. Around 40% of corporate business is for one-day rentals, where travellers travel less than 120km/day.

• GDS costs to the car-rental supplier are around R45 per reservation depending on the prevailing exchange rate. On a one-day rental, the GDS cost could amount to about 20% of the rental value (one-day business booked via GDS is not profitable for car-rental companies).

• Corporate travellers in general make a number of changes to their arrangements and this leads to cancellation and no-show problems, meaning that GDS fees are paid for no revenue earned. In this regard, the industry is engaging with the GDS companies to seek recourse and refunds, and will also engage with Asata and the travel industry for ways to address this.

• Most travel agents have not been motivated to move away from GDSs as they do provide real-time access to multiple products and suppliers in a single system, operating efficiencies and management information. They are also incentivised by the GDS companies on sector (reservation) targets.

• A solution that is being proposed by some suppliers is to offer customers two prices, namely a price via the GDS channel and another not."

ON THE RADAR

Car-rental companies are focusing on upgrading infrastructure at local airports in time for 2010.

New Europcar kiosk at ORTIA is cutting edge THE big name changeover from Imperial Car Rental to Europcar – official from end-May – became evident when the first Europcar branch was unveiled recently at ORTIA. Modelled on its global counterparts, the new kiosk features state-of-the-art facilities including WIFI connectivity and plasma screens.

Europcar’s ceo in SA, Dawn Nathan-Jones, says the company’s personalised service has become even more personal. “Customer relations officers are posted at our busiest branches welcoming and trafficking our customers to prevent any delays.”

She adds: “Now all 120 branches have received their facelifts with the exception of Cape Town and Durban International Airports, which await Acsa’s facilitation into new areas.”

Meanwhile, Imperial’s expedient ‘fly-through’ service for business people, Speedline, is now named Ready, in line with Europcar branches globally. The counter is conveniently placed alongside Europcar’s car park.

Nathan-Jones adds: “We also have customer recognition functionality that codes and stores our customer’s details on the system. This means a once-off check-in. A quick validation is all that stands between our customers and the car keys on any rentals thereafter.”

Europcar has also launched a new B2B web portal to assist corporates and travel partners in making bookings, managing reservations as well as receiving statements and invoices online. The company also added a one-ton bakkie to its fleet and will be making more fleet enhancements in the latter part of 2009.

Europcar has been in SA for 11 years already, but it always focused on inbound business, which was limiting to the brand’s growth.

Similarly, the Imperial brand focused on the domestic market. The brand merger in May 2007 consolidated and strengthened branches, created a fleet of 16 000 vehicles and significantly extended the scale and footprint of both brands.

What else is new?

• Budget Car Rental has launched a new weekend special called Wings ’n Wheels.

Travellers can now take advantage of cheaper car-rental rates over the weekend when flying with any airline. To qualify, customers need only produce their valid airline boarding pass. Weekend rates apply from Thursday 08h00 to Monday 20h00, with a minimum of two days’ and maximum of five days’ rental (must include a Saturday). Rates include 250km free per day, collision damage waiver (CDW) and theft loss waiver (TLW).

• Hertz Rent a Car has announced the opening of its new Paarden Eiland branch in the Cape. Meanwhile, the car-rental company’s branch in Illovo has relocated to Randburg. The head office has also been relocated from Illovo to Kempton Park.

• Tempest Car Hire’s flagship branch at ORTIA opened recently. The new premises are substantially bigger and accommodate more terminals, reducing queues and offering a speedy check-out facility. In addition, Tempest plans to upgrade its kiosks at all Acsa airports between now and 2010.

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JUNE 2009 • BUSINESS TRAVEL NOW

13

MYTHBUSTER

It’s cheaper to use your credit card overseas than exchanging currency before you leave

Ernst du plessis

By Natasha Tippel

Reality

E

XPERTS agree, this myth is without-adoubt false!

“It’s definitely cheaper to buy forex from your point of departure,” says Patrick Khouri, ops manager for Tower Bureau de Change.

“Paying with your credit card abroad is an expensive affair. Firstly you cannot guarantee the rate of exchange you’ve anticipated or expected to get for the conversion and, secondly, you are charged a lot of unnecessary bank fees both locally and internationally.”

Director of retail operations for Bidvest Bank, Craig Macfarlane, agrees: “Drawing cash overseas from a credit card is the most expensive way of accessing money. Over and above the exchange rate variances, there are foreign and local bank charges as well as cash advance fees levied by the local card issuer. In addition to these charges, interest on a cash advance can be as high as 20%.”

Sugendhree Reddy, Standard Bank director of transaction products, points out that travellers should look at the costs and benefits of using foreign exchange products rather than credit cards.

“There are costs associated with either option. But, with foreign exchange products you see most of these costs upfront.

Meanwhile, with card products, a currency 14 JUNE 2009 • BUSINESS TRAVEL NOW

conversion fee is charged every time you make a purchase or withdrawal in a foreign country.”

“Travellers should know that if they use their credit card or prepaid travel card to pay for hotel bookings, the hotel will hold the funds on the card.

In some instances hotels fail to cancel the holding once you have settled your account, which means you’re unable to use your card even if funds are available.”

Reddy warns that, in addition to these costs, it’s important to keep in mind that it’s easier to exceed your budget when using a credit card, as it’s more difficult to keep track of your spending, especially when paying in a foreign currency. In addition, transactions are

usually not settled immediately and may take a number of days to reflect on your account; this also increases your risk of exchange rate fluctuations.

Travellers should also be aware that if they use their credit card or prepaid travel card to pay for hotel bookings, the hotel will hold the funds on the card. In some instances hotels fail to cancel the holding once you’ve settled your account, which means you’re unable to use your card even though there should be funds available.

On the other hand, despite the heavy costs, there are benefits to using your credit card abroad.

Says Reddy: “Your credit card offers you the convenience of not having to go to the bank before your trip and you get the interest-free period on all purchases made at a point of sale device.”

Travellers should also consider the security aspect. “Prepaid travel cards like TravelWallet, travellers’ cheques and your credit card can all be stopped and replaced if lost or stolen.”

Reddy recommends customers carry a mixed purse of products when travelling – cash to pay for things such as taxi fares, a prepaid card or travellers’ cheques and a credit card as a back-up option. ■

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POWER PANEL

Churning out the churn The term ‘churning’ does not only refer to the process of making butter, or producing something in large quantities – i.e. churning it out. But if the words GDS costs and ‘churning’ within a travel industry context don’t mean much to you, perhaps they should, particularly as these hidden costs may soon start eating into your budget. By Kim Cochrane

Travel buyers and travellers shop around via multiple channels, generally requesting that more than one quote be given.

t

he issue of unneccessary wastage in global distribution systems (GDSs) – ‘churning’ – was highlighted in a recent forum hosted by the Institute of Travel Management Southern Africa (ITMSA) to help corporates understand more about the hidden end costs of booking travel.

The debate partially focused on questions of whether there’s a lack of discipline or understanding with respect to churning, but it seems the problem extends beyond GDS wastage per se.

Perspectives from Sure Travel’s Jim Weighell, Asata’s Robyn Christie and Savrala’s Val van den Bergh (see Van den Bergh’s comments on page 12) were put forward in an interactive discussion, some of which have been included in this Power Panel in addition to extra input from industry experts.

While churning in the travel industry is nothing new, what is happening essentially, explains Christie, is that the airlines – who have to reduce distribution costs – are complaining that the cost of GDS fees for unused sectors is reaching an unacceptable all-time high, particularly in SA. Quoting aggregated statistics incorporating

16 JUNE 2009 • BUSINESS TRAVEL NOW

a few airlines over one month, Christie says Germany has a churning average of about 9%, the UK 18%,while SA is sitting on 45%!

She adds that Asata was alerted to the growing problem when an airline wanted to issue an ADM (Agency Debit Memo) to a travel agency for churn, which as Asata pointed out, was against the IATA resolutions by which airlines are governed.

The extended negotiations between Comair and Amadeus are a recent example of airlines wanting to charge dollar-based sector fees back to end users. Luckily the two parties reached an agreement and as a consequence, Comair withdrew the $4 surcharge that it had imposed unilaterally on Amadeus users booking Comair seats earlier this year.

What does ‘churning’ mean?

A: “The airline definition is that churning occurs when a booking (PNR) is updated on a daily or other regular basis. For example, a travel arranger requests a flight at a particular fare that has a same-day or other ticketing deadline, but the traveller does not confirm

his request. To ‘hold’ the reservation at that fare, the travel consultant is obliged to ‘recycle’ the booking prior to the ticketing deadline. There are instances of this happening over 20 times for one reservation. The issue becomes exponentially higher when travellers ‘window-shop’ with different travel companies looking for the ‘best’ price. Thus the churning described above can be happening at multiple agencies simultaneously.” Jim Weighell A: “Churning is the practice of repeatedly cancelling and rebooking the same itinerary in the same or different classes of service across one or more PNRs. An illustration is that every BA seat gets sold three times! The real problem for airlines is the additional cost, as we are charged fees for every booking made and cancelled.” Stuart Cochrane A: “In this case, churning refers to the way travellers hold seats/bookings on multiple flights or in some cases hold duplicate bookings on the same flights via different travel agents. If seats – that are subsequently going to be cancelled – are being held, the yield management and planning of carriers is impacted.” Matthew Powell A: “What agents are doing is making three

Robyn Christie, Asata ce

bookings to provide quotes for corporate customers. The customer then chooses a flight and the agent will cancel two. The problem is that the supplier then pays the GDS for three bookings even though only one is utilised.”

Allison McMurray

Who picks up the cost?

A: “The airlines primarily, as there are associated GDS costs on every ‘recycling’ transaction. To add insult to injury, churning contributes to overselling flights, another emotive and costly issue. Down the line, however, SA customers may be the ultimate point of cost ‘pass-down’, as churning implicitly affects the yield on the route and any erosion will eventually be built into fares.”

Jim Weighell A: “The GDS provides a range of services via our systems, for which a cancellation charge is made when such bookings are not fulfilled. We do not, however, levy a segment fee charge to an airline for bookings that are subsequently cancelled.” Matthew Powell

“Corporates contribute by insisting that if a quote is given that a seat is held.

What would help is if it could be clear to corporates that three quotes can be given, but no seats can be held until an option is chosen.”

– Allison McMurray

How are corporates contributing to the problem?

A: “The issue is behavioural. Different corporations contribute on a variable line based on their speed of process from request through authorisation to ticketing. When I say behaviour, it should be taken in the context of ‘normal practice’, which is usually not knowingly ‘sinful’! It’s just that shopping around or operating a slow authorisation process has become ingrained as travel procurement practice within corporations – the key to understanding why SA’s churning rate is so high lies in discovering what drives these methods. Ticket time limits are generally in place to ‘force’ a quick purchase decision, but appear to have had an highly undesirable side effect.” Jim Weighell A: “Travellers shop around via multiple

Stuart Cochrane, Comair executive manager: sales & route development

channels (travel agent and e-commerce sites).

This in turn increases the cost for the carrier and GDS, as most of these channels all use the same GDS, in which case the data and response is often going to be the same.”

Matthew Powell A: “Corporates contribute by insisting that if a quote is given that a seat is held. What would help is if it could be clear to corporates that three quotes can be given, but no seats can be held until an option is chosen. Corporates then need to understand that the seat may no longer be available”. Allison McMurray

What is industry doing about it?

A: Churning has been recognised as a significant problem in SA so the next step is to collaborate on finding the clichéd ‘win-win’ solution for airlines, TMCs and corporates.

Industry bodies such as ITMSA, Acte and Asata are the logical and best-placed groups to achieve the round-table effect. If this fails, you move to lobbying! But unless airlines incentivise improved booking behaviour or penalise ‘poor’ behaviour, it’s likely that churning will continue. If we don’t work together, airlines may have no option but to make the booking process more complex or restrictive. The speed of processing a request is a key issue in terms of corporate behaviour.

Generally fares that carry ticket time limits are low on the pricing scale, and given that the true constant in travel procurement is to drive down costs, these two issues are bound to clash.” Jim Weighell A: “We’ve identified three key areas that we have and will continue to address, namely ongoing education of travel consultants in the efficient and appropriate use of the GDS, aligning business processes within corporates to assist in meeting the turnaround times and imposed rules by airlines, and the effect this has on the reservation. It’s apparent that the onerous rules surrounding ticketing deadlines, such as the 24-hour ticketing rule*, may be playing a pivotal part in these excessive costs.”

Robyn Christie *Apparently this rule was dropped in the UK and changed to seven days, which went a long way to reduce churning.

What solution/s could alleviate the problem?

A: “The real solutions will only become apparent once a tripartite (airline/TMC/customer) understanding is reached. Self-booking tools (SBTs) in themselves cannot eliminate the problem because the issue is behavioural, not technical.

The term SBT itself is a misnomer because these systems are full process travel management tools that carry out far more than bookings. It’s true these days to say anyone can book travel, but the corporate booking process is a small component of the full management function.” Jim Weighell

Matthew Powell, Travelport director of business development in Africa

Allison McMurray, Amadeus senior manager operations and solutions

A: “Asata has adopted churning as one of its key projects this year and will continue working with industry partners to ensure the situation improves. But Asata is making it very clear that these charges may not be passed on to travel agents. Asata members merely fulfill the requirements of their customers and are frequently requested to hold reservations for different reasons. The accusation that our members choose to hold bookings for no reason is unfounded. ITMSA members have also indicated that they will not tolerate these charges being passed onto them.”

Robyn Christie A: “There’s no immediate solution other than to manage any noticeable abuse by TMCs or alternatively seek to negotiate an exclusive deal with corporates to ensure price comparisons are not required. Many airlines around the world have started implementing more rigid fare rules, which require payment and ticketing at the time of booking and actively penalise TMCs where the churning abuse is high. This practice has not yet been pursued in the SA market, but I suspect we’ll start hearing more about GDS abuse as airlines continue to seek distribution cost savings.” Stuart Cochrane A: “Travelport GDS has invested in developing a shopping tool to eliminate the need for corporates to ‘shop around’. The low-fare shopping power of e-Pricing, already available to Worldspan users, is being introduced to subscribers of Travelport’s Galileo and Apollo GDSs globally during 2009. E-Pricing finds the lowest-available fare for the dates required or provides the options on the best fare to meet corporate needs in a single search.”

Matthew Powell A: “Internet booking engines and SBTs such as Amadeus e-Travel Management are good solutions, as corporates can select their itinerary from a range of options that are all within travel policy. The travel approver will be able to see if the selection was the cheapest or not.

Ultimately, the corporate has full transparency of all the available airlines and fares (including low cost carriers) and it’s not necessary to hold each option as a confirmed booking in the GDS. From our side, we’ve been educating our agents on this subject via our Amadeus Quality Manager workshops. We tell them to use Value Pricer, our low-fare search engine, to quote without making a booking, and then only once the customer has chosen, to make a reservation in Amadeus.” Allison McMurray *Please refer to our car-rental feature for insight from Savrala’s Val van den Bergh on how churning is impacting her sector.

Next month…

Next month our panel will debate whether loyalty programmes should be pulled for individual travellers.

JUNE 2009 • BUSINESS TRAVEL NOW

17

POWER PANEL

Jim Weighell, Sure Travel corporate manager

STOCK EXCHANGE

SPECIALS

DEAL DETECTIVE

1. mozambique Rani Resorts. Free night offers. Stay five to nine nights and get one night free wherever you are staying – applicable at Indigo Bay Island Resort & Spa, Matemo Island, Medjumbe Private Island and Lugenda Wilderness Camp. Stay three to nine nights and get one

night free at your choice of accommodation – Pemba Beach Hotel & Spa or Stanley & Livingstone at Victoria Falls. Stay ten nights and get maximum two nights free of charge. Offer expires January 10 and excludes peak periods.

2. LONDON

4. SINGAPORE

6. DUBAI

British Tips. London package from R5 750 pps. Offer includes five nights’ accommodation at a three-star hotel in London, breakfast daily, three-day all-zone travel card, London sightseeing package including original sightseeing open-top bus tour, 45 minutes Thames cruise or hop-onhop-off cruise, walking tours of London, Madame Tussaud’s with Chamber Live fast-track ticket, Tower of London fast-track ticket and flight on London Eye. Special is valid until August 27.

Thompsons Holidays. “Grand Prix Mania” packages are from R15 652 pps. Rate is inclusive of return flights ex-Johannesburg, approximate airport taxes, fuel levies and surcharges, return airport-hotel transfers, four nights’ accommodation, daily breakfast, return hotel-circuit transfer and F1 race tickets. Package is valid from September 24-30.

Emirates Airlines. Dubai special – special fares ex-Johannesburg from R4 459. Offer includes airport taxes and is available on specific flight numbers only. Special is valid for sale and travel until June 25. Specials to other destinations are also available.

3. MOMBASA Holiday Tours. Go Kenya packages are from R7 540 pps. Rate is inclusive of return flights ex-Johannesburg, return airport transfers, all current pre-payable airport taxes and fuel levies, seven nights’ accommodation with breakfast and dinner daily. Special add-on fares ex-Durban, Port Elizabeth and Cape Town are also available.

Special expires June 30.

18 JUNE 2009 • BUSINESS TRAVEL NOW

5. NORTH WEST PROVINCE Tau Game Lodge. Fly-in package for two people sharing for three nights. Package price of R19 800 includes the following: return flights ex-Johannesburg to Tau Game Lodge for two people, three nights’ accommodation on a sharing basis, all meals, sundowner drinks served on safari, two safaris per day in open Land Rovers by day and night, one spa treatment per person (consists of African foot ritual and hot stone back and neck massage). Special expires end-July.

7. PHUKET Sure Tours. Pay for four nights, stay for seven at Karon Sea Sands in Phuket. Packages ex-Johannesburg are from R9 940 pps.

Offer includes return flights, airport taxes, accommodation, breakfast daily and return transfers. Offer is valid until October 31.

8. KNYSNA Three Cities. Knysna Oyster Festival special at The Rex Hotel – rates are from R540 pps and R710 single per night. Rate is inclusive of accommodation with breakfast and a complimentary bottle of wine on arrival. Rates are valid from July 3 to 12. Minimum two-night stay is applicable.

SPECIALS

Linda van der Pol, Travelinfo’s editor, is our Deal Detective, bringing you great specials from Travelinfo, the online travel information system in daily use by travel agents all over SA. Almost every airline, hotel group and car hire company is on Travelinfo, and information and specials are regularly updated. These specials are available to all staff, even for personal use. Just book through your TMC, and tell the consultant it’s a Travelinfo special. To get connected to Travelinfo, e-mail lindav@nowmedia.co.za

10. NORWAY Triton Cape Sea Travel. Fred Olsen Cruise Lines – seven nights’ “Classic Norway” cruise departing August 9.

Prices are from £750 for an inside cabin onboard the Balmoral. This includes accommodation, all meals, entertainment and port charges. Book

by July 31 to qualify for these rates.

Other specials also available.

GOOGLE

11. MAURITIUS

12. ZANZIBAR

9. GREECE Travel Vision. Athens & Santorini – five nights from R7 220 pps. Package includes return flights ex-Johannesburg to Santorini, three nights in Santorini, two nights in Athens, daily breakfast, all transfers. Package price does not include taxes of about R3 895. Add-on fares ex Cape Town, Durban and Port Elizabeth are also available. Special expires June 21.

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Air Mauritius. Special offer to Mauritius – fares are from R3 100 ex-Johannesburg or Durban and R4 100 ex-Cape Town. Valid for outbound travel until June 24. All return travel to be completed by July 2.

Falcon Africa Safaris. Packages are from R8 650 pps. Special rate includes return flights ex-Johannesburg, airport-hotel-airport transfers, seven nights’ accommodation on all-inclusive basis – all meals and selected drinks.

Special is valid until June 30. Rates exclude airline taxes of about R1 200. ■

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JUNE 2009 • BUSINESS TRAVEL NOW

19

ON THE RADAR

Oil and gas Money may claim to make the world go round, but oil is what greases the wheels. Ensuring the oil and gas industry’s travel requirements are met is no easy feat. Liesl Venter finds out more.

A

S most industries have cut down, slowed down and in some cases come to a complete standstill in the worst economic downturn in decades, the oil and gas industry has found itself having to keep the wheels turning.

It is a complex industry, where fluctuating demand and often short lead times make responsibility a key factor when looking at travel management.

Add to that the not so easily accessible destinations where companies go in search of the world’s most-wanted commodities and being able to service this unique industry becomes a remarkable task.

Wings Corporate Travel has built up a reputation in the past 16 years of meeting the very needs of oil and

“The oil and gas industry is unlike any other – it offers huge challenges to a TMC not only in getting people to the far-out destinations, but also in being able to meet the deadlines that can change at the last minute and on short lead times.” - Hendrik Du Preez

gas companies. Having experience of working in Africa, the TMC’s services are now being used from Houston in Texas to Aberdeen in Scotland.

“In some cases we create problems for ourselves by restricting our use to only the airline which our Global Aviation Safety teams have approved, but we are very strict when it comes to safety and uncompromising on standards.”

- Alan Reid “Because of our unique ability to service the most difficult continent well, one could argue it becomes easy to service the rest of the world,” says Hendrik Du Preez, Wings Corporate Travel head of business development for Africa and the Middle East.

“The oil and gas industry is unlike any other – it offers huge challenges to a TMC not only in getting people to the far-out destinations, but also in being able to meet the deadlines that can change at the last minute and on short lead times.”

Ensuring consultants are trained is but one way of doing the job well.

“We understand the industry – it is fast-paced and demanding, and time is money. Rigs cannot come to a standstill because a flight has been delayed. We are in the business of ensuring we can move people in this industry quickly, efficiently and safely.

Dependability and responsibility are key words in our line of work.”

According to Alan Reid, commodity manager – services BP Southern Africa, the primary issue is safety. “In some cases we create problems for ourselves by restricting our use to only the airline which our Global Aviation Safety teams have approved, but we are very strict when it comes to safety and uncompromising on standards.”

These are crucial aspects for a TMC to take into account, says Du Preez. “It’s about total account management rather than just looking at one or two aspects.”

20 JUNE 2009 • BUSINESS TRAVEL NOW

Not so easily accessible destinations are often where companies go in search of the world's most wanted commodities.

Understanding client needs With major oil drilling happening all over the world, Wings Corporate Travel has expanded its activities to ensure the global market can be serviced effectively.

“We’ve implemented a service that ensures everyone in the company, regardless of which office they work from, uses the same system,” says Du Preez. “We also have a call centre operating 365 days a week, 24 hours a day. When you are working with oil, emergencies can happen at any time and you must be available.”

With much of their operations in West Africa, Du Preez says keeping up to date with political events is also important.

“You need to know where people are and being able to track them at all times is important. We rate safety and security very high on the agenda.”

Says Reid: “We have oilfields in Angola, Libya, Egypt, Algeria and North Africa. Angola is often problematic with the availability of seats being so low and the costs high. Hotels in Luanda are also a challenge. Once in Luanda we never hire cars, but run a fleet of company cars and the use helicopters to fly people to/from the rigs which are offshore.”

Du Preez says understanding the complexities and needs of various clients – and reporting back comprehensively – is what makes the difference when servicing customers regardless of where they are in the world.

Global recession rocks the world There is no doubting the impact of the economic crisis on the industry, says Reid. “With an oil price at a third of what it was, but the capital and operating costs of the rigs remaining where they were, non-essential travel has been cut down.”

A deep-sea oil rig costs in excess of US$50m a week to run and an offshore production platform costs over US$500m to build.

“Motorists are also travelling less, business is transporting less and large-volume customers are reducing work output – all of this has had an impact.”

But oil rigs will never shut down and making sure people are moved is now even more important.

“The volume of people has have decreased slightly as non-essential travel has been reduced,” says Du Preez. “It does not matter though how many people you move – doing it well is what counts. In the oil and gas industry, mistakes are huge – they cost money. Ensuring travellers arrive safely is even more important, and we do that well.” ■

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ON THE RADAR

Middle Eastern airlines take flight Despite dwindling worldwide premium traffic and revenues, Middle Eastern carriers appear to be dominating the skies. Sue Lewitton reports.

Middle East as the new global hub

W

ITH airports around the Gulf reporting record growth and many Middle Eastern carriers posting growth in passenger traffic, it seems the region may be set to become one of the world’s most notable aviation hubs.

South African corporate travel, in particular, is making use of the region’s airports and according to Jim Weighell, Sure Travel corporate manager, this is largely on account of the growing trade between SA and the Middle East, and other regions to which its airports offer convenient connections. “Overall, the Middle Eastern carriers have introduced much-needed capacity, as well as price and route options. They offer high inflight quality and first-world safety standards, all crucial to securing corporate traffic.”

Another convenience, says Craig Thomas, Etihad country manager for SA, is that airports, such as Abu Dhabi, don’t have requirements for SA passport holders to obtain visas for airside transits.

Gregory Epps, Qatar Airways area

manager for SA, says Middle Eastern airports have been designed with easy transfers in mind. “As with Doha, a hub should be effortless and not require walking two kilometers and then still having to take a bus between terminals.”

Connections to the Arabian Gulf, US, Indian Subcontinent, Far East and Europe are effortless from Doha, says Epps. “With the limited number of points served directly from SA, South Africans invariably have to transit somewhere, especially when attempting to reach non-gateway destinations. The choice available from Qatar avoids the need to transit through major gateways.”

Etihad’s schedule offers enhanced connections to the GCC, Europe and Indonesia, says Thomas. “Etihad amended its Johannesburg schedule to provide for quick transfers to/from all our European gateways including Brussels, Dublin, Geneva, London and Paris. Transit times to Europe range from 90 minutes to three hours.

Transits to Bahrain, Jeddah, Kuwait and Riyadh range from 75 to 120 minutes.”

First class service on Etihad’s JNB route

A new First Class product has been launched on all Etihad Airways’ SA flights out of Johannesburg.

Features include suites with seats that rotate 180 degrees, creating a setting for up to four passengers to meet or share dinner. The seats also recline into a flat bed. The in-flight dining programme is hosted by a personal food and beverage manager, with an individual table service.

Passengers can eat ‘on-demand’ from a la carte fine dining menus or kitchen-style snacks. They will also be able to enjoy an in-seat massage and over 500 hours of on-demand entertainment on individual 17,3 inch touch screens.

Free first and business class Dubai stopovers Emirates First and Business Class passengers are being offered a free stopover package in Dubai for bookings until September 15, 2009. Free accommodation, including breakfast, will be on offer at The Address Downtown Burj Dubai. Passengers will also receive complimentary access to the Dubai Mall Aquarium and Underwater Zoo and the Dubai Ice Rink. They will also receive a voucher booklet offering exclusive retail discounts at the Dubai Mall and a free 96-hour visa for entry into Dubai. First Class passengers will be entitled to two nights’ free accommodation and Business Class passengers are eligible to receive one night.

Qatar keeps in touch QATAR Airways has announced an agreement to install Mobile OnAir inflight passenger communications services onboard the airline’s single-aisle fleet of A319, A320 and A321 aircraft as well as several new aircraft on order. The aircraft currently operate routes across the Middle East, India, Sri Lanka and Europe.

Passengers will be able to stay connected inflight using their own cellphones or BlackBerry-type devices and laptops fitted with GSM data cards.

Carriers continue aggressive expansion Fleet Routes Airport

Emirates

Qatar Airways

Etihad Airways

Emirates currently has a fleet of 129 wide-bodied aircraft.

By the end of the 2008-09 financial year, that figure will stand at 132, including four A380s. The carrier will welcome a further seven A380s in fiscal year 2009-10, as well as 10 B777-300ER and one B777-200LR.

Qatar Airways has an expansion rate that averages at almost 40% year on year. It currently operates 68 Boeing and Airbus aircraft, but its fleet size will almost double to 110 aircraft by 2013. The airline has more than 200 aircraft on order worth over $40bn.

The airline currently has a fleet of 44 narrow and widebody aircraft which will rise to 52, with one aircraft retiring recently. The new additions comprise two A330-300s, one A330-300, two A340-600s, five A320-200s and one B77-300ER.

Emirates plans to grow the number of flights across its network by 14% in 2009. It introduces services to Durban on October 1 on a 278-seat A330-200 and Luanda, Angola on August 2 on an A330-200. The airline will also increase capacity on its services to India, the US and Australasia, and has already embarked on an expansion programme into Europe.

The airline recently announced new services to Sydney and Melbourne, together with flights to Goa and Amritsar in India. Two new European services are being earmarked.

In addition to route expansion, Qatar Airways is gradually stepping up capacity to eight cities – Geneva, Kuala Lumpur, Manila, Lagos, Muscat, Mashad (Iran), Tunis and Algiers.

Etihad aims to increase passenger numbers in 2009 by 15% to a total of 7m. Its network will grow to 55 destinations.

The airline will launch services to Melbourne, Istanbul, Athens, Larnaca and Chicago as well as increase frequencies on existing routes.

Emirates has unveiled its dedicated and unique technology and entertainment corner called e-zone located in the Business Class Lounge at Terminal 3 at Dubai International Airport. It features technologies developed together with Microsoft Gulf including gaming from Xbox 360 and Microsoft Surface computers. Several applications have been developed, including ‘Destination Guide’, which allows customers to move a 3D globe to zoom in on locations and view destination information and photos.

Qatar Airways will also manage the new Doha International Airport, which is set to open in 2013 at a cost of $9bn with an initial capacity of 24m passengers per year. Once fully developed beyond 2015, the airport will be able to handle up to 50m passengers a year.

The airline’s phased move into Terminal 3 at Abu Dhabi airport has been completed. The final flight moves saw the airline’s Beijing, New Delhi, Johannesburg and Mumbai services move from Terminal 1 to Terminal 3.

22 JUNE 2009 • BUSINESS TRAVEL NOW

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Until recently, it seemed as though the Gulf region was immune to the economic crisis impacting travel to other parts of the globe. As it finally begins to feel the pinch, destinations are looking towards business travel as their salvation. Sue Lewitton reports.

Developments abound in Abu Dhabi

STOCK EXCHANGE

DESTINATIONS

The Gulf

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WAVE of hotel development is currently underway in Abu Dhabi, which has its sights on 2,7m annual hotel guest arrivals by 2012 – a target that will require accommodation room inventory of more than 25 000.

In 2008, Abu Dhabi achieved 1,5m arrivals with an inventory of 12 544.

The ability of the destination to meet these targets is largely dependent on the expansion of Abu Dhabi’s business tourism market share. According to statistics, the business tourism sector currently accounts for about 80% of Abu Dhabi’s tourism arrivals. In light of this, the Advantage Abu Dhabi initiative has been launched to encourage conference organisers and meeting planners to choose Abu Dhabi for their events.

Currently, there are 49 hotels and 46 hotel apartment properties in Abu Dhabi, all of which will be star graded as the grading scheme programme is launched in June this year.

Upcoming hotel developments include: • Abu Dhabi’s National Corporation for Tourism & Hotels is expanding Al Raha Beach Hotel by doubling its room numbers and adding three more restaurants. It is also upgrading its spa.

• Seven hotels are being built by Aldar on Yas Island, due to open in time for November’s Formula 1 Grand Prix in Abu Dhabi.

• The four-star Traders Hotel is due to open by year-end and will be operated by Shangri-la Asia Limited. It will have 301 guest rooms and conferencing facilities.

Did you know?

ABU Dhabi will host the UAE’s first Formula One race, the 2009 Formula 1 Etihad Airways Abu Dhabi Grand Prix. The event will take place at the Yas Marina Circuit over three days from October 30 to November 1, 2009. It will be the final race for the Formula One season and could potentially be the world championship decider.

Pullman enters Dubai hotel market TWO new luxury hotels under the Pullman Hotels & Resorts brand are on the cards for Dubai through a partnership between Accor Hospitality Middle East and Majjid Al Futtaim Properties. The hotels will be aimed primarily at business travellers and the MICE market.

The first hotel will be located at the Mall of the Emirates and will comprise 481 rooms, of which 84 are suites. It will be completed by the second half of 2010. It is being developed as part of the mall’s new extension plans. The second hotel, the Deira City Centre Hotel, will be unveiled after an extensive renovation scheduled over the next two years.

24 JUNE 2009 • BUSINESS TRAVEL NOW

Abu Dhabi, like any other destination in the Gulf such as Dubai, is actively targeting the business tourism sector.

Dubai releases new rules for public behaviour DUBAI authorities have released new rules for public behaviour through an article that appeared in local newspaper, Emarat al-Youm, representing tightened restrictions on behaviour that goes against the Muslim country’s customs and values. The article went on to say that any breach of the guidelines, by nationals or expatriates, carries a possible prison penalty or deportation. Guidelines include: • No expression of affection beyond a kiss on the cheek.

• Unmarried couples may not hold hands in public.

• No dancing or playing of loud music in public.

• No mini skirts and shorts outside private areas and hotels.

• No bikinis or non-traditional swimming attire on public beaches.

• Drinking of alcohol is restricted to licensed premises and private areas and no one may be caught under the influence of alcohol outside these designated drinking areas.

W Hotels arrives in Qatar W HOTELS has opened the W Doha Hotel and Residences, the group’s first entry into the Middle Eastern market. The hotel, located on the West Bay of Doha on the Qatar peninsula, features 291 guest rooms, 31 of which are suites and 154 W branded residences. All rooms feature the W Hotels’ signature bed with feather top mattress, flat-screen LCD TV, DVD player, MP3 docking station, Tivoli radio, WiFi Internet access and high-speed laptop connectivity. There are three bars on offer, a poolside lounge and three restaurants.

There is also just less than 1 000sqm of meeting and event space and gatherings of up to 500 people can be catered for. High-speed WiFi Internet access, plasma screen TVs and modern AV equipment are all available. The W Hotels trademarked ‘Sensory Set Up’ of the meeting rooms stimulates all the senses with mood music and aromatherapy scents, place cards, creative catering, retro candies and games. ■

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