Businesstravel the
Magazine
TRavel management companies Y O U R
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G U I D E
Introduction, 2-4 / Debate, 6 / Service delivery, 8-12 Consolidation, 14-16 / Five reasons, 21 / New entrants, 23-26 Insight, 29 / The Directory, 30-33 / Data, 34
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TMCs / Introduction
PEAK
performance While their place in the business travel management ecosystem has often been called into question, Gillian Upton discovers that TMCs still offer an indispensable service
T
here has never been a better time to use the services of a TMC. The industry is today so complex and dynamic that buyers are crying out for a provider to be the gateway. It's an industry that's constantly evolving too. Tech-based entrants are muddying the picture by disrupting the status quo, while mergers and acquisitions are frequently changing the names and positions on the TMC league table. It's the normal lifecycle of any industry, when owners of independents find an exit route to retire, attempt to fill a large hole in their balance sheet or find a short cut to more R&D funds. New ‘families’ of TMCs are emerging, offering services for all sizes and scope of corporates, be it national, regional or global, offline or online, or a hybrid of both. They are all things to all men, a one-stop-shop for the ever-increasing number of services demanded by buyers. The downside is that it paints them all vanilla, which is maybe why new buying patterns are emerging. Buyers are making brave and interesting moves in how and to whom they award their business. When BP awarded its global business to Egencia it caused shockwaves, partly because Egencia is widely perceived as an online provider. In fact, it's a fullservice TMC with its own technology. Nonetheless a big, global player dared to 2
award its business outside of the 'big three'. Similarly, UBS splitting its business across three providers, not one, throws up an interesting management challenge of how to create a seamless operation from direct relationships with, in this case, a single global data provider, a travel management company and an online booking tool. UBS is active in over 50 markets and was crystal clear in its travel objectives: “Acquiring the right information at the right time in the hands of the right person so they make the right decision, which means the need for simplification, personalisation and consultative support as long as it delivers value,” sums up Mark Cuschieri, UBS Global Head of Travel. What’s really critical to UBS is value and Cuschieri feels that automation and technology play a key part. “Automation should satisfy 70% of our business demands and the rest is complex, high-touch and disruption management,” he says.
Think again
The UBS move gives TMCs the chance to think differently. “Secondary and tertiary platforms such as Cytric and Concur can exist themselves and no longer need to be fixed into a TMC platform, so it changes how TMCs present themselves to their clients,” explains Chris Crowley, Partner for business travel consultants Nina & Pinta.
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Introduction / TMCs
New 'families' of TMCs are emerging, offering services for all sizes and scope of corporates, be it national, regional or global, offline or online, or a hybrid of both�
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TMCs / Introduction
The market is in free fall where almost anything goes. If 70% of volume is going through a booking tool then why not contract that out separately? Caroline Strachan, Managing Partner at Festive Road, sees the emergence of four ways for buyers to proceed in this new world order: the 'Closed Shop' route of appointing one TMC and all services coming through that TMC; the 'Open Provider' where a buyer appoints a TMC and the TMC appoints third party providers; the 'Department Store' approach, where a buyer appoints a TMC and any choice of data and expense provider; and 'BYO' where buyers build their own platform and say ”I need ten different services from ten providers” and appoint the likes of Skyscanner for airlines and Cornerstone for data provision, and so on. Once you choose the route, the selection process is still a challenge as not all TMCs can deliver all three core services well: strong inventory at the right price, interfacing with the traveller and overlaying the corporate requirements of policy, safety and security. Some smart buyers are cherry picking and stitching together the best of the best. Strachan believes TMCs must face up to the identity crisis they have created for themselves, break out the colour palette and differentiate themselves from the competition. ”TMCs have gone down lots of different paths so they need to decide who they really are and invest in those areas.” Some TMCs have not been idle in finding their point of difference and the smart ones are focusing on five services: traveller profiles; payments and expense integration; data aggregation; hotel programmes; and aligning themselves more to booking and expense ecosystems, such as Concur. “It is important to have unique differentiators no matter what size the TMC or what position a TMC holds in the rankings,” says Simone Buckley, CEO of Fello. Fello’s differentiator is offering the best of both high-touch service and technology. “Our platform allows us to do this quickly and economically, regardless of the size of the customer,” says Buckley.
approach, delivering a strong experience and putting the client first is something that will always be valued,” says Fred Stratford, Chief Executive of Reed & Mackay. A point of differentiation can be to satisfy something other than the three Cs that TMC selection is based around, which is culture, cost and capability. “Customers also want to see their TMC being actively innovative and driving ongoing technology improvements,” argues Donna Fitzgerald, Customer Solutions Director at Capita Travel & Events. “This leads to behaviour-driven savings from better planning, awareness and ability for individuals to make better decisions rather than just being compliant to a policy.” Frictionless travel is a current buzzword and no price can be put on support during travel disruption. ”Value can be achieved from a TMC's services in a variety of ways,” says CTM's CEO Europe, Debbie Carling, “including the often intangible value of reliable service and expert advice especially during unforeseen travel events.” TMCs are clearly moving away from being fulfilment-driven and instead to solutionsdriven organisations. “Our role has evolved and we’re good at it,” says Julie Oliver, MD of Business Travel Direct. “We can find solutions to problems and that’s really positive.“ Independent contractor Roger Peters reckons the “golden challenge“ for TMCs is to know how to consolidate technology and data, between booked, stayed and transacted bookings.
A point of differentiation can be to satisfy something other than the three Cs that TMC selection is based around: culture, cost and capability” How big must you be to start benefitting from employing a TMC? Annual travel spend of £50,000 upwards or when you have 20 or more frequent travellers is one guideline. Online-based providers can give access to non-public rates and deliver basic reporting, which is critical to measuring and achieving cost efficiencies. The tipping point will depend on corporate resources – if they have PAs they may self-book for longer, for example. What’s to come in the TMC space is undoubtedly more change. Everybody’s watching what Amex GBT does with Neo for example, while BCD has taken the ‘If you can’t beat them, join them’ approach and moved to a single source platform called Solutions Source, integrating potential rivals and disruptors such as Rocket Trip and Yapta into their travel programme after they have been vetted and approved. “Clients are keen to try new things and to shake the tree,” says Tony McGetrick, VP & Director of Sales & Marketing UK & Ireland at BCD. “But the end game is still the same – to save money and improve the ROI.”
Above and beyond
Buyers are looking for agility, which may be via one provider or multiple providers. “I don’t think any one model will prevail as we go forwards, but being flexible in our 4
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Travel TMCs /tech Debate / Five reasons
DENISE HARMAN
Vice President, Customer Management, Western Europe, CWT
A
We can innovate in a cost-effective way that niche players and starts-ups can't” Denise Harman
SIMONE BUCKLEY Chief Executive Officer, Fello
A
s the TMC market evolves, TMC doesn’t necessarily have the competition is constantly to either be big or niche. increasing too. This means However, in today’s world of that TMCs need to keep up rapid consolidation among with the rapidly evolving TMCs, a smaller TMC does needs of the corporate buyer and business need to have its own distinct point of traveller to stand out. difference, communicate that effectively Whether you're a global TMC, and live by it. And it also needs niche player or tech start up, to understand exactly which innovation is imperative for customers will most value those survival. With 79% of points of difference. travellers stating their Certainly there are some travel experience has an specialist sectors such as impact on their job marine, oil and gas, sport satisfaction, employers and NGOs that require now see traveller specialist expertise but productivity, both large and small satisfaction and TMCs have mastered retention more the art of providing important than cost. good services to Whichever mould, these niche scale or specialism customers. a TMC fits, investing At Fello, our point It’s often said that in a shrinking market travel meaningfully in of difference is our data quality and focus on the traveller management companies need to be big integrated service because we believe operators or be specialist operators in solutions to enhance that if the traveller is traveller wellbeing, duty happy, then the travel order to truly thrive. Two TMC of care and enabling manager can focus on representatives have their say organisations to drive delivering the benefits of decisions to transform their a well-managed travel business, is non-negotiable. programme rather than fireAs a scale technology player in fighting traveller service issues. the global corporate travel market, By blending the best automation CWT is invested in – and is investing and customer-facing travel technology more now than it ever has – to enable with an exemplary – and personal – seamless, end-to-end traveller experiences customer service we can free the travel across all channels. It's this breadth of manager to actually do their day job of technology investment that enables us to managing travel. deliver digital services that appeal to Not every travel management company corporate travellers, whose expectations thinks like this but there are plenty out have evolved at the pace of technology. there that do. While our point of And with this continued drive, deterdifference satisfies our clients' mination and data requirement and investment, we can outcontinues to deliver A smaller TMC does innovate in a costvalue to customers we need to have its own effective way that niche have a bright future, players and starts-ups even though we are a distinct point of difference” simply can't. relatively small TMC.
BE BIG OR
BE SPECIALIST!
Simone Buckley
6
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03/02/2020 08:54 2/17/20 02:26 PM 1/31/20 3:26 PM
TMCs / Service delivery
GREAT expectations
Whatever you expect from your TMC, be clear about it right from the start, writes Gillian Upton
W
hich came first, the chicken or the egg? The causality dilemma neatly sums up a common issue between client and TMC, when what clients expect from TMCs after implementation depends on what they specified during the RFP. It's a flawed process which doesn’t always result in what the buyer wants. So, who’s to blame? Service delivery can be a deal breaker and it’s often not clear who or what caused the issue but Clive Wrattan, CEO of the Business Travel Association, which represents 80% of the TMC community, has an opinion. “Buyers need to give more time to TMCs before the beauty parade and TMCs need to be selective in what they pitch for.” He advises TMCs to be brave and declare that they can’t deliver on certain requirements. To move forward, TMCs must stop overselling and under-delivering. “It’s all smoke and mirrors with all of them,” sums up independent contractor Roger Peters. Gray Dawes, however, declined to pitch for the BP account and for very good 8
reasons. “I didn’t even look at the documents as it’s so out of our comfort zone,” says Dave Bishop, the TMC’s Commercial Director. “I don’t want to waste buyers’ time.”
The right fit
Best practice should be a clearly defined RFP with the minimum of relevant questions and issued only to those TMCs that can deliver. After all, it’s not worth including a high-tech TMC if the bulk of bookings are offline, for example, or a national TMC if the buyer is a regional or global player. Some TMCs, including Traveleads, prefer to take a more tailored approach. “We believe in having a personal partnership with our clients, which starts with getting to know them inside out,” says Sally Cassidy, Group Director of Sales. “This way, we tailor our service to exactly their needs, offering them something beyond the ordinary travel management solution.” Bringing in a new TMC is often linked to desired change, perhaps to improve online
adoption, to implement a self-booking tool, to consolidate supplier management, or modify travel policy. Whatever the reason, buyers should look for experience and success in the specific field with similarsized companies. The key driver for BP in finding a new TMC, for example, was the technology and consumer experience and Egencia was miles ahead on both counts. A TMC's capability, whether geographical spread and/or technological prowess, is one of the three Cs that will influence TMC selection. The other two are culture and cost. Technology is a major driver in terms of capability and proprietary technology is
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Service delivery / TMCs
the desired option, but so is cultural fit. It's vital that the TMC aligns with company goals and ethos. “We see a direct correlation between an engaged, empowered and culturallyaligned workforce and the satisfaction of our customers,” says Debbie Carling, CEO Europe at CTM.
Cost factors
Opinions vary as to the importance of cost, which is often confused with value. “A travel management company should be able to easily demonstrate a positive return for the cost of their services, whether through achieved savings,
increased efficiencies, enhanced traveller safety or traveller wellbeing,” says Carling. “The value of a TMC's services should far outweigh the cost of those services.” In the past, size has mattered and global buyers have gravitated towards the 'big three' TMCs. The BP award demonstrated that this is no longer the case, but there are other considerations. Buyers might not want to be a dominant account in a small TMC because that TMC might not have the experience to manage it well enough. Conversely, being a small account in a large TMC might mean not receiving sufficient support. ”It’s important to evaluate where your
Technology is a major driver in terms of capability and proprietary technology is the desired option, but so is fit. It's vital that the TMC aligns with company goals and ethos”
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TMCs / Service delivery
In the past, size has mattered and global buyers have gravitated towards the 'big three' TMCs. The BP award demonstrated that this is no longer the case”
business will sit,” warns Wayne Durkin, Head of Sales and Account Management at Good Travel Management.
All down to penalties
Service level agreements (SLAs) and key performance indicators (KPIs) written into the contract will ensure that key objectives for that year are met – as long as they are properly policed – and they should not be added post-RFP. Otherwise this could muddy the water in terms of a TMC being able to accurately price the specification from the outset. “A good SLA should be succinct enough to be workable and focus on the key success metrics,” advises Scott Davies, CEO of ITM. He also warns that penalties within SLAs should be appropriate to focus teams on success but not so punitive that they end up driving fear and negativity within service teams. SLAs have gone beyond response times of, say, picking up the phone within a certain number of rings, partly because of the move away from telephone as a form of communication. That’s been taken over largely by in-app chat capability. SLAs now embrace savings, cost avoidance, traveller wellbeing, traveller satisfaction and, according to Douglas O’Neill, CEO of Inntel, also “external meeting room and event ROI and reduction of carbon footprint”. 10
SLAs differ by industry vertical. For example, professional service companies and legal firms demand more of a TMC, usually expecting the TMC to undertake all transactions. This will be reflected in the SLAs. Others will expect the travellers to do their own travel booking via a selfbooking tool, so SLAs need to reflect that particular requirement. “A bank may be concerned with traveller experience, as in premium cabins at the last minute, so a set of KPIs will focus on that, whereas a manufacturing firm may seek cost efficiencies and change their sourcing patterns and SLAs around that,” says Michael Valkerich, VP Global Customer Group, CWT. “Different organisations will invest in a TMC in different ways. We don’t believe in a single vision for each client.” Either way, SLAs mean nothing if the quality doesn’t provide good service. Johan Persson, Director of Account Management UK & Ireland at Amex GBT, points out that: “When people get through [from waiting on a call] and the service is fantastic, they’re not judged on speed, but on quality.” Click Travel identifies savings and they are written into the contract as a performance metric. ”With our client Veolia we did just that,” says MD Jill Palmer. “We marked them as red, amber and green, with green being the easiest, then Veolia’s internal
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Untitled
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TMCs / Service delivery
audit department checked us every six months for the green-colour savings and we delivered each time.” What should be clarified in the contract is what level of account management is included and when that cuts off, triggering higher consultancy services. This early level of transparency will pay dividends later. Day-to-day account management should feel like an extension of the travel manager’s role and client team. Account managers should know the programme intimately, be driving it forward and optimising spend after analysing six months’ worth of data. Priorities will differ from client to client but basics should include review meetings, travel analysis reporting, technology implementation and training, loyalty programme management and supplier negotiations. TMCs should understand the company culture and be fully conversant with the programme vision. A poor level of account management is often at the root of a client moving TMCs, not service, underscoring the fact that although automation deals with the majority of bookings, it’s still a people business. Some TMCs treat their account managers as consultants who look after the totality of the account and that's part of the overall fee, while others separate it out as a lucrative income stream. That’s more likely to happen with larger clients when specialist services are required, such as programme improvement, benchmarking a programme by size or industry, formulating a strategic vision, innovation, global consistency and so on.
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For example, an account manager could not be expected to source a full hotel programme single handedly. “When there is a new requirement from the client that is resource heavy and will not benefit another customer, this is where consultancy fees usually begin,” says Anne Marie Crawford, Head of Sales at Inntel. BCD's consultancy arm Advito specialises in complex air and hotel programmes across the globe and specific bespoke communications programmes to change traveller behaviour. ”There is a cost to providing this high-level and intelligent programme activity. If clients had to go out to the market and speak to a third party they would pay significantly more,” says Tony McGetrick, VP & Director of Sales & Marketing UK & Ireland at BCD. “We sell in the benefits and the genuine ROI.”
Flexible pricing
What you pay is a moot point. Pricing models are in a state of flux as buyers seek more consumer-based pricing models so the market is ripe for change. Transaction fees are the norm, but subscription-based pricing and trip-based pricing are likely to become more popular pay-as-you-go formulas which suit SMEs. “The key thing is that we have to be flexible about how we price our services,”
What you pay is a moot point. Pricing models are in a state of flux as buyers seek more consumerbased pricing models so the market is ripe for change” says Durkin at Good Travel Management. “It’s done on a case by case basis, driven by the client, and can make us more competitive.” The TMC is using trip-based pricing with clients in the renewable energy sector where travel is billable. Inntel is doing the same with some clients. Business Travel Direct is currently in discussion with some clients on pricing alternatives. “The subscription model really excites me if we are going to be more solutions-driven and not fulfilment-driven but it’s got to be a collaborative process as not one size fits all,” says the TMC's Managing Director Julie Oliver. As ever, the market is in a state of flux, the dynamics of which help move the industry forward, but it’s worth noting that the fundamentals of transparency and honesty remain the core values desired by buyers from their TMC suppliers.
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Delivering what really matters TM
Technology that works
Compliance and cost savings
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TMCs / Consolidation
An acquired
TASTE
Mergers and acquisitions among TMCs continue unabated, but why is it happening and what does it mean for clients? Gillian Upton reports
C
harles Darwin’s theory of natural selection published in 1869 may not have had universal acceptance from many naturalists at the time but his theory of evolution – that only the strong survive – couldn’t be a better metaphor for the world of TMCs today. To say that there has been movement in the TMC marketplace is to underplay just how many travel management companies have disappeared recently. One industry observer reckons ten have either been bought or acquired over the last two years alone, including HRG, Giles Travel, Hillgate,
Portman, Amber Road, Ian Allan Travel and Business Travel Direct. We also know that Diversity Travel will be up for grabs in 2020 – a surprising announcement – and they certainly won’t be the last to seek a suitor. “Smaller players who don’t own their own technology will be vulnerable,” reckons Jill Palmer, Managing Director of Click Travel. “I can imagine four or five of those changing hands in the next 18 months.” Few believe that further consolidation will touch the 'big three' – Amex GBT, CWT and BCD – so the money is on the independents who need scale to thrive; those with a turnover under £100million. “Consolidation raises the bar for entry into the world of TMCs,” says Tony McGetrick, VP and Director of Sales and Marketing at BCD. “It takes a long time and deep pockets. We’re in 109 countries for example.”
Too many players
At well over 100 in number, there are too many TMCs operating in the UK, something not replicated in other countries, including our continental European cousins in the larger business travel markets of Germany and France. A cull is certainly in order for the health of the entire industry. In Darwinian terms, only TMCs with favourable adaptations will survive and that is exactly the 14
strategies being employed. The step-change in the market – chiefly around new technology and distribution flows – is the major trigger as scale is more important in times of disruption. Michael Valkerich, VP Global Customer Group for CWT, says: “Scale creates advantages so there is always going to be a current of acquisitions. The larger players do better when new changes come along as we can exert more authority.” Some TMC owner-managers are reaching retirement and are looking for an exit route, while others can no longer support their business structures, particularly in light of the huge investment required to develop or acquire new technology. Some become financially vulnerable when they lose a large spending client, the most recent example being Amber Road when it lost the BT account. The ever-decreasing income from the GDS as the airline distribution landscape evolves is another nail in their coffin. Dave Bishop, Commercial Director at the acquisitive TMC Gray Dawes, believes there are other strategies at play: “Consolidation can shortcut the R&D route to acquire the technology required as CTM did when it purchased Redfern. TMCs can take out a competitor and change the market dynamics, as Amex GBT did when it
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bought HRG and Reed & Mackay did when it bought Hillgate. That immediately gives you market dominance and you can charge a premium. Or you do it to buy scale if there are synergies with another TMC.” Aside from major league player HRG, the majority of the consolidated TMCs are smaller businesses because the current marketplace means it’s difficult for them to compete and stay relevant. They need to adapt, which means either selling up or growing, either organically or by acquisition.
Pros and cons
Consolidation isn’t all positive as the biggest impact can fall on the corporate buyer. Rolls-Royce, for example, selected HRG over Amex GBT in its last TMC RFP, only to find itself hooked up with Amex after the HRG acquisition under a five-year contract. There were many HRG clients playing a waiting game to see if service delivery would remain constant and some have not transitioned. In contrast, Reed & Mackay’s acquisition of Hillgate was seen differently, as a free technology upgrade and a win-win for buyers in terms of value-adds. These two successful high-touch, white glove providers were obvious partners: Hillgate with brilliant technology and Reed & Mackay with the better global reach. Group CEO Fred Stratford prefers to describe the deal as “joining forces” rather than an acquisition. Business Travel Direct has since moved to the group too. Consolidation is widely seen as a positive in the industry. In Darwin-like terms, it lets the strongest survive. One very happy TMC boss on the morning of the HRG announcement was Graham Ross, General Manager UK of FCM, who tweeted: “Good news, FCM is now the fourth-largest TMC in the world”. Consolidation certainly offers opportunity as TMCs jostle for position.
Some TMC managerowners are reaching retirement and are looking for an exit route, while others can no longer support their business structures” 16
Consolidation isn’t new to the industry either. There was a period around the early 2000s when major acquisitions and mergers also took place. What’s notably different in the current phase is the presence of venture capitalist and private equity firms with plenty of money to invest and support a TMC’s expansion plans. Travel Counsellors, for example, backed by independent European investment firm Vitruvian Partners, benefitted from a £6million investment in new technology. Since The Appointment Group (TAG) secured the backing of private equity firm Apiary Capital, it has been able to expand, acquiring SOS in the US for example. The injection of capital from private equity firm Inflexion to Reed & Mackay in 2016 has allowed a spate of acquisitions, including Gray’s Travel Management, TMC Frequent Flyer Travel Paris, Hillgate and Business Travel Direct. Gray Dawes has been particularly acquisitive, buying nine TMCs over the last four years, the most recent being Amber Road. It utilises an integration team before and after acquisition to ensure any new TMC is embedded seamlessly. ”We buy businesses where we know we can add value,” says Bishop. “Amber Road was a business that had been considerably
larger and we had offices in the same city (Manchester) so we consolidated there. We were using the same technology platform (Atriis) and the same GDS and back-off systems and we are both re-sellers of Concur, which is a strong value proposition. “We weren’t looking to make another acquisition but it gave us more scale in Manchester and the north west generally as Amber Road had an office in Leeds, which is an important area for us, so there were lots of synergies that worked for us.” Gray Dawes can now bid for larger pieces of business. Four years ago the company had a turnover of £27million and could only look for business under £5million. Anything larger would make travel managers nervous. Today, with a turnover of £200million, the TMC bids for accounts not greater than £20million, which represents around 10% of its business. “Otherwise it would leave a big hole in your revenue if you lost it,” cautions Bishop. The logic is there and Gray Dawes’ journey typifies current activity. Clive Wratten, CEO of the Business Travel Association, reckons consolidation drives change for the better. “The industry hasn’t crashed and burned; it’s just a period of disruption,” he says. The TMC community is doing what it has always done, adapting to survive.
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Glimpse the future of travel technology
Vist FCM at the Business Travel Show
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Changing Mindsets, Changing Travel
Leaving things behind. In an ideal world, it’s something we could all do without. Lodgings and vehicles around the world have feasted on their fair share of forgotten phones, laptops, suitcases and the like; bringing travellers that all too familiar feeling of helplessness and frustration that just explodes from our toes to the heavens. However, sporadic loss of material things does little to sway how or when we travel and it’s often forgotten that the most valuable thing we leave behind when we travel -- is carbon. Business travel remains an essential connector of people and vital to the exchange of ideas and goods that has made our world a better place in so many ways. Which is why it makes sense to determine every possible way to make travel more
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sustainable and worthwhile - even on an individual level. As regulations on reporting emissions rises and employee values press on travel managers and ultimately companies as a whole, change is needed. Showcasing buy-in, creating flexibility in travel policies and ensuring useful information is accessible helps drive mindful decisions throughout the business.
Carbon offsetting is a key part of the sustainability solution for companies and business travel, fueled by reliable carbon insight data. Simply having the tools that provide CO2 data means a monetary figure can be put on emissions and paid to offset through environmental programmes.
On both European and transatlantic trips, the haunting presence of plastic is everywhere we go — from cups to cutlery, from the plane to the hotel. That’s why being prepared and informed about what can dramatically increase our carbon footprint enables travellers to make changes and reduce their carbon footprint.
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Tools to take action: Regular, detailed, carbon impact data roundups are available for companies who want to receive comprehensive reports summarizing their carbon footprint to help them take action and offset. TripActions reflects the global business traveller community -- as diverse, as driven, and as hopeful about a future that uses the right balance of technology and travel agents to empower the in-person meetings that make business travel a strategic lever for culture and growth. #LetsGo
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PUSHING NDC BOUNDARIES Blue Cube Travel has been booking NDC content for almost two years – now it’s spearheading a Triangle of Trust between airlines, TMCs and corporates
I
n 2019, the topic that gained more momentum than ever in the business travel industry was NDC. The major TMCs and technology providers all made a raft of announcements about going live with pilots and first NDC bookings. But are any of these solutions workable or genuinely going to give corporates access to NDC content any time soon? At ACTE’s global summit in Amsterdam last October delegates attending the ‘NDC: loaded’ session were asked ‘Do you think NDC is live?’ Only five per cent of attendees put their hands up to say ‘yes’. That sums up the confusion in the marketplace and frustration among corporates. Blue Cube Travel is on a mission to help corporates make sense of it all. The independent travel management company has been booking NDC fares since June 2018 via its online booking tool, BC Online, powered by Atriis. This includes British Airways, Lufthansa and American Airlines. Coming soon will be Air France/KLM, United Airlines and Finnair. Blue Cube is also now piloting the ability to service and amend NDC bookings with Atriis.
Bex Deadman, Blue Cube Travel’s Commercial Director, who represents the TMC at high-level IATA NDC workshops, says: “There is no doubt that corporates in general are beginning to feel frustrated, as from their perspective they are trying to run a travel programme which utilises best available rates and gives parity. “However, from our perspective at Blue Cube, because we are a smaller independent TMC, we have been able to take a much more agile approach to integrating a workable NDC solution. The larger TMCs are now suddenly announcing that they’ve made their first live NDC bookings, but Blue Cube has been making live bookings for over 18 months – we just didn’t shout about it publicly.” Not only has Blue Cube been quietly leading the way among SME TMCs in terms of NDC integration; they have also been proactively positioning themselves as ‘educators’ on the topic, sharing knowledge
with industry peers and feedback with IATA implementation teams. “We are passionate about creating a ‘Triangle of Trust’ between airlines, TMCs and corporates, as we see this as the key to busting the myths around NDC and making it a reality across the corporate sector as a whole,” says Bex Deadman. “There are two different aspects to NDC – the first is based on technology, booking functionality and the utopia it presents. This is where real progress is being made. But the second is around the commercials between each party in the value chain – that’s the elephant in the room which is hindering progress. “As an industry, we all want NDC to work, but there needs to be understanding between everyone involved. Our aim now at Blue Cube is to encourage open conversations, to bridge the gap between suppliers and corporates and spearhead mutual understanding for the benefit of our customers and the industry as a whole.”
bluecubetravel.co.uk / sales@bluecubetravel.co.uk / 020 8948 8188 BlueCube.indd 1
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Five5 reasons / TMCs
[ FIVE REASONS TO... ]
CONSIDER GOING IT ALONE Neil Ruth, co-founder of Taptrip, argues the case for managing a corporate travel programme without the aid of a TMC
1 2
ENTRY
SPEED ,
TMCs often impose spend qualification thresholds or large booking fees. These are a potent barrier to entry for some companies, especially for SMEs looking to take their first steps into a co-ordinated travel and expenses strategy. Faced with these financial obstacles, many growth businesses choose to manage their own early travel needs and simply grow with the demands.
In an age where holidays can be booked with three taps on a screen and all your travel documents are on a smartphone, the fact that some TMCs still operate primarily via telephone conversations can feel archaic, especially when there are multiple trips to book or odd travel legs. Telephone conversations do not scale, and they impose a lot of informal process on the customer before they ring the TMC, especially compared to booking direct online.
3
BLEISURE Bleisure – adding leisure travel at the start or end of business trips – is a reality. In a recent survey by hotel group Great Hotels of the World, 75% of respondents said they had extended business trips for leisure purposes, and in most cases doing so multiple times in a year. Dealing direct with the travel or accommodation provider makes this far more accessible and easier to keep track of.
PERSONAL The relationship between many end users and their TMCs is highly transactional. This leaves little room for personalisation for frequent travellers and in many cases this personalisation is vital. It is not just about the preferences of the CEO, but any need for personalisation that is better handled by going direct to the suppliers.
5
EXPERIENCE Let’s be honest: using TMC software can suck. In an age of consumer grade user experience (UX) and highly intuitive apps, business users will simply not tolerate awkward processes, jargon-filled screens and ugly software. By comparison, a smartphone app that mimics their favourite social media layout and integrates with a management dashboard will win every time.
Business users will simply not tolerate awkward processes, jargon and ugly software”
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New entrants / TMCs
Making it
click
A breed of new technology-based travel management platforms are shaking up the global business travel market, writes Rob Gill
T
he user experience of online booking tools provided by traditional travel management companies has long been a bugbear of both buyers and travellers, with a typical comment being: 'why can’t these tools be as easy to use as consumer travel sites?' Quite reasonably, TMCs usually reply that their online booking tools are doing a lot more complex work than a consumer booking platform. This includes giving travellers access to negotiated rates with preferred suppliers, adding travel policy requirements and offering tracking abilities to improve duty-of-care. But TMCs are now facing renewed pressure from a new
breed of technology-orientated business travel specialists – including TravelPerk, TripActions and Lola – who are well funded and are already making inroads into the corporate market, particularly at the SME end of the spectrum. User experience, or UX as it is often called these days, is everything to these new entrants and the chief selling points for their platforms are their ease of use and access to a wider range of travel suppliers. This is also backed up by customer support services for travellers and providing the capabilities buyers are looking for, such as the inclusion of their travel policies, approvals processes, invoicing, tracking and reporting.
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TMCs / New entrants
Content and user experience will be key, giving the end user confidence in the pricing, and the booking process leads to higher adoption levels” Richard Viner, UK Country Manager for Barcelona-based TravelPerk, says: “We are different from traditional TMCs because we offer a shopping and booking experience every bit as good as the one you have when booking your holidays. In some ways it’s even better, as we believe we’ve built the world’s largest bookable inventory.” TripActions says it can reduce the average booking time for a business trip from 60 to six minutes, as well as increasing adoption and traveller satisfaction rates, which in turn drives higher savings for the client. Ariel Cohen, TripActions co-founder and CEO, adds: “Business travellers expect the same convenience, choice and instant gratification they get as consumers, yet until now the vast majority of the corporate travel management industry has failed them. “We’re building on our history of innovation, reimagining the TMC to give enterprises and their travellers unheard of choice and transparency to earn their trust. “Travel managers no longer have to compromise; they can finally get a great user experience and scalable global infrastructure in a single platform.”
24
TMCs under threat?
With this influx of new tech-based competitors, are the traditional TMCs quaking in their boots? Or are the likes of TravelPerk and TripActions more of a competitor in the SME market than for larger global corporations looking for a multi-country or global approach to their travel management needs? Caroline Strachan, managing partner at consultancy Festive Road, says Expedia’s tech-based TMC Egencia was a forerunner to the new entrants now making their presence felt. “If I were a betting woman, I’d be sure to place a bet on the likes of TripActions and TravelPerk’s ability to run fast and solve problems legacy players haven’t even thought about,” she says. “Their ownership of every customer touchpoint is what will make the difference, whether it’s online, mobile or with an agent, the platform experience is all the same.” John Hobbs-Hurrell, international partnership manager for WIN Global Travel Network, believes the new tech-based players will “become just another competitor” over the next few years. “Content and user experience will be key, giving the end user confidence in the pricing, and the booking process leads to higher adoption levels,” says Hobbs-Hurrell. “TMCs will need to match that offering via their own solutions. Providing the customer choice, around-the-clock support and a blend of online and offline will ensure the traditional TMC remains a viable solution.”
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Untitled
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FlexiPerk is the newest addition to TravelPerk, Europe’s fastest growing online travel management platform which offers the world’s largest travel inventory, automated travel policies, smooth UX, and consumer prices alongside 24/7 support. When booking business trips, travellers have to choose between flexible fares that are on average 60% more expensive, or risking the cost of a cancellation.
With FlexiPerk, businesses pay 10% of the price of a trip to receive a 90% refund—for any reason. You can choose to cover trips for all travellers or just a specific group. Cancel the entire trip if you need to, or just one reservation, such as the hotel, flight, train, or car. With FlexiPerk, business travel is finally flexible.
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Untitled-3 1 new entrants_v4.indd 25
24/07/2019 16:37 2/17/20 02:32 PM
TMCs / New entrants
Some traditional TMCs are also working with these newcomers. American Express Global Business Travel has been partnering with Lola for the past 12 months, a move which helped Lola to add “hundreds” of new SME customers in the first half of 2019. Meanwhile ATPI Group has been working with TripActions as a “fulfilment partner” to the technology platform since the start of 2018. “We are one of the global fulfilment partners for TripActions, currently ticketing and invoicing across seven markets with new markets being added every week due to their rapid growth,” explains Katie Skitterall, Director of Sales and Operations UK, for ATPI.
Brave new world
in 2019 and the number of employees set to reach 430 by the end of the year. There are also even newer competitors entering the market, such as Manchesterbased Taptrip, which launched in 2018 and has recently received investment as part of ATPI's new Endeavour programme. It offers a “free to use” platform combining personalised travel arrangements, expense management, live journey updates and management information. How this kind of burgeoning competition shapes the TMC market in the next few years will be one of the industry’s most fascinating trends. “As technology and content lead the way in the industry, these guys have the size and scale to be a threat to TMCs of all
shapes and sizes,” says ATPI’s Skitterall. Meanwhile Festive Road’s Strachan suggests a TMC’s ability to prosper will depend on deciding “which bit of the market you want to thrive in”. “If each TMC knows its strengths and identity, and then operates in that way, there is still room for many to succeed. What they can't all do is just chase the same customer with the same promises,” Strachan explains. At the very least, the tech-based newcomers should force traditional TMCs to speed up the improvement of their online booking tools and platforms. With this kind of market dynamic, maybe one day both buyers and travellers will stop moaning that they aren’t up to scratch.
So what’s next for these new entrants to the TMC world? Expect more rapid growth as the likes of TripActions, TravelPerk and Lola raise even more money for investors. Last July, San Francisco-based TripActions raised another $250million from investors in its fourth round of fundraising – taking total investment to just under half a billion dollars. This latest cash injection means TripActions as a company is valued at a staggering $4billion; not bad for a company only launched in 2015. Unlike some of its competitors, TripActions is also looking beyond the SME market with the aim of capturing business from organisations of “every size”. Currently the company says it has 2,000 clients around the world with up to $1.1billion in annual travel spending, including clients such as WeWork, Lyft, SurveyMonkey and Sara Lee Frozen Bakery. Meanwhile TravelPerk raised another $60million last summer, taking total investment up to $134million, with revenues forecast to increase by 300%
If each TMC knows its strengths and identity, and then operates in that way, there is still room for many to succeed. What they can’t all do is chase the same customer with the same promises” 26
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Untitled
HERE’S TO THE COOL, CALM AND CONNECTED. To a travel management platform that lets your business glide through. One that drills down deep to find you the best value. A savvy system that always keeps your staff up to date. So they stay connected. And never miss a connection. A platform where you can see everything clearly with complete business transparency. Here’s to working smarter. To travelling the world. Effortlessly. reedmackay.com
Untitled-3 Untitled-1 1 new entrants_v4.indd 27
22/01/2019 14:12 12/2/19 06:16 2/17/20 02:32 PM
We put innovation at the heart of your programme.
Š 2020 BCD Travel. All rights reserved.
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bcdtravel.com 31/01/2020 12:00 1/21/20 6:19 PM
Insight / TMCs
TMC RFPs
MOVING TIME It could be a busy year for TMCs as buyers consider their next move, writes Chris Crowley of Nina & Pinta
M
any topics are hot on the agenda in 2020, including NDC, data privacy and protection, sustainability, traveller wellbeing, meetings management, hotel programmes and traveller security, to name just a few. It promises to be a busy year by all accounts, with the global political climate almost as turbulent as the environmental one. Yet underneath all of this, a very familiar topic is gathering strength for many corporate travel managers – the selection and management of their TMC, technology and expense vendors for the years ahead. We don’t tend to publish contract life cycles as an industry. Its not really good business sense to begin with, but it’s also an area – especially in the TMC arena – where extensions, market developments, mergers and acquisitions can all play a part in moving the goalposts for
Insight.indd 29
many corporate buyers. That being said, 2020 looks like being a very active year in the TMC sourcing business. Why is that? A number of factors come into play here which are worth noting.
The need for choice
The bigger programmes have always been influenced by the need for choice. The acquisition of HRG by American Express Global Business Travel in 2018 had a significant impact on the perception of choice available to the larger customers. It’s hard to say how many RFP processes were delayed, but some most certainly
Priorities elsewhere
Many large programmes have been focussing on other areas, most notably end-to-end expense integration, security and hotel programme optimisation – not to mention the continuing shift to mobile and its impact across corporate policy in more areas than just travel.
Natural contract turnover
Another point of reference here is a more organic one. The majority of large programmes are more likely to retain their vendor (barring disaster or bad performance) for a second, and often third, contract. Most TMC contracts are usually positioned around a three-year term with a two-year extension (the 3+2). Assuming two retentions from the original contract, programmes that have been secure since the late 2000s will now be in a situation where good governance and market development simply forces an RFP process. For many corporate buyers this will be the first time in a few years they go to market for a TMC partner; in many cases they may be questioning if they need one at all. Given the factors above, 2020 is poised to be an interesting year for the travel consulting space.
CHRIS CROWLEY Chris has recently joined travel consultancy Nina & Pinta. He has extensive experience across the industry including roles at HRS, BCD, Concorde Hotels and Accor Hotels.
THEBUSINESSTRAVELMAG.COM
© MOSTAFA MERAJI
2020 MEANS
were. Emerging players such as TripActions were not necessarily ready for the big bids at that time, and there were areas of impact within the bigger TMC networks around content and profile management that needed to play out.
THEBUSINESSTRAVELMAG.COM
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TMCs / The 2020 Directory
TMCs 2020: Who does what
Your guide to a selection of leading travel management companies in the UK (A to G)
Information supplied directly by TMCs to The Business Travel Magazine. Annual figures quoted refer to a TMC's most recent financial or calendar year and to UK corporate business only unless stated otherwise. *as at 30 September 2019
Travel management company
Annual turnover UK
Annual transactions
Online / Offline
Company size
Head office
Established
Alliance membership
ABT-UK
£9million
17,000
50% / 50%
10 staff / 1 office (400 staff globally)
London
2001
Advantage
Access Bookings Ltd
£50million
351,000
30% / 70%
207 staff / 7 offices
Lichfield, Staffordshire
1985
ACE Travel Management
£7.8million
22,500
80% / 20%
14 staff / 1 office
Brentwood, Essex
1992
American Express Global Business Travel
£1.9billion
Not disclosed
Not disclosed
2,300+ FTE staff
London
2014
Applehouse Travel
£29.1million
59,300
17% / 83%
40 staff / 1 office
London
1984
arrangeMy
£32million
88,700
70% / 30%
64 staff / 2 offices / 1 implant
Worcester
1990
£1.29billion (globally)
4.78million
30% / 70%
1,850 staff / 100+ locations worldwide
London
2002
£5million
13,000
100% offline
8 staff / 1 office
Tunbridge Wells, Kent
1895
£674million ($27.1bn globally)
Not disclosed
55% / 45%
1,026 staff (13,800 globally) / 12 offices
London
1981
£36.4million
39,500
15% / 85%
36 staff / 3 offices
London
2003
Advantage
Business First Partnership Limited
£25million
60,000
20% / 80%
32 staff / 1 office
Beaconsfield, Bucks
1997
Radius Travel
Capita Travel and Events
£580million
4.1million
80% / 20%
707 staff / 5 offices
Derby
1972
Advantage / GlobalStar
Clarity
£441million
2.5million
Not disclosed
600 staff / 15 offices (UK&I & Netherlands)
Manchester
1959
Radius Travel
Click Travel
£237million
2.25million
97% / 3%
237 staff / 1 office
Birmingham
1999
Advantage
Clyde Travel Management
£60million (globally)
180,000
2% / 98%
90 staff / 5 offices (plus USA/India/Sweden)
Glasgow
1989
Advantage / WIN
Corporate Travel Management (CTM) Europe
£680million (Europe)
4.89million (Europe)
Not disclosed
2,600+ FTE staff across four continents*
London
1994
£33million
60,000
30% / 70%
85 staff / 3 offices
Tunbridge Wells, Kent
1988
$25billion (globally)
62million
Not disclosed
17,300+ staff across 153 offices globally
Minneapolis (global HQ)
1994
£148million
302,400
100% offline
130 staff / 4 offices
London
1980
£82.9million (globally)
234,000
36% / 64%
151 UK-based staff
Manchester
2008
£37million
41,600
11% / 89%
37 staff / 3 offices
Bushey, Hertfordshire
2002
$12billion (globally)
Not disclosed
92% / 8%
3,200+ staff globally across 65+ countries
London
2002
Eton Travel
£35million
104,400
40% / 60%
80 staff / 2 offices
Eton, Berkshire
1969
FCM Travel Solutions (inc. Corporate Traveller)
£849million
2.2million
46% / 54%
845 staff / 21 offices (6,500 staff globally)
New Malden, Surrey
2004
Fello
£30million
40,250
30% / 70%
41 staff / 1 office
London
2018
Advantage / GlobalStar
Flightline Travel Management
£5.65million
27,600
18% / 82%
10 staff / 1 office
Haddenham, Bucks
1999
Advantage
Global Travel Management Limited
£24.7million
39,400
22% / 78%
30 staff / 2 offices
Woking, Surrey
1997
Advantage / WIN
ATPI Baldwins Travel (BBTM) BCD Travel Blue Cube Travel
CT Travel Group CWT DialAFlight Corporate Travel Diversity Travel EFR Travel Egencia
30
Advantage / WIN
Advantage / WIN
Advantage
Advantage
Advantage / WIN
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The 2020 Directory / TMCs
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TMCs / The 2020 Directory
TMCs 2020: Who does what
Your guide to a selection of leading travel management companies in the UK (G to W)
Information supplied by TMCs to The Business Travel Magazine. Annual figures quoted refer to a TMC's most recent financial or calendar year and to UK corporate business only unless stated otherwise. *inc. Altour, Pro Travel, Tzell & Colletts Travel
Travel management company
Annual turnover
Annual transactions
Online / Offline
Company size
Head office
Established
Alliance membership
Good Travel Management
£22.5million
66,000
27% / 73%
44 staff / 2 offices
Kingston Upon Hull
1833
UNIGLOBE
Gray Dawes Group (inc. Amber Road)
£200million
550,000
55% / 45%
242 staff / 7 offices
Colchester, Essex
1927
Advantage / Radius Travel
Harridge Business Travel
£17.4million
50,000
20% / 80%
23 staff / 2 offices
London
1983
Advantage
Hotel and Travel Solutions (HTS)
£16.1million
Not disclosed
22% / 78%
26 staff / 1 office
Worcestershire
2010
Inntel Limited
£89million
410,000
73% / 27%
145 staff / 3 offices
Colchester, Essex
1984
Advantage / Radius Travel
£375million (globally)
Not disclosed
64% / 36%
600 staff / 15 offices (globally)
London
1980
Advantage
Meon Valley Business Travel Limited
£40million
120,000
40% / 60%
81 staff / 2 offices
Petersfield, Hampshire
2002
Advantage / WIN
MIDAS Travel Management
£23million
Not Disclosed
8% / 92%
25 staff / 1 office
London
1998
Advantage / WIN
Norad Travel Limited
£34million
112,000
5% / 95%
54 staff / 1 office
Liss, Hampshire
1981
Advantage
Omega Business Travel
£10million
25,000
10% / 90%
13 staff / 1 office
Hersham, Surrey
1982
Advantage
Omega World Travel
£39million
175,000
60% / 40%
25 staff UK (460 in 40 US locations)
London
1972
Advantage / GlobalStar
Quintessentially Corporate Travel Management
£20million
20,500
15% / 85%
30 staff / 1 office
London
1971
Advantage
Reed & Mackay (inc. Business Travel Direct)
£608million
1.6million
34% / 66%
511 staff / 10 offices
London
1962
Advantage
Review Travel Limited
£12.3million
89,000
34% / 66%
23 staff / 2 offices
Cheshire
1982
Advantage / WIN
Selective Travel Management
£91.2million
212,300
26% / 74%
130 staff (Belfast & Dublin)
Belfast
1972
Advantage / WIN / TSI
Simplexity Travel Management Limited
£7.1million
27,000
100% offline
14 staff / 1 office
London
2011
Advantage / Virtuoso
Sunways Business Travel
£14million
35,000
10% / 90%
20 staff / 1 office
Longfield, Kent
1973
Advantage
TAG
£232.6million
471,300
6% / 94%
194 UK staff (380 staff globally)
London
1988
Advantage / Virtuoso
Trailfinders Corporate Travel
£33.5million
11,700
100% offline
1,080 staff / 34 offices
London
1970
Travel and Transport Statesman
£201.6million ($3.5bn globally)
512,000
47% / 53%
165 staff / 3 offices (1,750 staff globally)
London
1975
Travel Counsellors for Business
£170million
Not disclosed
100% offline
200+ Corp. Counsellors / 7 countries
Manchester
1994
Traveleads
£38million
105,000
38% / 62%
80 staff / 3 offices
Leeds
1971
Travel Leaders Group UK Ltd*
£252million
407,000
24% / 76%
362 staff / 6 offices
London
1999
Advantage / Virtuoso
Wayte Travel Management
£39million
86,000
100% offline
50 staff / 4 offices
London
1980
Advantage
West End Travel Ltd
£12.8million
32,000
100% offline
19 staff / 2 offices
London
1972
Wexas Travel Management
£27million
55,500
40% / 60%
45 staff / 2 offices
London
1970
Wings Travel Management
£108million
140,800
12% / 88%
75 staff / 4 offices
London
1992
Key Travel
32
Advantage / Radius Travel
Advantage / ITMA
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The 2020 Directory / TMCs
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Entertainment/TV/Film
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Creative
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Charity
Advertising
Academic/Education
Business sectors in which clients operate or the TMC specialises in
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THEBUSINESSTRAVELMAG.com
TMC directory_V3.indd 33
33
17/02/2020 11:44
TMCs / Data
Comings
AND GOINGS
Online adoption, TMC acquisitions, bleisure travel and more…
76
%
...of companies are generally supportive of bleisure travel if employees pay their way
Notable exceptions
2.4
the number of times a year, on average, that European business travellers extend a trip for pleasure
Amber Road (bought by Gray Dawes) Business Travel Direct (bought by Reed & Mackay)
(SOURCE: CWT)
37
%
...of business travellers feel the most stress before a trip when they’re planning, booking and organising travel
(SOURCE: CWT)
Three TMCs that have regularly featured in our annual Directory do not appear in this year's edition following their respective acquisitions. THEY ARE…
Ian Allan Travel (bought by Clarity)
The online adoption challenge What percentage of your travel bookings are made through an online booking tool?
(SOURCE: SAP CONCUR)
Don’t use an OBT
76-95%
26%
6%
96-100%
15%
Less than 50%
27%
Don’t know
1%
51-75%
94
%
25% ...of business travellers are willing to share PERSONAL INFORMATION to improve their business travel experience
(SOURCE: BTS)
(SOURCE: SAP CONCUR)
What’s
MOST EXCITING
EUROPE
ASIA
GLO ba ll y AMERICAS
(SOURCE: BTS)
-PACIFIC
about business travel?
67
(SOURCE: SAP CONCUR)
30 % ...of travel managers have considered ditching their TMC and ‘going it alone’
34
%
...of business travellers believe their company lags behind when it comes to adopting the latest technologies
Visiting new destinations
33% 35% 34% 28%
Face-to-face 21% 18% 27% 16% networking Getting out of your work 18% 18% 13% 25% routine Meeting a colleague for 17% 16% 16% 19% THE first time (SOURCE: CWT)
THEBUSINESSTRAVELMAG.com
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Save the date SEPTEMBER
15-16
2020
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The 2020 event for buyers and arrangers of business travel & meetings
For further information contact Kirsty.Hicks@bmipublishing.co.uk or Callum.Blackwell@bmipublishing.co.uk thebusinesstravelconference.com
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2/17/20 05:25 PM
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