The business of
corporate travel
BOB MOWAT
Travel remains a critical part of doing business, but it is also a growing spend category for many companies. As a result, corporations are looking at new ways to save, and one of the key approaches is to consolidate their travel spending.
A new research study – “Global Horizons: Consolidating a Travel Program” – from the CWT Travel Management Institute details ways that companies can reduce their total travel costs by 20 per cent on average.
“Travel program consolidation is a key lever to effective travel management,” observed Carlson Wagonlit Travel’s president and chief executive officer, Hubert Joly, during a recent teleconference.
“This study shows that a large majority of companies are working with a primary travel agency to help them in the consolidation process,” he said.
Joly explained that travel program consolidation has two major dimensions: concentration and standardization.
“Concentrating the number of suppliers is a well-known approach to purchasing. Leveraging global volume in the various categories and negotiating new conditions, playing with market share and the supplier base. With standardization, it is working with the travel policy around the world and deploying tools such as the travel portal, online booking, profile management and expense management,” Joly explained.
The CWT study discovered that companies consolidating their travel program realized savings of 20 per cent on average and three-quarters of those businesses indicated that consolidation had had a positive impact on both service and security.
The study also points out that consolidation may not be for everybody, with CWT’s boss noting that: “Frankly, if you’re spending $100,000 on your global travel budget, there’s no need to go after consolidation.”
And, while there’s no hard and fast threshold, the CWT study indicates that companies with a minimum US$5 million travel spend would be candidates to consolidate their travel program. It also added that companies also need a suitable traffic pattern that would allow volume concentration with a limited number of travel suppliers, and consolidation works well for companies with a centralized culture or one that’s experiencing pressure on costs.
To succeed, the CWT report says that companies must take a comprehensive and balanced approach, ensure they have a travel management company to partner with and make a long-term commitment to consolidation.
CWT officials pointed out that on average, companies are able to consolidate their travel programs within a three-year time frame.
NBTA
NBTA declares: ‘We
are Canadian’
New brand unveiled at
conference
The National Business Travel Association –
NBTA-Canada president Tanya Racz, said, “With the clear support of our membership, I am pleased to unveil the new ‘NBTA-Canada’ brand. NBTA-Canada will continue to work on behalf of the Canadian corporate travel industry from a Canadian perspective, and will retain its unique position as a buyer-driven organization, while further capitalizing on the advantages offered by being a part of NBTA, the world’s leading and largest business travel association.”
Racz continued, “Since the merger with NBTA in 2004, I have had literally hundreds of conversations with members about the association’s identity. Three years ago, the dominant question was, ‘Will we continue to be a Canadian organization?’ Now the question I routinely get is, ‘Why aren’t we called NBTA-Canada?’ Today, we answer that question by saying, ‘We are NBTA-Canada.’” The transition to the new NBTA-Canada brand will be completed over the course of several weeks. The new name and logo are in place starting immediately, and a new web site will be up and running soon at www.nbtacanada.org.
Who are you?
You know who you are,
now tell us the ‘who’ and the ‘where’ and perhaps, the ‘when.’
E-mail your answers to CTP’s editor-in-chief, Edith Baxter at ebaxter@baxter.net.