Travel agencies: real partnerships with companies

An SME, or even a very small business, does not have the same expectations, and does not have the same travel budget, as a national, European or international company. The travel agency market has been reshaped and concentrated, with two major integrated groups around which a dozen or so operators revolve. The global heavyweights in business travel management are Carlson Wagonlit Travel (CWT) and American Express Voyages (AEV). These two majors are characterised by their strong presence, both nationally and internationally, and have 'platforms' (specialised call centres) and 'implants' (branch offices on customer premises). Together with BCD Travel, another player in this sector, these networks help leading companies to extend their travel programmes beyond national borders, sometimes to forty or more countries. "The trend is driven by a shared desire among companies to achieve a level of global consistency in services, rates and information systems data," says BCD Travel. One of their specialities is consolidating a travel programme. Consolidation means concentrating the number of suppliers and standardising travel policy, processes and tools at regional or global level," explains Christophe Renard, Director of the CWT Travel Management Institute. By working closely with their travel agency, as well as with their management, travel managers are able to articulate their policy more effectively, as well as reinforcing compliance with the rules. This translates into lower costs, greater security and improved well-being for travellers." CWT's services and solutions are structured into four lines: traveller services and transaction, programme optimisation, security, meetings and events.

Without ranking them in terms of volume handled, these behemoths, whose business model remains mainly based on off-line activities - despite the irresistible rise of the Internet in their operations - are followed by traditional players as well as others operating 'online' or on-line. Egencia falls into the latter category. Since its creation, this player has taken the gamble of developing its own technology. "Our technology platform is at the heart of the system, as all order flows converge on it. The travel consultants use it to route the orders they generate, whether they are placed in the traditional way or by customers online. All flows are consistent and coherent, optimising the quality of service provided and productivity in order processing," says Christophe Pingard, Senior Vice President, Director Europe at Egencia. On this platform, customers can find all their orders. And they can do this regardless of whether they have booked online or offline. This in-house technology is of interest to SMEs as well as large groups. "Egencia can select and present relevant data at a global level; this allows us to generate reporting reports with data and analysis. Available online, these reports provide regular updates on costs and also on compliance with the travel policy by employees", continues Christophe Pingard.

For its part, HRG France combines a technological tool with a high-performance fare database. More specifically, its i-suite, an all-in-one technological tool, enables reservations to be made and integrated into the company's travel policy. It then generates the statistics needed for management control. The global pricing desk, a special department made up of around twenty highly experienced ticket specialists, is tasked with finding fares that are even cheaper than those negotiated by companies directly with the airlines.

Voluntary networks - notably Sélectour, Tourcom, Afat and Manor - form another category of players. The strong points of these local agencies are the highly personalised nature of their offers and access to price bases negotiated by the network. In terms of size, they are radically different from the behemoths. Companies have realised that it's better to be a large customer in a small branch than a small customer in a large branch," says Patrick Loison, Chairman of Tourcom Affaires. We have just set up an airline portal, which gives access to stocks of seats sold by 170 charter airlines at rates negotiated with many scheduled airlines. Although we don't have any agreements with low-cost airlines, Tourcom agencies can nevertheless sell them like other airlines, thanks to a fare comparison tool - Speed Fare - which includes the entire low-cost offer. In the coming months, we will be offering 24-hour customer assistance.

Tailor-made packages

So there's no in-house technology here, but rather agreements with software suppliers that enable us to keep pace with developments in the business travel market. "Our members have built up strong positions in the SME market, with annual business travel budgets of around €300,000. But also in the market for large national accounts, which sometimes split their travel budget between several agencies. Today, only the very large international accounts market remains the preserve of the integrated networks", adds Patrick Loison. These human-scale agencies are also appreciated by national and international public bodies. For example, the OECD (Organisation for Economic Co-operation and Development), which is used to dealing with global majors, has issued a call for tenders to some fifteen business travel agencies, and is now treating its agencies in the Sélectour network. "Whether travel orders are placed online or offline, we try to ensure that they are handled by the same person. For example, for the OECD, a contract we won in 2008, a pool of six people is dedicated to this international organisation. This team takes full responsibility for all stages of the order: quotations, reservations, ticketing, invoicing and after-sales follow-up", explains Gérard Luret, Business Manager at Sélectour Bleu Voyages in Lyon.

Even within these national voluntary networks, there may be a partnership with another global network. Our partnership with Radius, a voluntary network of American origin", explains Philippe Quillien, Director of Sélectour's business travel branch, "enables our members to respond to invitations to tender from international private or public companies, whose head offices are not necessarily located in France. In 2007, Sélectour acquired a stake in Radius, which is also a cooperative.

Technological solutions keep pace with the latest developments in voluntary networks. "Since mid-2008, we have integrated Etap on line's Ulysse and Dimo gestion's Notilus software into our online booking tool. Focusing on mission orders and expense reports, these software packages meet our customers' needs. In the coming months, we will be offering them a specific tracking solution, enabling them to locate their travellers around the world very quickly", explains Philippe Quillien.

Certified quality of service

In recent months, American Express has set up a network of partner travel agencies to offer a local service to SMEs and SMIs with business travel budgets of less than €250,000 a year. Focusing on this target, Avexia Voyages, which has eleven agencies across France, has signed a seven-year licence agreement with American Express. Christian Mounier, Network Director of Avexia Voyages, points out that "each customer is attached to one sales outlet and one outlet alone, and this regional and local proximity also enhances the personalisation of the service".

Part of tour operator Fram, Fram Affaires has a number of major references in the public sector, including the CNRS. Fram Tr@vel Pro is a web-based business travel management tool. "While serving our customers, this technology preserves the human relationship and expertise of our business advisers," says Fram Affaires.

In a society where competition is increasingly fierce, exacerbated by a gloomy economic climate, business travel agencies are racing for quality. It is essentially on this criterion that the difference is made from one player to another. To lend credibility to their approach, these same agencies can, for example, bank on certification. "Qualified by Qualicert for the quality of their services, the agencies in the Club ffaires represented 90 licences and more sales outlets at the beginning of 2008. Five new licences have recently joined the Club, which is set to continue growing over the next few years," concludes Philippe Quillien.

Selection criteria

However, for companies of all sizes, and regardless of the size of their business travel budget, the choice of a travel agency is generally made following a call for tenders. Once the proposals have been obtained, the selection process can be based on a number of key criteria.

Anne-Laure Gogeon, an expert at Epsa, outlines the main criteria: "The organisation and teams proposed by the travel agency to meet the company's needs, as well as the configuration of the service: hours, dedicated or semi-dedicated team, the agency's commitment to offering the best rates and its responsiveness to travellers' requests, the ability to interface and experience of interfacing with the major market solutions in terms of the lodged card, the mission order management tool, the online booking tool or self booking tool, the dematerialisation of invoices, the reporting provided (completeness and access to data), and the support provided by the account manager." Not forgetting the total cost of the services. It's important not to focus solely on transaction costs, but on the total cost estimated according to the scope of expenditure. "In all cases, the choice will be made on the basis of the relationship between cost and quality of service, with weightings for these two criteria specific to each company, depending on whether it chooses to focus on cost or quality of service," continues Anne-Laure Gogeon.

Mission : Cost reduction

In terms of remuneration, the world of travel agencies has recently undergone a profound transformation. Since 2005, most airlines, including Air France, have abolished the commissions paid to the 5,000 or so French travel agencies on the sale of airline tickets. This development concerns almost the whole of Europe, following the example of the United States. Subsequently, the SNCF also reduced the commission paid to agencies on the sale of train tickets. As a result, travel agencies are now charging their customers a handling fee.

But this is not the only area of remuneration. In fact, rather than simply taking charge of booking air and ground services, the mission of business travel agencies covers the inventory of requirements right through to the issuing of invoices and their integration into the accounting data. At a time when companies are tightening the budgets allocated to business travel, they want to involve their travel agency in this process. "Companies are mandating travel agencies to reduce the costs associated with business travel", emphasises Régis Chambert, Managing Director of American Express Business Travel. The trend varies according to the profile and size of the company. "In terms of remuneration, a client such as the OECD has moved away from the classic transaction fee or transaction cost, and from the service agreement to a transaction fee covering all expenses, with a variable component based on the achievement of qualitative objectives. For example, response times or savings achieved", concludes Gérard Luret.

There's no doubt about it: the relationship between companies and business travel agencies is developing over time into a win-win situation.