TMCs look ahead

Travel management companies have plenty to think about as the business travel industry eases into a new era. As in previous editions of this annual report, we surveyed the TMCs included within it for their views on recovery, growth, concerns and their current priorities.

While the ongoing coronavirus situation is clearly a concern among those that responded, the difficulty in recruiting skilled staff is almost as much of an issue. UK TMCs were also worried about wide geopolitical issues, such as the war in Ukraine.

As in previous years, we also asked TMCs how they are remunerated. There has been much focus on this during the pandemic, as many were required to carry on working while levels of business travel were depressed.

The survey showed that transaction fees remain the predominant method of remuneration, used in 87 per cent of cases. Other forms of remuneration are starting to emerge with some TMCs saying that a small proportion of their business is handled through subscription fees or a hybrid model involving some element of management fee and some transaction fee.

Responses to all our other questions can be found below.

Most TMCs are sanguine about their prospects for 2022, with most predicting lower sales for the year compared with the last pre-pandemic year. That said, more than a quarter of TMCs felt there would be a boost to sales beyond 2019 levels.

TMCs are overwhelmingly convinced that growth will come from winning new customers from other TMCs, with more than half saying this will drive their growth.

As every year, we asked our survey respondents what their business priorities would be for the current year. Understandably, winning new business was top of mind for every TMC in the survey.

The decline in business travel has clearly been largely due to the pandemic and there are lingering concerns that the acceptance of videoconferencing platforms like Zoom will permanently reduce demand for face-to-face business travel. Over the longer term, environmental sustainability is also playing on the minds of TMCs, as shown below, with more than half expecting a permanent impact on demand.

TMCs also have a range of other concerns, as shown in the chart below. Coronavirus and other pandemics was named as a key challenge by all those surveyed, while more than 90 per cent identified difficulties in recruiting skilled staff as another significant hurdle.