Travel buyer Toby Guest, who is also ACTE’s country champion for the UK, talks about the latest trends and challenges in the corporate travel market
Which company do you work for and how long have been involved in travel buying?
Xchanging Procurement Services (XPS). I have been involved in global corporate travel sourcing and management for over 15 years, including previous roles as global travel manager at IBM and vice-president and executive director for global travel at Goldman Sachs. My current role as head of travel at XPS involves the strategic sourcing and travel programme management on behalf of Xchanging’s many clients who enter into outsourcing and co-sourcing agreements with us in order to benefit from our aggregated spend agreements, our significant team experience and global reach.
Explain your ACTE role and how long you have been doing it.
I am country champion for the United Kingdom. My role is to support the ACTE organisation, promote its many offerings to my peers within the industry and also actively contribute to ACTE’s many educational and development initiatives throughout the year.
What are the three biggest travel buying challenges in your market?
The best deals are only of value if compliance to policy and programme is high; therefore, the biggest challenge is often in the promotion of the benefits and subsequent tracking of an implemented programme. Within the industry itself, the continued growth in airline alliances is actively diminishing fare competitiveness, while the airlines themselves are not always ready to provide joined-up offerings despite the public image of ‘one airline family’. Finally travel policies themselves are under scrutiny with a strong argument being in favour of just having hotel rate and airline fare caps in place and travellers having freedom of how to book and who with.
What business travel trends have you noted in your market to date in 2012?
Airline fares and hotel costs have not increased to the degree forecast by many financial analysts. However, with a buyer’s focus on year-on-year cost reduction, switch-selling and compliance activity remains the largest driver for savings in the current market. We expect this to ease toward the end of 2012 and into 2013.
Is the amount of travel you are buying increasing year-on-year?
We’re seeing volume decreasing slightly in some instances, but the more significant reductions are on spend. Companies are moving to lower grade travel options (premium economy from business, 4-star hotels from 5-star for example) in an effort to contain cost.
Are your travellers’ expectations changing? For example, do they expect business class flights and a certain category or star rating of hotel?
No, my experience is that travellers are incredibly pragmatic in today’s economic climate and supportive of change on the whole - as long as quality is not sacrificed.
How easy is it to get travellers to follow travel policy – particularly with the growth in mobile technology?
As stated, this is one of the more challenging factors for travel buyers. However it depends purely on the culture of the company – many have extremely strong compliance at nearly 100%, others are more relaxed to their approach to travel policy.
What one thing would make your job easier and explain why it would make such a difference?
Complete transparency between buyer and supplier. If the RFP process could be condensed down to the buyer stating what the absolute caps are and the supplier able to propose rigid but fair pricing schedules, thousands of hours of people’s time could be saved with the same end result. The industry is unnecessarily self-protective and thrives on this veil of secrecy. But this is just my opinion.
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