Strategic Meetings Summit London, 26 September,
September 29 2022, Kimpton Fitzroy London
Friday 30 September 2022, JW Marriott Grosvenor
Ajaya Sodha, chairman of charity specialist Key Travel, reflects on his 30 years in the travel management industry – from hand-written tickets and the dawn of missionary contracts at a one-desk office in King’s Cross to becoming an international player in a niche market.
You founded Key Travel 30 or so years ago...
Yes. I registered the company in October 1980 and we opened for business within a week in King’s Cross, of all places, as a two-man band in a tiny room in a third floor building. We just had one desk and started plugging away.
What made you decide to go into travel?
I wanted to go into business and looked at various different. Not having much capital meant anything with stock was out of the question. I looked at various ideas, such as becoming an estate agents or an insurance trader. But ultimately this was the only trade industry where I had any experience. I had done a number of summer jobs in travel – I seemed to gravitate to it.
The business then was very different from how it is today. It was very much a case of licenced travel agents registered with ABTA and IATA who sold pricing that was prescribed and set by the supplier. And then there was the unlicensed trade, which was the bucket shop. That’s where we started, as a bucket shop. We were only able to buy and sell tickets at market prices.
Our very first customer was somebody from the Methodist church. He liked the service he got and he came back for more, and recommended us to others. Suddenly there was a plethora of church and charity-related customers, building up very quickly.
So it was organic growth – by word of mouth?
Absolutely, yes. It was probably the best part of 12 to 14 years before we actually decided to recruit somebody on our sales team to go out and promote us. Before then it was all word of mouth.
Life started as a bucket shop buying and selling disount tickets and then the rules were relaxed by the authorities so we were able to register ourselves as ABTA agents and subsequent to that we became an IATA-accredited agent, so we could issue our own tickets, and negotiate our own contracts with airlines.
As the business grew the airlines were very keen to come and talk to us about the kind of clients that we dealt with and the needs that they had. But in the old days if you travelled in Europe you had to stay a minimum of a Saturday night to qualify for any cheap return tickets, which our customers found very difficult – from priests who had to be back at their parishes on Sundays to preach, to the fact that as charitable organisations every extra day away meant more cost to them in terms of hotels.
We went to the airlines and said here is a client base that needs something different and they recognised that for this niche segment of the market there was a need for a special kind of contract and they drew up some rules and conditions. We managed to set up the contract and to prove that they didn’t lose any business or revenue on tickets, because we weren’t selling them off to other people who didn’t qualify for it. All the other airlines started then getting very eager to join in. We now have something like 30 airlines that support the market with these special rates.
The airlines still call them missionary contracts, predominantly I suppose because the majority of our early customers were missionary societies and churches, although there were standard charities that we were working with as well. I must say it’s really heartening to think that we were the innovator of the missionary contract. It’s something that will always stay with me as a personal achievement of great satisfaction.
And you’re still based in King’s Cross...
The London office actually shifted around. We were in Holborn for a few years, then Euston, and now we’re back in King’s Cross.
And offices abroad...
We now have five offices. Continuing on the organic path to growth we opened an office in Manchester in 1995. Then one in Brussels in 2005. It’s uncanny how the years coincide. Then on March 1, 2010, I acquired an agency in the Washington DC area in the states. And by sheer coincidence on March 1 this year I acquired an agency in Scotland, in Edinburgh.
How has your service developed over the past 30 years?
What has had a major impact on us is the fact that increasingly we’ve treated our customers as professional bodies and organisations, and they have started to become more professional in their purchasing requirements. We’ve seen a trend of specialist procurement people coming into charities, buying things in a more professional manner. That never used to exist.
When you think of charities you think of people who work through the heart, so to speak. They’re there because they’re passionate about it. If they end up saving an extra £5 on any purchases it is of significant importance.
It was also a big challenge for us to serve our customers in the same way that TMCs were beginning to do for their corporate customers – looking at things like management reporting, which we never used to do before. In fact, we were the first TMC to come out with a carbon calculator. Charities, being much more aware of their impact on the environment, were demanding that from us much earlier, compared to corporate customers. We came up with our own model much earlier than the rest of the market.
Now, of course, the big area is risk management – knowing where their people are at any given time. Charities tend to send their people to the more dangerous locations in the world. They now send them out with eyes wide open, making sure they are fully aware of the risks being taken and the areas they are going into.
We have certainly been very active in promoting our risk management tools. We also got a medical card for our travellers – it’s like a credit card that you split in two and in the middle are written their medical conditions, blood type and medication, etc. Little things like that have added up to a more quality experience for our customers.
You say charities are becoming more aware of procurement and making their buying power work better for them – do you think they are as aware as large corporates, and could they be doing more?
The trend is there, and hence why we wish to grow internationally. They are doing things better on a UK basis, far far better than before. Like anything else, they could do a little bit more, but it all depends on how high on the agenda it is when you consider all the other things that keep hitting them – the consequences of the earthquake in Japan and the tsunami for example, mean that is what they have to focus on. But procurement procedures and travel policy management will increasingly become the norm.
The other trend of course is that charities are international organisations. Many have more staff overseas than they do in the UK. And therefore all those are spending money not just on travel but on many other things. In our conversations with them they have been saying: ‘Thank you for taking us up to where we are. Now we would like to see what the solution is on a global procurement basis, if we were to try and buy travel across the world. Do we need to go to someone who has offices in every country or could a specialist TMC like you come up with innovative solutions that meet the same need?”
We are looking at our international growth and providing a 24-hour multilingual presence which will help deliver that. Fortunately for us it is a collaborative effort with our big charity clients, so we are not chasing a deadline. We are both working together because they have their own agendas to win as well within their own organisations.
Why did you choose Washington and Scotland for your most recent expansion?
Washington was due to the fact that the US is probably the largest charity market. Charities within the US have far more income than any other in the world – around 10 times that in the UK. Plus most of our customers in the UK have US bases, so it was a logical step. To a limited extent, doing business in the same language also helps.
In terms of Scotland, it was simply a really great opportunity. We had a number of Scottish clients already, but were aware that Scotland has traditionally got a more nationalistic feeling. It had been hard work trying to win Scottish customers when you are sitting in London. We had always wanted to have a presence there, and when this opportunity came along to merge with an agency that shared a number of our clients we thought, wow, what a perfect fit! It couldn’t go wrong. We now have more organisations who want to talk to us on a serious basis.
Are you still on the look-out for more expansion opportunities?
Yes. We’re going to continue to focus on the same group of clients, so the not-for-profit sector. In the UK, if something appropriate comes up we will certainly be looking at that, but also internationally. We are certainly on the expansion path.
During your 30 years in the industry, what is the biggest change you’ve seen?
Technology. It has been the driver of much more efficient working conditions. In the old days I used to sit there on the phone trying to get through to British Airways – it could take anything over an hour or two. And we had hand-written tickets. I can remember spending whole weekends just sitting in the office writing tickets by hand. Mid-day, mid-week we would be completing bookings, to make the most efficient use of time, and during the evenings and weekends we would be preparing tickets and posting them out to customers. It was a bizarre state of affairs. Technology has been the biggest single change in the industry – all for the better.
Looking ahead to the next 30 years of the industry, what changes do you expect to see?
I think I foresee fewer travel management companies around. They will be more global in the future. Part of this is borne out from the trends that I see in terms of how airlines, and IATA in particular are working, and the requirements of new travel agents and the high levels of volume that prohibit easy access into the market. What you get is a smaller number of players and the big boys buying the small boys out and growing in that way.
We may certainly see far fewer travel management companies and travel agents in the marketplace. They will reach out further across international arenas, because technology is allowing people to do that. I know some corporate clients are having all their servicing done by a single office within a TMC. You could well foresee a time when a TMC’s large customers will have one call centre somewhere in the world where all their calls will be going to. It’s interesting how that will then evolve.
Do you think this will mean a lack of service – is the loss of the personal touch inevitable?
Business travel, like anything else, will go through a phase where people will want to buy something through an online booking tool (OBT). This is something we already have, which can be used by a number of our customers. Our rail bookings, for example, are predominantly done online through our OBT. At the operational level people will be doing more and more transactions on that, but demanding and expecting somebody at the end of the phone that can deal with individual requests as well as the overall travel experience that they need. If a call centre is in Budapest, so be it. As long as they are able to deal with the traveller and their needs, they won’t mind, frankly.
Do you think that trying to do what you did 30 years ago perhaps isn’t possible these days?
I don’t think so. It’s becoming very difficult to consider somebody waking up one morning with £1700 in his pocket, as I had, and starting a travel agency. I can’t see that happening. New entrants are going to be fewer and fewer in the marketplace.