How to procure a travel management service

A GUIDE TO procuring a travel management service

A handy guide from

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PreparationResearchKey things to considerCommercial modelsSLAsNew Distribution Capability (NDC)Professional licensesPayment mechanismsVAT recoveryProcurement processTender/Request for Proposal (RFP) BenchmarkingPresentationsProduct demonstrationsSite visitsContract negotiation


A HANDY GUIDE

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Travel is an emotive subject. Whether you’re introducing a new travel management service for the first time or planning on changing your incumbent provider, people from every corner of your organisation will have an opinion on the matter. When you throw in the potential cost and time implications of making the wrong decision, there are a whole a host of reasons why deciding on a travel management provider shouldn’t be taken lightly.

In this detailed guide, we will walk through how to prepare for your procurement, how to find prospective suppliers, evaluate them, make a final decision, and then purchase the service in a way that protects your organisation.

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Preparation

Before you look at potential travel management companies, services and systems, it is vital to thoroughly define your needs and what the service provider you select should be able to do for you.To do this, you need to engage your stakeholders: the people who will be using the service, or who depend on outputs from the service (such as reports and invoices) and who will therefore be affected by the change. It’s a great idea to assemble a team of stakeholders who will be involved throughout the process, from early preparation, Request for Proposal (RFP) development and subsequent responses, and finally to meeting potential suppliers. This ensures you have buy-in from users and stakeholders to select a service, and service provider, that’s truly reflective of your requirements.

Engage your stakeholders




Preparation

When curating ideas and requirements, try and keep them specified as goals, objectives and outcomes, rather than nailing down specific requirements, otherwise you risk stifling supplier innovation. Also, try and keep an open mind; ask suppliers to suggest what they would do. Here’s an example:

Good BadTell us what strategies you would recommend to reduce our hotel spend.

Please confirm that you will implement contract rates at a maximum of two hotels near to our key locations in order to drive savings.

It’s also worth breaking up your list into “must haves” and “nice to haves”. When doing this, be careful to make sure that what goes into “must haves” is actually feasible, e.g. the technology exists, or the objective is achievable. For example, a “must have” of “deliver all services at no cost” is likely to result in no suppliers bidding for your business.




Key questions for debate

Q. Should we have an objective to drive online adoption? A. Driving online adoption reduces your travel management costs by attracting lower fees for bookings made online through an online booking tool, rather than higher fees for making offline bookings over the phone or by email.

Q. Do we need to review our business travel policy before we engage suppliers?A. Often, travel policies are dusty documents that were written ages ago and that no one has looked at since. If that’s the case, it’s probably worth dusting it off and ensuring it’s still fit for purpose before you get going with your procurement. Your travel policy will be at the heart of your travel programme, so it’s not a great idea to make huge changes to it right after rolling out a new travel management service.

Before you get into a discussion with any suppliers, you need to be clear on some key points within your organisation. Below you’ll find ideas as to the right kind of questions to ask, as well as the reasons why you should be seeking these answers.




Key questions for debate

Q. Do we have detailed travel data available regarding our current travel spend?A. You need to share as much data as you can with prospective suppliers, in order to get the best advice and best pricing from them. If you don’t have any data, prospective suppliers are likely to price defensively to ensure their worst case scenario is covered (e.g. you only book low-cost carriers, and budget hotels from which the revenue stream for the travel provider is negligible and therefore your fees will be higher). If you’re in this position, it’s worth ensuring there is a break clause in your contract, such that you can renegotiate prices based on actual data once you’ve been working with your chosen supplier for 12 months.

Q. Are we trying to reduce our core travel & hotel spend, and if so by how much?A. Not every organisation is out to slash their travel & hotel spend! Some organisations appoint a travel management company to ensure that their staff have great service at their fingertips, or are properly cared for and secure whilst travelling the globe on business. But if you are looking to reduce costs, it’s good to have an idea of what success would look like to you.

Q. If we’re out to reduce cost, what are we prepared to compromise on?A. Travel management companies don’t have a magic wand with which to conjure away your travel spend! Serious cost reduction inevitably means compromises have to be made, so it’s worth thinking about what would be acceptable and what wouldn’t. Switch from business class to economy on flights? Reduce your per-night cap on hotel spend? Drive online booking (which reduces cost through visual guilt)? Tighten policy constraints? Introduce pre-trip approval for bookings over a certain amount?




Research

Naturally, a great way to find potential suppliers is to search online. Try searching for questions that relate to your objectives. For example, if you have set an objective of reducing your travel spend, search for “how can I reduce business travel spend”. This will help you find useful articles that are ideally suited to your organisation’s key interests.

There are a number of business travel publications that are worth getting your hands on and reading through. Potential suppliers may advertise or feature in articles within them. It’s also a great way to find out all about the latest topics under debate, as well as changes that are coming in the industry.

Buying Business Travel

The Business Travel Magazine

For a whistle-stop tour of travel management providers, head to the Business Travel Show in London, held in February each year. The show really is a who’s who in the business travel industry, with all major travel management companies and travel suppliers in attendance. It’s a great way of getting a feel for providers and helping you assemble your shortlist.

If you have questions, or want to bounce ideas off industry experts, then there are various very active LinkedIn groups in which you can start a discussion. Here are some of the best to search for:

ACTE Global

Buying Business Travel

Corporate / Enterprise Travel Management

Institute of Travel & Meetings

The Business Travel Club


http://buyingbusinesstravel.com

http://www.thebusinesstravelmag.com

http://businesstravelshow.com

https://www.linkedin.com/groups?gid=789767

https://www.linkedin.com/groups?home=&gid=3209937

https://www.linkedin.com/groups/Corporate-Enterprise-Travel-Management-2819981?gid=2819981

https://www.linkedin.com/groups/Corporate-Enterprise-Travel-Management-2819981?gid=2819981

https://www.linkedin.com/groups?home=&gid=1596487

https://www.linkedin.com/groups?gid=2362293



Research

Through your research you should be aiming to nail down your requirements, goals and objectives such that you can build them into your RFP. In addition, you should be beginning to build a shortlist of potential suppliers whom you intend to invite to participate.

Tips on assembling a shortlist• Keep your “must have” list of requirements in the forefront

of your mind when considering a supplier for your shortlist. You’re wasting their time and yours inviting a supplier that can’t deliver your essentials.

• Size isn’t everything. Don’t be fooled by claims that any particular supplier has huge buying power that they can leverage on your behalf, travel management doesn’t work like that.

• Content is king when it comes to reducing your core travel cost, so make sure every supplier on your shortlist taps into the widest array of travel content possible - including all of the big online travel services, such as Booking.com and Laterooms.com.

• If you have contract fares with suppliers (airlines, hotels, etc.), or relationships with certain suppliers (like your favourite hotels) that you want to maintain them, make sure your shortlisted suppliers can support them.

• Technology is crucial in travel management. From booking and fare quoting engines, to billing systems and preparation of management information, technology will play a critical role in the success (or failure!) of your travel management service. Make sure your suppliers have it, use it, understand it, and believe in it.

• Check out their track record. Ask them for case studies; even better, ask them for references to whom you can actually speak. Ask for opinions and experiences on LinkedIn. Google the company name and see what comes up. Check out their Twitter stream to see if there are mentions from customers. Often references are the last thing that people check in a procurement process, but really they should be the first, to make sure that you get the right people on your shortlist at the outset.




Key things to consider

COMMERCIAL MODELS

One thing that is often overlooked in the early stages of selecting a TMC is the commercial model the supplier uses. It’s a vital consideration that can have a major impact both on what you pay and the service you receive as a result. It’s crucial that you spend time understanding TMCs’ commercial models inside out before making a final decision. To help you kick things off, you can find the three principal models explained below.

Transaction feesA transaction fee model is where the client pays a small transaction fee for each booking they make. Fees may also be levied on other transactions, such as cancelling or amending a booking. There is usually a difference in the fee level between online and offline transactions to reflect the lower use of resource in the former. Indeed, some travel management companies are now even

offering zero fees for online transactions.

The transaction fee model is now by far the most popular commercial model for travel management because it’s simple, transparent and accurately reflects the effort invested by the supplier in the service.

Commission rebatesSometimes a transaction fee model is combined with a commission rebate model, which essentially results in higher transaction fees being levied by the supplier in return for commissions received from suppliers being returned to the customer.

This hybrid model is derived from purchasing best practice, whereby the margin earned by a supplier should reflect the effort involved and be a fixed margin per transaction.





However, commission rebate models are declining in popularity due to the following:

1 There is no guarantee that you’ll ever get a penny in rebate

TMCs will tell you, “The amount returned depends on what you choose to book - it’s out of our control!” And they’ve got a point. If you choose to book Premier Inn all the time you will get nothing in rebate. In other words, the commercial model underpinning rebate-model travel contracts is dependent upon a figure that may well be zero and that the customer has no guarantee of and very little control over. It’s a high-risk gamble.

2 They are totally un-auditable

The travel industry is a complicated mesh of millions of suppliers, distribution networks, brands and people, and the revenue landscape is just as complicated. Some rates are commissionable, some are not.

Some are dependent on the booking channel whilst others are limited to how they bill. Some require the TMC to collect commission by hand, whilst others lack transparency on what happens to any commission. So when is it accounted for and what happens if the TMC just don’t bother to collect it?

The simple fact is it’s difficult to audit and few people ever bother, which increases the risk factor even more.

3 It allows the TMC to take the pressure off the supply chain

Put yourself in the shoes of the TMC - under the rebate model, their revenue is guaranteed; it’s the customer’s rebate that is up for debate. The TMC has no contractual obligation to pass on any rebate revenue back, so are they really going to bother hunting down that overdue commission payment from a hotel on the other side of the world?





There is plenty of revenue that the supply chain would quite happily part with if only they were put under more pressure to do so.

But many TMCs just don’t bother asking because the commission rebate model means it’s not worth their while. After all, it will literally cost them to get the revenue, only to hand it straight back to the customer.

Under the rebate model, the TMC improves its revenue by minimising the effort it puts into commission enhancement and collection. And that’s not good news for the customer.

The key underlying message here is that travel supply chain revenue is a risk in itself. Given a chunk of travel spend, you simply can’t predict what the resulting supply chain revenue will be with any degree of accuracy. That makes it a risk which scales with your travel budget.

The key question you should be asking is: who takes that risk? In a rebate model the customer takes it; conversely

in a retention model - where the TMC keeps the supply chain revenue in exchange for much lower transaction fees - the TMC takes the risk. Given that the TMC has a greater (although not complete) control over that risk, it makes sense to leave the risk with them.

Management feesA management fee model involves the client paying the travel management company a fixed fee per annum (normally payable quarterly), with all supplier commissions being returned to the client such that the TMC makes a fixed margin for the delivery of the services. The fee is typically calculated by open-book analysis of the TMC’s costs for delivering the services plus a profit margin.

However, management fees are rapidly falling out of fashion due to their inflexible nature: the cost doesn’t flex with travel volumes, and it’s difficult to attribute the cost to budget holders.





SERVICE LEVEL AGREEMENTIt’s an old adage that ‘what gets measured gets done’, so, at tender or contract negotiation stage, a lot of effort is put into devising performance measures to define the customer service your chosen travel management company will provide. But how often after implementation are those targets revisited and discussed? And do you know that your travel management company can even measure what they’ve signed up to?

Keep it simpleThere isn’t much point in having 5 pages of service level agreements (SLAs) and key performance indicators (KPIs) that no one really cares about. It’s far better to have a one-page, concise and clear document, which is referred to at every review meeting.

Focus on what’s importantWhat will your travellers and bookers really care about? Focus on what matters to your employees. Ask them for their thoughts before you put the document together.

Make sure you can measure it and hold your TMC to account!It’s too easy for travel management companies to fudge measuring customer service. Here are 3 frequently-used standard SLAs, how to measure them and 5 traps to avoid.

1 Phone response times

A realistic expectation here is around 20 seconds. Make sure your TMC has a phone system that enables it to measure the service every day for your dedicated number.





TMC trap 1 - Measuring across the whole businessDo you really care how your TMC answers the phone to other customers? Surely it’s only your account you care about? If you are a sizeable account, insist on a dedicated line and make sure your SLA performance is about that number only!

TMC trap 2 - Measuring this quarterlyWondering why the SLA looks fine but travellers complain they can’t get through? Perhaps the reservations manager made 1,000 very short calls on her mobile the night before the figures were published. Miraculously they were all answered and the SLA looks fine for the quarter!

2 Booking completion times

How long does it take for a booking to be completed? As a guide, 2 hours is fine for most bookings, with 4 hours for

long haul/multi sector flights. Can your TMC measure this for each of your bookings? You should require your TMC to be able to measure the completion time for every single one of your bookings made at any time, on any day.

Many TMCs manually spot check a sample of bookings over a quarter to arrive at this figure, but that’s a sample audit and is open to error. Your TMC needs to have an automated SLA reporting system, which can be varied to meet your specific response time requirements. Ask how your TMC measures bookings made by phone as well as email.

TMC Trap 3 - Giving an SLA on first responseIt’s not difficult to respond to an email or phone call - perhaps even with an automated message, which, unsurprisingly, gives a 100% response rate!





3 Complaints as a percentage of bookings

You want your account to be noise free. You don’t want to be fielding lots of complaints from your travellers. So make your TMC commit to a percentage of complaints vs. bookings. A figure around 0.03% is a good benchmark, and your TMC should be giving you a similar standard of service. You also want to be sure that your TMC resolves complaints within a reasonable timescale.

TMC Trap 4 - Logging a complaint but with no action or follow upAsk for copies of the complaints at your review meeting, with details of the follow up action for each one. Hopefully, if you pick the right TMC, reviewing these won’t take you all day! Ask for a copy of your TMC’s complaints policy and check if they have a system that accurately reflects it. Ask them how they record complaints, how they track when a complaint is going out of service level and how resolutions are picked up?

If your TMC is ISO 9001 compliant, ask how their complaint system ties in with their continuous improvement cycle.

TMC Trap 5 - Committing to a complaint ‘response’ time not a ‘resolution’ timeIt’s easy to ‘respond’ but much harder to resolve a complaint.

Challenge your TMCToo many times, companies sign up to service measures, which they know they can’t track, safe in the knowledge that the customer will not ask for evidence. Don’t just get the signature, ask for evidence of how service is measured and reported before you commit.





NDC - NEW DISTRIBUTION CAPABILITYAnyone who sells airline tickets today - from travel web sites, travel agents and travel management companies to airlines themselves - does so via a Global Distribution System (GDS). There are only a handful of GDS’s in the world and if you’ve not already bumped into them during your research, no doubt you will. The major ones are called Galileo, Apollo, Worldspan, Sabre and Amadeus.

However, airlines, desperate to reduce their distribution costs and gain more insight into their customers are pushing for radical reform through the creation of New Distribution Capability (NDC). NDC effectively enables an airline to sell tickets directly to retailers, cutting out the GDS and their associated distribution costs.

But this change poses a significant challenge and threat to the traditional world of travel management, because the vast majority of traditional TMCs have built their entire business around the GDS. Everything, from their retailing

systems to accounting, reporting and traveller profile systems are based upon the GDS.

In order to remain relevant and competitive, the traditional TMC is faced with the monolithic challenge of reengineering entire business processes and the technology that underpins them to accommodate this seismic shift in the distribution landscape.

The key message for those tasked with procuring a travel provider over the next few years is this: if you appoint a TMC whose only source of airline content is the GDS (which right now is almost every TMC in the UK top 50), you will be affected by NDC, and it is very unlikely to be positive for your travel programme. So make sure you ask your prospective TMC about New Distribution Capability, their understanding of it and their plans to address it.

Key points• Over the next few years, IATA’s New

Distribution Capability will become more and more prevalent in the world of airline





distribution hence it’s imperative that you choose a supplier today that is in a position to support NDC as it comes on stream.

• Traditional folk in the travel industry will point out that airlines today typically have “full content agreements” with the GDS, which in theory means all fares published by an airline are available in the GDS channel. But this may not continue in the NDC era. Airlines may either limit the fares published in the GDS to the more lucrative fully flexible classes thus reducing access to content, and/or levy distribution fees on top of the base fares thus making it more expensive to buy through the GDS. The latter is already happening, albeit on a limited scale.

• Some TMCs are ready for the NDC era, the majority are not. If your preference is for one of the latter you should carefully consider

the impact NDC is likely to have on your travel program during the period you intend to contract for.

• Explicitly ask potential suppliers to explain how they intend to provide you with direct access to NDC content.

• Require potential suppliers to confirm that bookings will be made via NDC connections rather than via a GDS where it is commercially advantageous to do so (i.e. the ticket price is cheaper, or the product includes more flexibility or soft benefits when booked via NDC).

• Require potential suppliers to confirm what distribution charges levied by airlines and/or distribution channels will be passed on to you, specifying the airlines and circumstances to which the costs will apply.





PROFESSIONAL LICENSESYour organisation is likely to have a standard pre-qualification (PQQ) questionnaire for potential suppliers. This document will typically cover legal and regulatory items (such as bankruptcy, criminal records etc), together with your organisation’s internal policies (such as financial standing and track record).

However, it’s well worth checking at PQQ stage that suppliers hold suitable professional travel licenses, to ensure that you eliminate unsuitable suppliers at the earliest opportunity.

A mandatory requirement should be an IATA license (which empowers the supplier to issue air tickets), an ATOL license (which provides protection against airline failure), and, if booking UK rail tickets is a requirement of your project, an RSP license (which empowers the supplier to issue UK rail tickets).

Hint: To deliver travel management services, suppliers don’t need an ABTA license (which is required for packaging tours and holidays into a single price). It is a fatal mistake to make an ABTA license a mandatory requirement because you’ll automatically eliminate all leading travel management companies, and limit your procurement to leisure travel agents who have little to no experience in corporate travel management.

If you can’t squeeze this into your PQQ, make sure you include it in your RFP.





PAYMENT MECHANISMS

Credit cardsCredit cards are simple and universally accepted, but if your spend is large they can become problematic from a data perspective.

Pros ConsSome credit card companies provide points and prizes based on the amount of spend that you put through your account

Your credit card account is portable - you can take it with you if you switch providers, or even use it with multiple providers at the same time

Paying by credit card can sometimes incur merchant fees, which could otherwise be avoided

Data will be next to non-existent beyond the merchant name, and linking it with travel data provided by your travel management company will be virtually impossible

In the UK, credit card statements cannot be used for VAT purposes which means you still need to collect original VAT invoices for every transaction that appears on your credit card statement





Lodge cardsA lodge card is a credit card which is specifically designed purely for business travel expenditure. There is typically one credit card number which is “lodged” with your travel management provider, and to which all expenditure is charged. Whilst they are relatively simple and universally accepted (because they are effectively just a clever credit card), they can become problematic from a data perspective if your spend is large.

Pros ConsSome lodge card companies provide points and prizes based on the amount of spend that you put through your account

Your lodge card account is portable - you can take it with you if you switch providers, or even use it with multiple providers at the same time

Paying by lodge card can sometimes incur merchant fees which could be otherwise avoided

Data will not be perfect as it is dependent on consolidating data from many different sources

In the UK, lodge card statements cannot be used for VAT purposes which means you still need to collect original VAT invoices for every transaction that appears on your lodge card statement

You can come unstuck if you have a query about a charge as it’s difficult for the TMC to investigate





Credit accountMany travel management companies will offer a credit account directly with them. Because these accounts are built into the TMC’s systems and processes, they typically offer by far the highest data quality - in fact, the data quality should be perfect.

Pros ConsA credit account with your travel management company should provide perfect data

You will be able to avoid almost all merchant fees

You’ve only got one relationship to manage - there’s no blame game between your payment provider and your TMC when charges are in query, or data is not acceptable

Terms and credit limits may not be as good as those offered by credit and lodge card providers

Some travel management companies won’t allow all travel to be charged to your account





VAT RECOVERYVAT can be a complicated subject in travel, but by carefully choosing the right travel management partner, you shouldn’t ever have to worry about it. With some suppliers you can choose to have a credit account for all of your travel purchases, which they will consolidate into a single document, from which you can recover all the VAT you are eligible to. Some important points to look out for:

• Be careful when comparing prices. For example, a £100 pre-pay rate on Expedia is more expensive than a £110 post-pay rate from a travel management company. Why? Because you should be able to claim VAT back on the latter, but you can’t on the former.

• The VAT charged on transaction fees made by the travel management company should follow the service for which the fee is being charged. For example, if the service is a UK hotel (which is a standard-rate VAT supply) then any associated transaction fees should have standard rate VAT applied to them. Whereas if the service is a UK train (which is a zero-rate VAT supply) then any associated transaction fees should have zero-rate VAT applied to them.




Procurement process

TENDER/REQUEST FOR PROPOSALIssuing a tender or RFP isn’t something you must do when choosing a TMC, but it certainly helps to bring structure to the process and keep you focussed on your objectives. Whether you’re following a formal tender process or just want to engage with suppliers informally, bear the following points in mind to keep things running smoothly.

1 Assign one person to manage the process from start to finish to keep the project on track. If the person responsible changes part way through, it can lead to confusion and duplication of work. This is especially important if using a third party consultant – make sure you have the same consultant or project team for the duration.

2 Keep it short and simple, and only ask questions that will help you decide which supplier(s) to appoint. There are lots of template RFPs available; if you are using one, don’t just copy them word for word, pick the questions that are relevant to your organisation

and make sure you add the ones that aren’t already there. You won’t be able to make an informed decision if you’re asking questions that aren’t relevant to your business travel objectives, especially if the template you’re using is out of date.

3 Include your mandatory requirements within your RFP so that the responses you receive are from suppliers who stand a real chance of winning the business. Giving suppliers the information they need to qualify the opportunity and make an informed bid/no bid decision saves all parties a lot of time and money. It’s possible that you’ll have fewer responses to evaluate, but every response should be a genuine contender.

4 Invite incumbents, strong contenders and a few wild cards. Some procurement departments only send their RFPs to suppliers they’ve worked with previously or the biggest names in the industry. By doing so you may miss the opportunity to bring in new innovations.




Procurement process

5 Enlighten the bidders with as much information as possible; what you currently do, your objectives, your business travel profile and transactional breakdown. The more information you provide, the more accurate and innovative their bids will be.

6 Give clear instructions on how you want bidders to respond. If all suppliers respond in the same format, it will make it easier for you to evaluate and quickly draw fair comparisons.

7 Hold a bidders conference before the tender is due. This is a great opportunity to bring your requirements to life and address any areas that require further clarification. Use this time to make sure suppliers really get where you’re coming from and understand what you want the successful supplier to deliver. The cost of holding a teleconference is minimal, but it allows suppliers to ask questions anonymously and means they hear the same answers at the same time.

8 Allow plenty of time for suppliers to respond. Suppliers are often working on multiple bids at any one time and therefore have to prioritise and distribute workload to meet deadlines. Try to give suppliers 3 to 4 weeks to respond to your RFP, making sure you extend the deadline to accommodate any crucial or game-changing clarifications. If you give suppliers ample time to respond, you’re more likely to receive high quality, well-thought-out responses.




Procurement process

BenchmarkingMany organisations attempt to benchmark travel companies as part of their procurement process. However, the techniques used invariably lead to dubious results that can undermine your entire procurement exercise.

If you’re spending lots of money on a regular basis, say, stationery, benchmarking an array of suppliers may be a valuable exercise. You present your shortlist of suppliers with an array of uniform products (a biro is a biro, a stapler is a stapler) and the suppliers provide you with their best prices. Once you select a supplier you can reasonably expect them to honour the prices quoted during the benchmark. You might even contract them to do so.

With travel, it just doesn’t work like that. Prices change all the time. Availability changes all the time. And there is no guarantee that any of the quoted prices you see in a benchmarking exercise will ever be available for you to purchase in the future. Worse still, you don’t even know if the prices are real.

So what should you do?

Firstly understand that having great prices is only half the story. There’s no point having the best prices in the world if you can’t control which ones your staff can and can’t book.

Your biggest savings are going to come from changing buyer behaviour, no matter what the prices are. So focus on figuring out which supplier you think has the best strategy to drive behavioural change, and the software needed to deliver it, such as a rock-solid travel policy system.




Procurement process

Secondly, look at where suppliers are sourcing content from, as huge reductions in core travel spend can be made by buying through channels such as booking.com and laterooms.com, rather than the traditional Global Distribution Systems. Ask them to confirm which travel distribution channels are providing content, and make sure all the big online travel discounters and low cost carriers are on the list.

Finally, if you really must price benchmark, do it yourself. Insist that every potential travel management company provides you with a login to their online booking tool and conduct the price benchmark using your own staff, in your own time. That way you can ensure you’re comparing real prices on a truly level playing field.




Procurement process

PresentationsAfter the RFP stage, it’s good practice to get those suppliers left in the running to come in and present their bid to your stakeholders. This gives your stakeholders an opportunity to meet with key members of the supplier’s team, and get a feel for the kind of organisation they are. It also gives you the opportunity to ask questions about the supplier’s bid, and clarify any areas you felt were not entirely clear.

Tips for presentation days• Provide each supplier with a bullet point list of the items

you want them to cover in their presentation, but allow them some flexibility to cover items they feel they want to highlight from their bid too. It’s a two-way event - they want to make sure you’ve seen and understood the unique aspects of their bid, and you want to ensure that you clarify any areas that were not clear to you in their submission.

• To ensure the presentations run smoothly, make sure you are crystal clear about what technology will be available to the suppliers:

• Can they use their own laptop computer or are you expecting them to present from your equipment?

• If they are using your equipment, what software will be available (e.g. Powerpoint, Adobe Acrobat) and what version?

• If you are expecting a system demonstration are you providing suitable wifi, or do they need to ensure they come equipped with mobile connectivity?

• If you are expecting a system demonstration via your equipment, which browser and version will be available?




Procurement process

• Afford suitable time to each presentation. Given the level of effort that both you and each supplier have already invested, cramming a presentation into 45 minutes is a risk at best, insulting at worst. A reasonable guide would be to allow 1.5 hours for each supplier, including Q & A time.

• Take a photo of the presenting team. It really helps people recall details when discussing presentations at a later stage!

• Make sure you have an agreed scoring mechanism in place, and build time in between each presentation to discuss, normalise and finalise a presentations score before moving onto the next. There is nothing worse than attempting to recall a presentation hours, or even days later.

• Once all the presentations are complete and have been individually scored, have a recap session to make sure that opinions on the scoring of earlier presentations haven’t changed in light of latter presentations.




Procurement process

Product demonstrationsComparing features across various solutions can help you understand what you’ll be able to achieve with each platform, and how these capabilities align with your goals. Here are a few questions to keep in mind as a sales rep demonstrates his or her product:

Is the demo live?

A live demo can tell you about more than just the product’s capabilities— it can show you the pace at which the product will function. If a sales rep shows you screenshots of what can be done instead of demonstrating the capabilities him or herself, it could be a sign that they’re concerned the product will freeze up or not perform accurately in the demo.

Does it cover the basics?

You’ll begin to notice differences between platforms as you continue to explore your options, but all travel management platforms should include some basic capabilities. In each demo, look for these basic features of travel management:

• A single sign-on to access all features and travel content

• Ideally a single solution (i.e. once logged in, you are not redirected to other services to complete certain functions, or book certain travel types)

• The ability to book, amend and cancel all core travel types (hotel accommodation, rail tickets, air tickets and car hire)

• Integrated profile management, which incorporates a single, universal traveller profile for each person within your organisation

• Integrated reporting with the ability to run and schedule reports for future delivery




Procurement process

Site visitsIf you have the time, paying a visit to the offices of your prospective suppliers is a big win for your procurement process. It gives you the opportunity to meet the actual people who will be working on your contract, and it gives the supplier the opportunity to present to you a much wider array of key people within their organisation that wouldn’t be feasible at the presentation stage, or earlier in the bid process.

If you want to kill two birds with one stone, you could combine the presentation stage with a site visit (i.e. get suppliers to present at their offices, rather than yours).

Ahead of a visit, communicate to the supplier any outstanding concerns you have about their bid so that they have the opportunity to address them during your visit. Also make sure to request attendance from any key staff that you’d like to be present, such as the proposed account manager and the senior management team.

Take as many of your stakeholders along as possible - after all, it is they who will be interacting most often with the operational staff you’ll meet.

Post visit, make sure you have a thorough debrief with all of your staff who attended. Get an understanding of how they feel: are they confident they can work with the team they just met? Do they have any concerns? Is the organisation compatible with yours on a cultural level? Do you feel you can strike a good working relationship with the supplier’s team, and at all levels?




Procurement process

Tips for site visits

• Treat the sites visits just as you would an interview. Just like when hiring people, your mission is to determine whether you think you can create a really successful working relationship with the supplier’s team of people.

• Ahead of the visits, assemble your stakeholders and prepare questions that are relevant for the people you are going to meet. For example, asking reservation consultants how they would handle real-world examples is a great way to get them talking (e.g. “We have a traveller stranded in the far east, it’s 2am, they need to get home, what would you do?”).

• Make sure you get to meet the actual operational team (reservation consultants and associated management) who will be looking after you. Pay particular attention to the team leader as they will be pivotal in the success of the service delivery.




Contract negotiation

Going through the legals is not the most interesting part of the process, but investing time at the outset should prevent a costly break-up further down the line.

Tips for contract negotiation

1 Define what they are actually going to do for you

Make sure you have a tight definition of the services that your supplier is going to provide. If you are contracting on your own legal terms, the standard services agreement (that the legal team has just dusted off) is unlikely to be bespoke to travel management. So make sure your agreement actually covers what you expect them to do.

2 Incorporate the service level agreement (SLA) into the contract

Many organisations spend a fair amount of time discussing service levels at the tender stage and then forget to incorporate the SLA into the legal agreement! This gives the travel management company the chance to wriggle out of delivery.

3 Agree what happens if your partner’s ownership changes

If your preferred business travel agent gets bought out by another supplier (this happens quite a lot in the business travel industry), the service could be very different. It could even be the supplier you dismissed at the first stage of your tender! So make sure that your contract includes a ‘change of control’ clause enabling you to terminate if your supplier’s ownership changes.




Contract negotiation

4 Look at the termination clauses carefully

Can you terminate easily if things are not going well? What if they fail to deliver at all? You need to be able to move on if it’s not working and the mediation has failed. Look at how easily your travel management company can get out as well - they may be able to terminate on three months’ notice at any time, which is the last thing you want after all your hard work in appointing them.

5 Watch out for crafty price increase clauses

If you’ve contracted for a set period of time, your travel management company should commit to that price for the entire contract. Make sure they haven’t slipped an RPI (Retail Price Increase) clause into the small print.




What’s next?

We hope you’ve enjoyed your guide to procuring a travel management service.

Next up in our series of travel management guides is our equally comprehensive guide to

implementing a travel management service; in it you’ll find expert, spin-free advice on how to

get things up and running efficiently and painlessly once you’ve selected your TMC.

You may also be interested in our guide to implementing an online booking tool, which details

the most effective ways to ensure your people get on board with your new online booking tool

from the outset.




What’s next?

Industry-leading blogsFrom useful, spin-free advice and guidance on travel management, to top travel tips for business travellers and all the latest from Click HQ, our blogs are perfect for anyone interested in the finer points of travel management, as well as the wider world of business travel.

Case studies Our detailed case studies will give you a great insight into what our customers think of working with Click Travel and the results they’ve achieved with us. Covering clients across various industry sectors, you can learn why Red Bull, RNIB, TalkTalk, Whitbread, Jamie’s Italian and many others came on board with Click Travel.

Comprehensive guides These complimentary, comprehensive guides give you exclusive insider insight into specific areas of travel management. From procurement practice to implementation information, our guides will have you in the know in no time.


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