"Travel managers have a more strategic role to play than ever before."

Silvia Magdaleno, global travel manager and business travel expert with long experience in international management, analyzes the current situation and the changes that companies have implemented in their travel policies. The interview was conducted live by Natalia Ros during the last session of Forum Business Travel, on November 5 at the NH Príncipe de Vergara hotel.

?How is business travel behaving globally?

On the one hand, some figures speak of a global reduction of 90%, but it is highly dependent on the productive sector and countries. For example, in South America it is between 50% and 60%, while in the United States it is 80%. In Europe it is very uneven. Some have reached 90% and others have practically not stopped traveling.

What changes are being seen in the approval protocols?

In many cases it depends on whether the travel is domestic or international. In the former case they are approved by department heads or country managers, while the latter are approved by Human Resources or General Management. Other companies, for example, approve car journeys locally, but if you have to take a plane or train, the level of responsibility rises.

?How is fare contracting behaving?

There is more permissiveness in general. Companies that by policy did not allow the purchase of flexible tariffs are now resorting to them, even if they are more expensive, in order to have more leeway for possible changes or cancellations. In terms of restrictions, some companies have set a maximum number of nights away, limit the number of travelers departing together and prioritize direct flights over those requiring stopovers.

"What new suppliers have emerged to service companies in these circumstances?

For example, those that offer tools to assess the risk of contagion in certain circumstances, depending on age, gender, location, etc. Companies are concerned about knowing where their employees are at all times, and those that do not have one are implementing risk management policies. For their part, occupational risk departments are providing travel kits. In addition, travel managers receive many requests for information on where to travel to and what conditions to travel to.

"What is the situation of the companies in the aéas aéreas?

The airlines have made fares more flexible and are making a great effort to take measures to guarantee hygiene and to communicate them to the user. Given the reduction in capacity, there has been a tendency in recent months to increase prices, although not very significantly.

"And what about the hotels?

In the absence of an ISO standard, each chain establishes its own protocols and its own quality and cleanliness seals. The companies have problems, because many hotels they used to have are closed and they have to look for alternatives for their travelers. In some cases, establishments appear to be open when they are actually closed. They can be booked, but when the client arrives there, he/she is diverted to another hotel. Sometimes their location is not the most suitable. Some spaces have been converted, such as rooms that suddenly become an office or a private gym.

How are suppliers coping with structural costs in the face of such a substantial reduction in revenue?

New charges have appeared in services such as rent-a-car, where they are charging extra fees for car cleaning. Some travel agencies have started charging when employees call but don't make a reservation. This is a cost for providing information so that these intermediaries can defray part of their operating costs. In this chapter of intermediation, in addition to the classic management fee and transaction fee, a new economic model is beginning to spread: the subscription fee, a monthly subscription that helps them cover overhead costs while no transactions are made.

 

What travel managers need to consider when approaching negotiations for 2021?

The data we had will probably not be valid. It is also complex to make consumption estimates to approach negotiations. Talk to suppliers and be flexible. Regarding accommodation, it is good to be cautious and work with a fixed rate in those where we have more room nights, but it is good to add a discount on the best available rate in other establishments, something that also allows us to observe market fluctuations. It is necessary to review the agreements more frequently and analyze the data more. Don't wait a year to re-tender.

What other trends are you seeing internationally?

Some chains are extending rates from 2020 to 2021. Companies are also turning to multichannel booking directly, especially in the United States. They use the payment method to analyze the data, but they book directly for all simple trips and use the agency for the more complex ones or for the services that add the most value. In Europe it's different, because travelers tend to have more centralized payment methods, rather than individual cards.

What are your recommendations for travel managers?

According to experts, we won't see the 2019 travel volume until 2024, although it will depend a lot on the country and the needs of the company. There is more strategic work to be done now than before. If we have a little more time, it is advisable to invest it in training. The knowledge we have acquired is not entirely useful, because the situation is very uncertain. It is necessary to make an exhaustive analysis of the trips to see what they really add value. We can take advantage of this to improve processes and review the entire risk management policy.