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Travel Procurement 411

Travel Procurement 411. NBTA CCTE Course Handouts, Part 2. August 23 rd , 2009 San Diego. Presented by Scott Gillespie. (O) +1 440 248 4111 (Eastern Time Zone) Scott.gillespie2008@gmail.com Gillespie’s Guide to Travel Procurement http://gillespie411.wordpress.com LinkedIn Profile

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Travel Procurement 411

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  1. Travel Procurement 411 NBTA CCTE Course Handouts, Part 2 August 23rd, 2009 San Diego

  2. Presented by Scott Gillespie (O) +1 440 248 4111 (Eastern Time Zone) Scott.gillespie2008@gmail.com Gillespie’s Guide to Travel Procurement http://gillespie411.wordpress.com LinkedIn Profile http://www.linkedin.com/in/scottgillespie2008

  3. key success factors Travel Agency Staffing Stakeholder Management Travel Policy Analytics

  4. is critical your travel management company Shop Book Travel Report Advise

  5. TMC KSFs expertise fits your needs quality accurate, timely, helpful availability response time, confirmations flexibility booking, expense tools data accurate, timely, accessible consulting effective

  6. travel policy key elements of a Shop Book Travel Claim Reimb.

  7. Travel Policy KSFs consequences control card, agency, suppliers quality cabins, beds, cars time cabins, connections; flight windows cost guides or per diems, lowest logical fares claims receipts, non-reimbursables

  8. How much share can you really move?

  9. know your true strength

  10. Travel Policy Discussion • Which policy elements matter most to suppliers? • How does a new supplier gauge the real strength of your travel policy? • How well does your senior management understand your travel policy? • What are clever ways they support it?

  11. intimidating exception approval path

  12. Credit Card Procurement Finance Expense Reporting Travel Manager Business Analyst Policy and Communication Transient Hotels Travel Agency Airlines Rental Cars Groups and Meetings Self Booking

  13. lots of stakeholders Senior Management Line Managers Procurement Finance HR Travelers Airlines Hotels Rental Cars, Limos Payment Providers GDSs and SBTs Travel Agencies Data Suppliers

  14. Travel Manager KSFs relationship and project management skills

  15. Supplier Relationship Discussion • How do you know if you have a good relationship? • What’s the difference between an OK and a great relationship? • How can you introduce the FU factor into a key supplier relationship?

  16. travel data

  17. right ingredients

  18. analytical value

  19. Analytical KSFs: credible and meaningful explanations or choices

  20. Airline Sourcing 101 • Discounts in return for market share • Airlines watch market share closely • Discounts depend on • Scheduled competitive capacity • Fare mix (proxy for profit margins) • Ability to move market share • Lastly, amount of spend

  21. Airline Supplier Options Under a Weak Travel Policy • Continental Newark Houston

  22. Chicago Detroit D.C. Memphis Atlanta Airline Supplier Options Under a StrongTravel Policy • Continental • Delta • American • Northwest • United Newark Houston

  23. don’t over-promise

  24. scenario modeling

  25. scenario results Projected Loss Projected Savings

  26. High Airline Sourcing Map Required Change Worst Sell A Sell A and B Sell B, then A Sell B and C Best Current mix Projected Loss Projected Savings (No Change)

  27. Airline Sourcing Best Practices • Consolidated, scrubbed TMC data • Pre-RFP strategy study • Airline sourcing map • Turbo sourcing for mature programs • Bid modeling • Goal integrity – no overlaps • Respectful relationships • Supplier conditioning, if necessary

  28. Hotel Sourcing 101 • Lower room rates for more room nights • Data is hard to track, so relationships matter • Can negotiate at chain or property levels • Rates depend on • Nearby competitor hotels • Annual room night volume • Relationships (direct, or via TMC) • Ability to move room nights

  29. London Hotel Usage

  30. Slide 1 detail (Arial 44) From Hotel Mapping…

  31. Slide 1 detail (Arial 44) To Client-specific Hotel Clusters

  32. Slide 1 detail (Arial 44) Including No-Stay Hotels

  33. Details of Cluster No. 4 56 % Compliance

  34. Which Chain is Best?

  35. Local vs. Chain Negotiations

  36. Cluster Benefits • Actionable Compliance Insights • Realistic Savings Targets • Smart Bid Lists • Relevant Rate Benchmarks • Sophisticated Negotiations Client-specific Hotel Clusters

  37. Hotel Sourcing Best Practices • Consolidated, scrubbed data from TMCs and credit cards • Pre-RFP cluster analytics • Chain and brand capacities • Local competitive markets • Smart bid list • Quick, credible negotiations • Persistent Implementation

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