Business travel is evolving, so why aren’t suppliers moving with it?

17 Dec 2021 11:03 By Gavin Smith

SMEs are spearheading business travel recovery...

Every generation has been involved in a shift in the way we do our jobs. Whether these changes were brought about by the introduction of computers, the rise of the internet or the mobile phone revolution, we all understand how they changed the way we work forever. Today, remote working is the next big shift in business operations – we’re moving on from the 9-to-5, office-centric, five-day working week to something much more flexible.

Businesses are being reimagined. How we do our jobs and how we run our companies is changing. People are making new choices about where they want to live and are developing new expectations about working circumstances. This latest shift is massive and, when you add environmental issues and sustainable travel into the mix, as far as business travel is concerned, you have the perfect storm.   

We are however seeing the green shoots for business travel recovery. Face to face events are returning, replacing virtual events around the world, and the realisation that critical meetings with potential new clients just aren’t the same on Zoom or Teams, along with the opening of borders, are driving the return of the business traveller.

But it will be different. According to a report in Deloitte, corporate travel will pick up but will sit well below pre-pandemic levels – somewhere between 25 to 35 per cent of 2019 levels in this fourth quarter of 2021. The report goes on to say that projections indicate that the smaller companies will resume travel at a faster rate than the bigger companies.

Small is mighty
Business travellers entering the post-pandemic era from companies with fewer than 1,000 employees universally want to get back out on the road, according to Deloitte, and they see their companies facing severe consequences if they do not increase travel, with fewer deals signed or existing contracts renewed. At my company, Element, we are seeing these signs first hand.
The we way we work and travel for business is changing but in many ways the processes and businesses that make the whole thing work are not – and by that I am referring to the infrastructure behind SMEs and their TMCs.   
Travel managers will want their TMC to have access to their preferred or latest technology. Whether that’s for travel and expense management, automation or data management. The problem for smaller TMCs – many of which are helping spearhead the return of business travel – is that most large tech suppliers have closed the doors to smaller businesses, usually because they don’t meet their minimum supply or support requirements and they are too small for tech suppliers to manage. This means that some smaller TMCs simply can’t supply the tech their clients are demanding.
For a travel manager, what’s the answer? Well, they could stay where they are, they could move to a different TMC, or they could go direct to the tech supplier and try their luck there. If you have the tech you want for your managed travel programme you’re fine, but if you don’t, you have a problem.

Access all areas
Another solution is an intermediary that sits between smaller TMCs and the tech companies – a reseller that accesses all the tech that large TMCs offer but can provide the required level of support and expertise, either to the travel manager or to the TMC. And, importantly, without the need to be managed by the supplier.

The value add that this brings is being able to deliver a full end-to-end solution: approval, booking, automation, expense and analytics. The cost of ownership is reduced, speed to market is increased and smaller agencies get access to new generation software.
There are referral agreements happening in the industry now but it’s not enough. This seismic shift in the way we work and do business in the future requires changes across the board. Business travel managers need an open playing field when it comes to technology, and access should not be determined by their turnover or how deep their pockets are.
Smaller companies will lead the way forward in business travel and it's time they got the same opportunities their larger counterparts have been enjoying for years. It’s time for technology companies in the managed travel sector to step up and become the suppliers that our industry needs – and that means indirect distribution via non-TMC resellers.

Every other software segment does it and ours, the travel business, is the last one to work out that they need to get their product to where their clients want it, and not just where it suits the tech business.

Gavin Smith