Should you go global or stay local?

When choosing a TMC partner, a key question should be whether to opt for one with a global reach, or one with local expertise. While both have their merits, what matters most is selecting a TMC that fits with the direction and aims of your company.

Local expertise is key

Global TMCs can provide more negotiating power with international suppliers. However, this can often come at the cost of being locked into agreements with suppliers that are not suited to the local market, something local TMCs are better able to adapt to.

If a global TMC is a better fit for your business, it is important to interrogate whether or not they have an engaged local presence.

“The issue is that not all ‘global’ TMCs have in-country teams like FCM Travel Solutions,” says Nicole Adonis, gm for FCM Travel Solutions. “Many TMCs work with local partners or franchises in select markets, which means service levels are not always consistent and, most importantly, data is not always consolidated.” Often in these cases, different technology or reporting systems are used, making consistent levels of service difficult. Scratch beneath the surface of some global offerings and you’ll often find conflicting processes, cultures and contractual arrangements, all impacting upon customer service,” she says.

Richard Beadle, manager and owner of Corporate Travel, says that there are cases of local TMCs who sign agreements with international TMCs, and then struggle to adapt their businesses to meet the rigid requirements set for them by international head offices. “I know of cases where the head office has dictated which supplier has to be used, even if that supplier is not a preferred supplier. Meaning the prices were not as good,” says Beadle.

“The benefit of being local is that you are more aware of the local situation, to the local market, and you can adapt and change as the market does,” says Beadle, adding that, in some cases, the larger, international TMCs can make decisions that do not fit with the local market, and end up costing clients more. Or that they can be slower to adapt to changes in a local market.

Going global

Even if a global TMC is your preferred choice, Adonis emphasises that the value of local content or expertise is not in question. “Corporate travel on the African continent is characterised by unpredictable business environments, foreign language barriers, foreign currency shortages, closed visa regimes and poor air access, hampering intra-African travel. From a travel policy perspective, companies need to receive reliable on-the-ground information to adapt more easily to each country’s unique requirements and idiosyncrasies.”

Truly global TMCs, according to Adonis, are able to gather, integrate, analyse and interpret local data on a global scale. This allows them to ensure that their clients’ programmes not only benefit from accurate data but from insight into how they can be improved.

“To become a global company or a global-first company, you have to globalise every aspect of your business,” she says. “This means every function within the company, and the people, process, and technology within that function need to be global, including your TMC.”

Relationships

Having a strong relationship with your TMC is crucial, whether they be local or global. Diwan Venter, travel manager at Travel by Arrangement, says that for local TMCs being able to meet clients regularly is an advantage, and is important for building relationships. He also points out that it makes it easier to meet the client’s needs as and when those change.

But Venter says there are advantages to having a global reach. For example, a global TMC may find that booking a flight may be cheaper if done through its international platform instead of its local one, and can then take advantage of the cheaper fare.

Marco Cristofoli, ceo BCD Travel, says that local relationships are very important in creating sustainable partnerships, but adds that they can be improved through a global TMC that is able to bring diverse solutions from other markets. “A truly global TMCs relies on its local country offices to adapt to the local nuances, which includes culture,” Cristofoli says. “The client global relationship team is augmented and enriched by the local relationship and able to fulfil local requirements which are enhanced by the physical local contact.” The advantage, he adds, is that the global TMC can provide enriched data and offer clients global technologies, innovation, and share best practice.

source: TAM