Let's cut to the chase: corporate travel can be a budget-buster. With business travel expenses climbing and rules getting more complex, you need to decide: handle it in-house or bring in the pros? Here's the deep dive on company-negotiated rates versus travel management companies (TMCs), and how each of them can help you save on business travel.
What the DIY approach looks like
Your travel team goes toe-to-toe with suppliers. It's all about volume commitments and perks. Think guaranteed room nights, flight segments, or car rental days - big contributors to your corporate travel expenses. You're negotiating for free breakfasts, room upgrades, or flexible cancellation policies. But brace yourself for constant supplier schmoozing and the need for a dedicated travel manager to manage these relationships.
What the TMC approach looks like
TMCs? They're the heavy hitters. A travel management company like Corporate Traveller leverages our global client base to strongarm better deals. We're talking about combined travel volumes that dwarf most individual companies. We’ve got specialised negotiation teams, long-standing relationships with major players, and sophisticated data and reporting that can spot trends and savings opportunities you might miss.
The good, the bad, and the costly
DIY company-negotiated rates put you in the driver's seat. Tailor deals to your needs - maybe you need extra flexibility for last-minute changes or specific amenities for your execs. You can cosy up to suppliers for future perks, potentially scoring exclusive benefits for your top travellers. The catch? It's a resource hog. You need a skilled travel team, and smaller companies might find themselves outgunned when it comes to negotiating power.
TMCs, however, take the wheel, handling negotiations and bookings. Many have online booking tools that can enforce your travel policy automatically. Their data analytics can track travel expenses across departments, identify out-of-policy bookings, and spot trends to optimise your expense management. Plus, a TMC like Corporate Traveller offers 24/7 emergency assistance - crucial when your CEO is stuck in Shanghai due to a typhoon. We’ve also got access to deals you can't touch, like wholesale hotel rates or airline deals across multiple carriers.
TMC tech: More than just smoke and mirrors
TMCs aren't playing around with their business travel technology. They're negotiating across a broader field - not just the big names, but also boutique hotels or regional airlines that might fit your needs better. Their data game is next level - offering business travel analytics with tailored insights.
Expect potential savings of 5% to 50% on your travel spend. How? By diving deep into your travel patterns. Maybe they'll spot that your sales team always books last-minute flights to London and negotiate a special rate for that route. Or they might realise you're overpaying for hotels in Dubai during off-peak seasons and suggest alternatives.
Want to know who's spending what and if they're playing by the rules? TMCs provide comprehensive reports that give you the full picture. You can see spend by department, individual, or project. Track travel policy compliance and intervene before costs spiral out of control.
Hybrid approach: Best of both worlds
You could even ask for a hybrid approach, blending your TMC’s muscle with your existing deals. This can be particularly powerful if you've got strong relationships with certain suppliers but want to leverage TMC power for everything else like tracking travel expenses.
Picking your path
Big player with straightforward needs? DIY business travel might be your game. If you've got predictable travel patterns and the resources to manage negotiations, you could come out ahead. Already tight with certain suppliers? Leverage those relationships.
TMCs can flex for any size company, but they're a godsend for smaller outfits without the clout to strong-arm suppliers. Got travel plans more complex than a Rubik's Cube? A TMC's expertise could be your secret weapon. They excel at managing multi-leg international trips or coordinating travel for large groups.
Consider your company culture too. If you've got a lot of last-minute travellers or people who like to book their own trips, a TMC's online booking tool could be a game-changer.
Conclusion: Weigh your options carefully
Size up your travel volume, complexity, budget, and resources. Look at your current travel patterns and pain points. Then decide: keep it in-house or bring in a TMC. Remember, the right choice isn't just about saving money - it's about creating a travel programme that supports your business goals and keeps your business travellers productive and happy.
Whether you go DIY or TMC, make sure your approach aligns with your overall business strategy. If you want to chat with us about how we can help you negotiate rates and manage your business travel budget, get in touch with the Corporate Traveller team.