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NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
Csaba Demeter
New Business Director
csaba.demeter@buttery.ro
1# Introduction
2# Lay the Groundwork
3# Gather Data
4# Narrow the Field
5# Prepare & Send RFPs
6# Evaluate the Proposals
7# Negociate
8# Sign a contract
9# Debrief Unsucsessful
Bidders
10# Implement the
Account
share
HOW TO
Travel Management Company (TMC)
selection is about nding the right
conguration, service options,
product portfolio and cost basis.
If you already have a TMC, put serious
thought into whether you need a new
one.
If you:
- want to renegociate your contracts
or
- select a new TMC
NOW you can read our
FREE eBook: HOW To Select a Travel
Management Company
Your FREE
Tips & Tricks, Suggestions & Recommendations
!
eBook INCLUDES
!
Lay The Groundwork
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Entering into a multi-year partnership
with the right travel management
company enables travel management
professionals to focus on spend
analysis, budgeting, supply chain
management, policy development,
program benchmarking and other
strategic areas.
Travel Management Company (TMC)
selection is about nding the right
conguration, service options,
product portfolio and cost basis. If
you already have a TMC, put serious
thought into whether you need a new
one.
! Are there realistic service and cost
reasons to switch travel management
companies?
! If you are only dissatised with
some of the services or nancial
terms, consider asking the incumbent
TMC to correct these as a condition of
contract extension.
! If you plan to adopt or change an
online booking tool, consider running
that selection process at the same
time as TMC selection to smooth
implementation.
! DO NOT bid simply to test the
market; it is unfair and unwise.
Requests for proposals are costly and
time-consuming for everybody.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
1# Introduction
Gather Data
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
! Understand your companys vision and overall
objectives: cost versus service; regional, national
or multinational structure; autonomy versus
consolidation; automated or manual support;
opportunities for earliest implementation.
! Survey travelers and budget heads about their
perceptions and experiences. Consider
establishing performance benchmarks in key
locations using di!erent TMCs.
! A year before a new pitch, consider a travel
management audit and technology assessment,
and develop one-, two- and ve-year travel
operations plans. Coordinate with the legal and
risk departments regarding safety issues.
! Does your company contract directly with an
online booking tool or is it part of the TMCs
o!erings? Consider parallel bid competitions for
both scenarios.
! Document any requirements for mobile
applications.
! Obtain senior management authority.
! Assess whether you wish to do this all in-
house or to outsource part of the selection
process. Consider hiring an independent
consulting rm.
! Communicate with the existing travel
management company a year or more in
advance your desire to bid/rebid for these
services. Prior to this, make sure you are aware
of the cancellation clauses in your contract, such
as those that prevent early solicitation; you
should never agree to such terms.
! Understand your internal approval process
and what levels of approval may be
required to award the bid, especially if the
incumbent does not retain the business.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
2# Lay The
Groundwork
Narow The Field
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Engage existing TMCs and/or internal
departments to collect available data by country
and/or location. Collect data, which helps TMCs
develop operational plans and pricing proposals.
! Break down international and domestic gross
and net air transactions and sales. If available,
also provide a breakout of international travel
into regional and intercontinental travel. Include
rail, auto and ferry options where available.
! Provide total transactions for the most recent
year plus the two preceding years.
! Make a reasonable estimate of the rst years
volume after implementation, especially if there
are likely uctuations that will a!ect service
needs. This will impact sta"ng and total costs,
including the budget you need.
! Break down air, hotel, car rental, rail and
ground transportation spending by country or
region.
! Identify company travel patterns, including the
number of VIP travelers, independent
contractors and frequent travelers, as well as
seasonal uctuations.
! The percentage of bookings made by phone,
online and e-mail. Determine the percentage of
online transactions that require human
intervention. A high touchless transaction
percentage can reduce costs.
! Share of total hotel room nights and car rental
days booked through the current travel
management company.
! Payment process details, including billing and
payment conguration.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
3# Gather
Data
Prepare And Send RFPs
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
! Prequalify bidders based on company
procurement guidance and client proles of
bidders customers.
! Ask buyers who have similar budgets and/or
are from the same industry about their
experiences with the bidders. Speak with TMC
representatives before the RFP is issued and the
process is underway.
! Consider how the bidders balance and
measure service and cost avoidance. Review
their HR policies, training and turnover rates,
especially for front-line counselors.
! Evaluate TMCs automated tools and their
ability to integrate with other corporate systems.
! Determine which TMCs best support the use
of technology, possibly including:

Automated expense reporting

Pre- and post-trip reporting

Traveler tracking and other risk management

tools

Payment system integration

Tracking/refunding unused tickets

Mobile applications for travel

! Ask the TMC about its suppliers, including
global distribution systems, and seek alignment
of incentives for supplier support.
! Determine TMC involvement in online booking
systems and fulllment of online transactions.
! Ensure that a TMC can deliver on any specic
preferences or expectations. Seek detailed
reference checks, including non-cited references
and lost accounts.
! Investigate how the TMC handles refundsan
area of potentially signicant negative cash ow
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
4# Narrow the eld
Evaluate The Proposals
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Include in the RFP the following:
! Bidding rules and information about weighted
criteria; information security and data privacy
requirements; standard terms and conditions;
whether an in-person presentation will be
required; a timetable for the process. Consider
two phases, the rst to eliminate weaker bidders
and the second for best and nal o!ers.

! Your organizations travel policies, objectives,
requirements, data, current service conguration,
service expectations, reservations and payment
methods.
! Ask for information on the prospective TMCs
o"ces and call centers, operating hours and
after-hours service and support, years in
operation, headcount, agents average years of
industry experience and length of time with the
TMC, online booking adoption rates.
Assess:
Audited nancial statements
Number of sta! to be dedicated to your
account and experience of those agents;
Call overow procedures and whether backup
will be provided in case of emergencies and
absences
Complaint resolution procedures
Traveler services: emergency services,
reservation changes, international (passport,
visa, legal and medical referral) services,
security alerts
! Meetings & Events services: Dedicated
planning sta! & their experience?
!Reporting:
What types of reports are available?
How often will reports be provided?
G. Financial and billing information
Provide a spreadsheet in the RFP for TMCs to
complete, so proposals are returned in the same
format. Separate revenues into:
- base airline commissions,
- hotel and car commissions,
- event management commissions,
- assistance commsions.
Use a common currency for bid comparisons.
Consider fully loaded management or
transaction fees
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
5# Prepare and
send RFPs
Request For
Proposal
Negotiate
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Develop an evaluation structure ensuring
reviews are as objective as possible. Quantify
the areas of evaluation by some sort of point
system and weight areas that are most
important to the company.
! Separate the technical proposals from the
nancial proposals. Evaluate the technical
proposal and score prior to giving the
evaluation committee sight of the nancial
proposals for evaluation. Evaluating both at
the same time may color the judgment of the
technical committee.
! Have legal review requested changes to
your terms and conditions.
! Put nancial implications in the context of
the services provided. Base the decision on
more than the proposal alone, including cost
of change and risk, the quality and
experience of the key people assigned and
the cultural t.
! Get bidders to answer and clarify any
questions you may have.
! Invite the bidders to present and take
questions on their proposals while sticking
to a pre-set agenda. Ensure the TMC brings
people who can answer operational and
technical questions. Consider separate
webconferences for demonstrations of
technology.
! Call TMC references, including recently
implemented or lost accounts. Call clients
not included on the reference list. Be
prepared to share results with the TMC.
! Compare the nancial o!ers and sta"ng
proposals on spreadsheets.
! Reduce the eld
to two or three nalists.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
6# Evaluate
The Proposals
Sign A Contract
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
! Depending on the nalists best and nal o!ers, determine whether you need to
negotiate with the nalists or the leading bidder only. Determine the appropriate fees
and other terms you will accept.
! Require a solid rationale for any requested changes.
! Contracts should contain denitions of key business phrases in the terms and
conditions, nancial, service-level agreement and data privacy and security sections.
! Review your companys balance of trade guidelines.
! Include the contingency emergency support plan in writing as part of the
implementation package. Engage your companys internal risk management and
security departments to review the TMCs security plans and technology.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
7# Negociate
Debrief Unsuccessful Bidders
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
Do not use only a standard TMC contract form.
! Formulate a document that reects your
specic legal, service and nancial
considerations. Consider providing this early in
the RFP project, asking all TMCs bidding on the
business to review the legal language and
provide red-line copies back to the company.
This will speed up the contracting process with
the nalist.
! Do not award the business until after you have
both agreed to all the contract terms and
conditions.
! Contracts should contain specic
requirements, including service-level
agreements, and dene expectations as well as
nancial incentives and penalties. Consider
positive nancial incentives for high
performance.
! Obtain guarantees from the TMC on quality
control systems, and consider auditing to verify
its claims.
! Contracts commonly last for one to two years.

Determine for how long pricing will be

xed and whether to allow for a pricing
adjustment during the contract term.

Include a plan and consider volume

adjustments.

Require annual reviews and options for

an additional year or two.

Clearly dene cancellation and

termination clauses, including notice
periods, corrective action requirements
and potential reimbursement to the TMC
for prorated losses incurred (unless the
TMC is at fault). In case of termination,
include transitional service obligations.

Avoid agreements in which the contract

automatically rolls over at its conclusion

Ensure that TCMs meet the minimum

data protection rules in countries covered
by the RFP
! If the TMC will fulll bookings, the service-level
agreement must detail service expectations for
changes, refunds or support.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
8# Sign A Contract
Implement the Account
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
!
Bidders deserve honest, general feedback.
!
Treat them with respect; although they may not be servicing
your account, as business changes they may be able to service
you in the future.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
9# Debrief
Unsuccessful Biders
Request an offer
NEXT
Travel
Corporate
HOW to Select a
Travel Management
Company?
! If the present suplier does not win the bid,
start work quickly on implementation.
Discuss the process with all divisional travel
managers and travel management company
account managers.
! Develop a schedule that clearly denes
implementation steps and responsibilities.
Consider introducing the program
throughout the company, especially if it is
global.
! Solicit the travel management companys
help with materials for travelers and
arrangers. Consider a phased approach at
one site, country or region and allow
feedback before proceeding.
! Host a meeting between the outgoing and
the incoming TMCs to make certain all
parties agree to the transition timeline and
other professional courtesies.
! Include eld o!ces in the implementation.
If the travel management company will have
onsite o!ces at remote locations, ask if it
will allow local sta" to choose the TMC-
employed manager and agents.
! With the marketing or communications
department, develop an employee
communications plan.
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
10# Implement The Account
Travel
Corporate
HOW to Select a
Travel Management
Company?
Buttery
Tourism
To Buy is to Trust! 14 Year of TRUST.
Csaba Demeter
New Business Director
csaba.demeter@buttery.ro
0740 96 70 62
share
Contact us for an
appointment:
Travel Management Company (TMC)
selection is about nding the right
conguration, service options,
product portfolio and cost basis.
If you already have a TMC, put serious
thought into whether you need a new
one.
If you:
- want to renegociate your contracts
or
- select a new TMC
You read our
FREE eBook: HOW To Select a Travel
Management Company
We hope you found interesting and
useful information in our eBook.
To Buy is To Trust. 14 Year of Trust. Buttery
!