Travel Management Industry Procurement Intelligence Report | Increase in Supplier OPEX to Impact Procurement Spend
LONDON--(BUSINESS WIRE)--Dec 18, 2019--
SpendEdge has been monitoring the global travel management industry and the industry is poised to experience spend growth of more than USD 600 billion between 2019-2024 at a CAGR of over 7% during the forecast period. Request Free Sample Pages.
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SpendEdge, a global procurement market intelligence firm, has announced the release of its Global Travel Management Industry Procurement Intelligence Report. (Graphic: Business Wire)
Read the 124-page research report with TOC and LOE on “The Global Travel Management Industry – Procurement Intelligence Report, Pricing Outlook in Geographies that include APAC, North America, South America, and MEA, and insights into best practices to optimize procurement spend.”
Partnerships with technology providers are not only improving services rendered by travel management service providers but are also facilitating cost savings by minimizing manual intervention. This is improving the scopes of growth for travel management service providers and is driving spend momentum in this industry. However, the penetration of online travel agencies and complications faced during enforcement of travel policies and compliances is hindering the industry spend growth.
High GDP growth across the APAC countries is inviting large business players to invest in the region. This is increasing the requirement and frequency of corporate travel which is driving airline companies to optimize air traffic routes and improve the frequency of flights between major business routes. This is driving the demand for travel management service providers in the region. Meanwhile, in North America, the presence of a robust domestic civil aviation infrastructure is enabling high connectivity between major cities. The presence of this infrastructure is also facilitating a high level of comfort with reduced travel time and creating the scope for in-flight connectivity options. This is contributing to spend growth in the travel management industry in the region.
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Insights into the industry pricing trends
What are the strategies to adopt to optimize procurement spend in this industry?
The travel management price trends imply a substantial increase in service provider’s OPEX which will result in a gradual decline in their profit margin. To compensate for this, service providers are expected to increase the market price. In view of this, this procurement intelligence report has listed the top travel management service providers, SLA agreement insights, and the selection and negotiation strategies that buyers must undertake to achieve optimal procurement in this industry.
Collaborate with travel management service providers to identify travel pattern
It is advised that buyers collaborate with service providers to identify employees’ travel patterns. This will include data sets for the time of booking, duration of the flight, and time and day of the flight. This strategy will help buyers build a comprehensive corporate travel guideline for their employees and ensure that a specific set of airline carriers are used for services. Moreover, these data sets are used to identify cost-saving opportunities. For instance, companies with large volumes of long-duration flights can split the number of flights to achieve higher cost savings.
Adopt a transaction-based pricing model
Buyers are advised to adopt the transaction-based pricing model while entering into a contract with a travel management service provider. This model is known to offer better spend visibility and aids to link incentive-based components to service providers’ fees, thereby maximizing ROI and enhancing the quality of service.
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INDUSTRY KEYWORD: TECHNOLOGY AIR TRANSPORT PROFESSIONAL SERVICES SOFTWARE OTHER TRAVEL TRANSPORTATION DATA MANAGEMENT TRAVEL OTHER PROFESSIONAL SERVICES
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