LONDON--(BUSINESS WIRE)--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.
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
The consolidated air travel market is compelling airline companies to shift from price-based differentiation to value-based differentiation. This is resulting in the cost of air travel skyrocket to a significant extent.
- Airline taxes and security fees are being hiked to cater to the rising expenditure to implement stringent and fool-proof security measures at airports.
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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Some of the key topics covered in this report are:
- Travel management industry spend segmentation by region
- Total cost of ownership analysis in the travel management industry
- Regional spend opportunity for travel management service providers
- Travel management service providers cost structures
- Travel management pricing models analysis
- Travel management procurement best practices
- Category management objectives
- Cost saving opportunities in the travel management industry
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