The 2018 ABTA Corporate Travel Forum was recently held in Nairobi, providing a space for the leading Travel Buyers, TMC’s and Travel Suppliers to discuss key trends, challenges and opportunities affecting the region and address how these trends are impacting both local and global Travel Industry as a whole.
The forum provided an interesting dialogue between TMC representative and their counterparts from the corporate procurement departments.
Managing corporate travel has moved from being the exception to the rule as globalization steadily increase. “Think globally, act locally” is a frequently used phrase in the corporate travel yet considerably harder to put into practice. Corporate travel accounts for the largest percentage of business for many TMC’s across Africa.
While opening the ABTA forum, the CEO of Kenya Association of Travel Agents (KATA), Nicanor Sabula observed that the annual BSP gross sales in Kenya averages 500m USD out of which an estimated 80% is attributed to business travel. This means that business travel will continue for a foreseeable future remain the mainstay for many travel agencies in Kenya.
The direct flight between Kenya and New York from October this year will be a great boost for corporate travel. This is because of the number of American corporates setting shop in Kenya. TMCs and agencies will reap from the increased outbound travel.
Speaking at the event, Monique Swart, founder of African Business Travel Forum (ABTA) opined that TMCs need to understand their customers and buyers in order to grow and maintain corporate travel business.
With innovation, technology and the changing trends in the industry, players need to adapt to this trends in order to stay relevant in the market according to Mr. Shukri Nunow, Marketing Representative at Turkish Airlines. He was of the opinion that the current travel buyers were mostly millennials who are a tech-savy generation but the industry in Kenya seem to be slow in understanding their changing needs.
While computers have been an integral part of the corporate travel business since their widespread adoption, the information Age has brought considerable benefits. Data can be stored more quickly than in the past thanks to higher-speed hardware and better software.
Josephine Fifi Rurangwa, Head of Africa expansion and airlines partnerships at Wakanow.com added that there is a big gap in communication between corporates and Travel Management Companies (TMCs) majorly because of the insistence by the buyers on cost reduction. However, Kenneth Kulei, Category Buyer, Equipment & Services at Commercial Bank of Africa quickly countered that, “As buyers we may not be travel experts. All we seek to achieve is value for money. Show us the additional value and cost will not be an issue.” Mr. Kulei argues that TMC’s have failed to demonstrate value to the buyers as they offer similar services.
‘Corporate direct’ is a general trend that cuts out across the economy. Corporates are now building direct business relationships with the suppliers, that is, companies negotiating and booking tickets directly with airlines at a cheaper price, automatically throwing travel management companies out of the business. “Local companies tend to have direct contract with hotels” stated Hassan Jushuf, Director DoubleTree by Hilton. An opinion shared by Mr. Shukri Nunow of Turkish airlines who seem to think that multi-nationals understand the value of TMCs better compared to local SMEs. “Corporates need to have structures that benefit both the TMCs and themselves,” he added.
All said and done this was a good forum for interaction between travel buyers and sellers and it left both parties calling for more sessions of a similar nature in order to enhance their business relationship. The CEO of KATA Nicanor Sabula and the Founder and CEO of ABTA Monique Swart agreed to collaborate in organising for more sessions for KATA members.
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