Corporate travel management company fees (& how to reduce them)
Travel managers have many choices when deciding which type of travel booking solution to use. They may opt to use a traditional TMC, self-booking on consumer websites, local travel agents, or online booking tools (OBTs). Each of these options offers different pros and cons, as well as different fee structures.
Implementation costs are typically associated with software platforms. However, not all travel management software companies charge them.
Transaction fees are usually charged as a percentage of each transaction. In this case, every travel-related action a TMC takes on your behalf (such as a reservation, a change, or a cancellation) comes with an associated fee.
Management fees are designed to cover the cost of a TMC’s services. These include account management, customer support (particularly support outside of office hours), and refunds.
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Some TMCs charge extra for concierge services. While ordinary business trip booking services may include train, flight, or hotel reservations, concierge services would include booking conference tickets, meeting rooms, airport transfers, or Airbnbs.
Certain TMCs offer the option of booking either over the phone, or using a self-booking platform. In this case, they may add on an additional fee for phone bookings. Other companies add on fees for specific types of bookings (such as bookings on a low-cost carrier).
Finally, there is the one-off pay per trip pricing structure. This is what we offer with our travel management software here at TravelPerk.The pay per trip model is clear and easy to use. Our Premium and Pro users pay a single low fee for each trip, and they only have to pay when they travel. This fee covers everything from bookings, to travel policy management, to customer support and concierge services.
Traditional TMCs are business travel agencies that offer a variety of services, from ongoing booking support to managing a corporate travel policy. They can help businesses with travel-related functions such as reservations, airport lounge access, expense reporting, and travel risk management.
Some businesses use local travel agencies rather than corporate travel management companies. This approach offers a personal touch, but also has many drawbacks.
Budget-conscious organisations may prefer to avoid travel management companies altogether, instead opting to self-book travel using consumer websites.
Finally, travel management software platforms, also known as online booking tools (OBTs), offer an efficient modern solution for business travel. These software packages give you the same services you’d expect from a traditional TMC, but at a competitive price point and with more control over your own bookings.
In sum, to find an affordable travel management option and realise cost savings, you’ll need to understand the different types of fee structures and choose one that meets your business needs. When evaluating travel management company fees, don’t forget to factor in time spent on booking, and whether the fees are recurring or on a per-trip basis. You’ll also want to consider if a travel management company’s fee structure gives you visibility over your total travel costs.
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