A Complete Guide to Travel Management Company

The global business travel market is experiencing significant growth, with the corporate travel industry projected to expand by 188 percent by 2028, according to Statista. This surge presents challenges for travel managers who must handle the increasing volume of travel itineraries, ensuring accuracy and efficiency. 

Key issues include managing high volumes of bookings, controlling costs, ensuring traveler safety, maintaining compliance with corporate policies, and integrating advanced technology solutions. Companies are actively seeking ways to streamline these processes to accommodate the rise in business travel effectively and efficiently.

One way to manage your organization’s increasing travel needs is to hire a good Travel Management Company (TMC). A TMC is an organization dedicated to managing your company’s complete business travel needs. Unlike the traditional travel agent, a TMC’s services go above and beyond booking flights and hotels. 

Let’s understand what a TMC is in detail. We will also examine its advantage and the significant differences between a TMC and a travel agency. 

What is a Travel Management Company?

Travel management companies (TMC) assists businesses with developing and managing their corporate travel programs through a variety of services and technologies. Unlike traditional travel agencies that primarily focus on booking travel, TMCs work directly with businesses to analyze and streamline all aspects of their travel programs. 

They implement new technologies to help businesses achieve their travel goals, such as tracking progress, managing costs, and enhancing overall travel efficiency. TMCs provide a holistic approach to company travel management, addressing every aspect, from booking and budgeting to compliance and reporting.

A travel management agency offers a broader range of customized services tailored to the specific needs of corporate clients. They provide valuable reporting options, manage unused tickets, and offer booking solutions that align with the company’s policies and culture. 

What Does a Travel Management Company Do?

A business travel management company provides services ranging from consolidating online booking and expense reporting to travel risk management. It aims to help your organization simplify the business travel management process. Some of its offerings include:

1. Policy Creation and Integration

• Developing Travel Policies: TMCs work with businesses to create comprehensive travel policies that align with corporate objectives and compliance requirements.
• Integration: They ensure these policies are integrated into booking systems and tools used by employees.

2. Booking and Reservations

• Comprehensive Booking Services: TMCs handle all aspects of travel booking, including flights, hotels, car rentals, and other transportation needs.
• Preferred Vendor Negotiations: They negotiate with preferred vendors to secure special rates and benefits.

3. Expense Management

• Budget Monitoring: TMCs help businesses track and control travel expenses by providing detailed reports and insights.
• Cost-Saving Strategies: They implement strategies to reduce travel costs without compromising on quality or safety.

4. Risk Management

• Traveler Safety: TMCs provide tools and services to ensure the safety and security of travelers, including real-time alerts and travel advisories.
• Crisis Management: They offer support and contingency plans in case of emergencies or disruptions.

5. Technology Implementation

• Advanced Tools: TMCs implement technology solutions such as booking platforms, expense management software, and mobile apps to streamline the travel process.
• Data Analytics: They use data analytics to provide insights into travel trends and performance, helping businesses make informed decisions.

6. Reporting and Analysis

• Detailed Reporting: TMCs generate comprehensive reports on various aspects of corporate travel, including spending, compliance, and traveler behavior.
• Performance Tracking: They track the progress of the travel program against set goals and KPIs.

7. Customer Support

• 24/7 Assistance: TMCs provide around-the-clock support to handle any issues or changes in travel plans.
• Personalized Service: They offer personalized assistance to travelers, ensuring a smooth and hassle-free travel experience.

Suggested Read:

Top 10 Corporate Travel Management Companies

Difference Between a Travel Management Company and Travel Agency

In contrast to a TMC, an online travel agency (OTA) is a web-based platform that allows consumers to book travel services. It can include booking flights, hotels, car rentals, and vacation packages. Some major differences in a TMC and OTA are:

1. Scope of Services

• Travel Management Company (TMC): Offers a comprehensive suite of services tailored to corporate travel needs, including policy creation, expense management, and risk management.
• Online Travel Agency (OTA): Primarily focuses on booking travel services such as flights, hotels, and car rentals for individual consumers.

2. Client Focus

• TMC: Works directly with businesses to manage and optimize their entire travel program.
• OTA: Caters to individual travelers and leisure travel needs, offering self-service booking options.

3. Technology and Tools

• TMC: Implements advanced technology solutions like expense management software, mobile apps, and real-time data analytics to streamline corporate travel.
• OTA: Provides user-friendly online platforms for booking and comparison but with limited integration of corporate travel tools.

4. Support and Assistance

• TMC: Provides 24/7 personalized support and assistance, including handling emergencies and last-minute changes.
• OTA: Offers customer support, often during business hours, with limited personalized service and assistance.

5. Cost Management

• TMC: Actively helps businesses control travel costs through negotiated rates, budget monitoring, and cost-saving strategies.
• OTA: Offers competitive pricing and deals but does not engage in active cost management for businesses.

Why Do you Need the Best Travel Management Company

To Increase Efficiency

A travel management company with a modern travel management system can help you automate your travel management process.

With such tools, your employees can book flights, hotels and other travel-related services themselves. Moreover, they get customized options. Such options ensure that they no longer have to sift through multiple third-party websites to find the best-suited flights and hotels. Additionally, your finance team can get valuable insights into your employees’ spending habits. This can help them control travel costs and modify travel policy if required.

To Optimize Business Travel Management Policy 

Instances of travel policy violations increase if your employees don’t understand the policy guidelines or find them impractical to follow. 

With the help of a business travel management company, you can create a better T&E policy. You can be sure to include traveling employees’ comfort and your organization’s needs. Improving your business travel policy will ensure better compliance and help you achieve your corporate travel goals.

To Reduce Business Travel Costs

Businesses struggle to keep their travel costs in check. This is because traveling employees often make out-of-policy flight and hotel bookings. Moreover, they might also spend above their per diem allowances, and file out-of-policy expenses. 

Although using a travel management system is expensive, the benefits outweigh the costs. A TMC can provide you access to various flights and hotels at negotiated rates. Additionally, you can get travel management services like VAT recovery, which can help you save significant business travel costs. 

To Get Travel Spend Insights

Understanding your employees’ spending habits is essential for multiple reasons. It can help you figure out cost-heavy and saving-heavy departments. You can also find out which employees are top spenders and the reasons behind those expenses. This can help you discover loopholes in the travel expense management process and determine any policy changes if required. 

An advanced TMC like itilite, can help you gain insights into your employees’ spending habits. itilite offers world’s first virtual travel consultant– Mastermind. The AI-based corporate travel consultant can help your business travel management company identify and fix cost leakages by:

1. Analyzing past travel data
2. Conducting industry benchmarking
3. Suggesting actionable steps you can take to fix unnecessary leakages

To get a first-hand experience of Mastermind, click on the button below.

To Benefit from Concierge Services

There are specific added requirements for any business trip like airport lounges, VISA services, etc. The travelers have to look through multiple websites and go through confirmation emails. 

A TMC manages all the concierge services on your behalf. You get the best prices and services without any additional stress.

To Avail 24/7 Assistance

Business travel is full of uncertainties, and your employees might need assistance to accommodate any last-minute changes. For instance, travelers may be unable to check in and out of the hotel because of some document-related issue. In such cases, they need prompt support to ensure resolution.

A TMC provides multiple active channels around the clock for the employees to get in touch in an emergency. Additionally, an advanced TMC can also provide AI-based chatbots to solve routine problems outside office hours.

A TMC may help you improve the health of your T&E processes or systems significantly. Check out the T&E health calculator below in order to know where your organization currently stands and the scope for improvement.

Better Negotiation Power

A business travel management company (TMC) enhances a company’s negotiation power through two key strategies. First, by consolidating travel bookings, TMCs can secure volume discounts from suppliers, leveraging the collective purchasing power of their client base to obtain better pricing on flights, accommodations, and other services. 

Second, TMCs foster strong relationships with travel service providers, which can lead to preferential treatment, additional benefits such as upgrades or amenities, and improved service quality, ultimately enhancing the overall travel experience for corporate travelers.

Scalability

Scalability and flexibility are integral to travel management companies (TMCs), as they offer adaptable services that can grow alongside a business’s evolving needs. TMCs provide customizable solutions that cater to specific travel requirements and preferences of both the company and its employees.

This flexibility allows TMCs to adjust services, such as expanding travel programs or incorporating new technologies, ensuring that company travel management remains effective and tailored to meet ongoing business demands.

How to Choose the Best TMC for Your Business Travel?

Choosing the best business Travel Management Company (TMC) for your business travel needs involves several key steps:

1. Assess Your Needs: Determine your company’s specific travel requirements, including the volume of travel, destinations, and budget considerations.
2. Research TMCs: Look for TMCs with expertise in your industry and a track record of successfully managing corporate travel programs.
3. Compare Services: Evaluate the range of services offered by each TMC, including booking capabilities, technology solutions, and customer support.
4. Check Reputation: Read reviews and seek referrals from other businesses to gauge TMC’s reliability, responsiveness, and overall reputation.
5. Cost Analysis: Compare pricing structures and fee transparency among TMCs to ensure they align with your budget and expected return on investment.
6. Customer Support Availability: Evaluate TMC’s customer support offerings, including availability of 24/7 assistance for travelers, responsiveness to inquiries, and their ability to handle emergencies and last-minute changes effectively.
7. Evaluate Technology: Assess the TMC’s technological capabilities, such as online booking tools, mobile accessibility, and reporting features.
8. Meet and Discuss: Schedule meetings or calls with shortlisted TMCs to discuss your needs, ask questions about their services, and determine if they can provide tailored solutions that meet your business objectives.

What to Expect from the Best Travel Management Company?

An ideal TMC should deploy state-of-the-art technology. This will help you improve every aspect of your travel process such as booking, approvals, travel policy compliance, and support.

This is what we do at itilite. Our integrated travel and expense management software can help ease your employees’ booking experience by providing customized travel policy-compliant options. Moreover, we provide 24/7 free assistance for employees in case of emergencies. We can also help you create a comprehensive travel policy and duty of care plan. 

To know more about how we can help boost the efficiency of your travel process, get in touch with us. 

Frequently Asked Questions