Tesla and Microsoft Are Looking For Corporate Travel Agencies to Adopt Customized Business Models
Skift Take
There's a lot of rhetoric about the need to find business models that work for everyone, as the viewpoints of Tesla and Microsoft demonstrate, but there has been little action so far.
Some conversations just won’t go away, and that includes how travel management companies turn a profit.
The transaction fee is back under the microscope, and travel managers at Tesla and Microsoft have renewed calls for a shake-up.
In April's peak lockdown, Skift raised the issue about why it’s time to reboot the corporate travel agency model as questions arose as to how these companies would survive an extended travel ban.
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Traditionally, an agency charges a company client a transaction fee for a business trip. They’re paying for booking the travel, but bundled into that fee comes all of the other agency-provided extras, such as traveler tracking, data reporting and more. Without those bookings, there’s still no revenue. “It’s going to have to be a hot topic going forward,” Dominic Short, president of the Association of Swiss Travel Management, told Skit at the time. And four months on, yes it’s still a hot topic because the pandemic's resurgence means most business trips are still on hold. In the past few weeks, many agency groups, like a lot of other travel industry companies, have been forced to make layoffs as furlough support comes to an end — with operations staff particularly impacted. At Your Service? “I was surprised not to see anyone with a pandemic backup plan. It’s not th