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Interview with UNIGLOBE Travel’s Senior VP John Henry

New spin on business travel

Hazel Heyer  Nov 16, 2008

Change is on its way for the SME segment of the business travel market, thanks to UNIGLOBE, the Vancouver, Canada-based pioneering business travel management franchise group. With its network of 700 franchises and affiliated Member Agencies over 45 countries (spanning the Americas, Europe, Africa and Asia) and annual system-wide sales of some $3 billion, UNIGLOBE® is committed to be on the leading edge of change in this dynamic industry.

Business travel is very serious business! In today’s climate of globalization in the corporate world in general, as well as the travel industry in particular, an agency that is serious about the business of business travel and is not a member of a brand name international network organization is at a serious competitive disadvantage. Globalization is here to stay and as it increases and technology continues to evolve, that disadvantage will only intensify, not just for those serving the needs of the mega-corporate segment of the market. Increasingly, the smaller coeporates are also becoming international enterprises in order to effectively market their goods and to take advantage of cost-effective production opportunities around the world, so those agencies/TMCs serving their travel needs must also have global reach.

UNIGLOBE® Travel is the leading global network of Business Travel Agencies specializing in the SME market segment. As a solution to the globalization challenge, UNIGLOBE® has launched its Global Partner Program where a limited number of established TMC’s/ Business Travel agencies in countries in which there is not an existing UNIGLOBE® presence could have the benefit of an international affiliation through a direct relationship with UNIGLOBE® World Headquarters, in Vancouver, B.C.

So far in 2008, new member agencies have joined the Uniglobe family in the USA, Canada, Mexico, Thailand, France, the UK, Romania, India, China, South Africa, Germany and Belgium as well as Jordan and Iraq. In fact, the presence in Iraq makes UNIGLOBE® the only global business travel network on the ground to service the companies going in to participate in the reconstruction. Recently, a Master License Agreement was entered into for the UNIGLOBE® rights to Mexico and Central America with Aversa, the Hertz franchisee in Mexico. The firm is also proud to welcome to the family Orbis Business Travel, the corporate arm of Orbis, the largest agency in Poland.

Global Partners enjoy the use of the International Brand in conjunction with their own identity, access to critical leading edge travel management technology, networking and collaboration on business opportunities and multi-national corporate accounts. They also get access to training and the benefits of buying power, as well as shared expertise from around the world. While UNIGLOBE Senior Management says that the Global Partner-type of relationship is where they see their growth in the future they are also open to discuss interest in Master Franchise opportunities, but only for sizeable and mature markets.

UNIGLOBE® was the brainchild of U. Gary Charlwood, founder, chairman and CEO of the $9-billion Century 21 Real Estate franchise in Canada. He founded the firm in 1980 after recognizing the efficiency of a single, cooperative, consumer marketing effort in the business of travel distribution. Disciplined focus was a critical element, that strangely, was innovative at the time.

We asked John Henry, Senior Vice President, Uniglobe Travel International LP to tell us how their concept differs from the other players in the business travel field.

eTN: Why do you target the SME market when it may be more profitable to run after bigger accounts?
Henry: It’s a different business with different dynamics, demands on service and financing requirements, and it is a fallacy that the mega-corporate market is more profitable. However, that segment of the market is well-served. By targeting our particular niche, we’re able to provide the SME’s or growth segment of the market with the level of service standard that normally would be experienced by the mega-corporates. Our rule-of-thumb is that no single account should represent more than 10 to 15% of total business volume of the agency.

eTN: Does focusing on small to medium market pose a bigger challenge to Uniglobe than if you were to address corporate business such as your global competitors such as American Express et al?
Henry: We don’t think it is harder. Rather we believe it makes it a little easier giving us a much bigger market to approach. People have not realized how big this market is. For example, more than 50% of U.S. exports are by businesses employing 19 or fewer people. And the story is similar in Germany, and many other countries. That segment of the market is growing, even in these economically challenging times. The business of our competitors who serve the mega-corporates have much greater exposure in difficult times than agencies serving the SME’s.

eTN: With this economic meltdown and a number of SME’s coming down crashing with the recession, how much risk is Uniglobe prepared to face? How do you plan to address today’s issues?
Henry: SME’s will likely ride out the recession better than many of the larger corporates, and since the service we provide is multi-faceted and supports the smaller corporate accounts with opportunities to maximize value for travel, we can better manage today’s SME’s travel budgets through comprehensive MIS and our global FareSearch program. Our approach is all about maximizing value and delivering the utmost in personal service offering the customer the option of high-tech or high touch, as the need occurs. Our customers are value-sensitive rather than price-sensitive. If they were price-sensitive, they’d go anywhere to save a couple of nickels. We’re interested in a customer who appreciates value-added service, and with whom we can build a long-term relationship…customers-for-life, we call it.

eTN: What is the UNIGLOBE® advantage?
Henry: To an agency, the UNIGLOBE® advantage is to be part of a global organization, with a global brand, global buying power, and a network of fellow agencies with whom to collaborate on multi-national corporate accounts, local market intelligence and product exchange. We really are a family. To a corporate account, it’s a newer and higher level of service.

eTN: Does UNIGLOBE® have a particular strategy for the present economic downturn?
Henry: We see this as a time of exceptional opportunity for those agencies/TMCs who have nurtured their customer-base and maintained effective control on its costs. The big guys will be cutting staff and costs…Amax recently announced 7000 lay-offs around the world. Often, some of the first cuts are to sales and marketing, leaving opportunities for those of us who are lean and mean and who still have feet on the street. Meltdown or no meltdown, in today’s challenging times UNIGLOBE® will stay ahead of major players in the SME global marketplace.

New spin on business travel

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