Business travel becoming a commodity 'like paperclips'

14 February 2002
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14 February 2002 | David Arminas

Business travel is fast becoming an off-the-shelf commodity like paperclips, according to a senior buyer at The Boots Company.

Steve Raven, the firm's manager of business travel, said there was a trend towards commodity-type procurement practices for travel packages.

He told the Business Travel 2002 conference in London: "We can now apply off-the-shelf methods to travel.

"In fact, everything is a commodity until it has been branded, and then it becomes a desired object."

Raven pointed to the trend towards buying hotel rooms, aeroplane tickets and car hire in bulk as an indication of this.

But he acknowledged that individual requirements often mean there is still a limit to off-the-shelf travel buying.

For example, there is more concern over security for women than for male employees when they stay in hotels.

However, Clifford Collis, head of travel for western Europe at Andersen, was more convinced travel was already a commodity.

He cited the growing number of new providers of travel, including low-budget airlines where the emphasis is on buying a no-frills generic service for use by most of a firm's employees.

He added that web booking has quickly moved travel buying towards being a commodity.

"But the real question about travel buying being a commodity is whether we can apply the traditional principles of purchasing to it," he said.

"The answer is yes. We can apply best-practice methods of buying large amounts, we need a policy for buying, we need to control maverick buying and we need senior management buy-in for it to work."

However, Collis agreed with Raven that travel must somtimes be treated as a bespoke product.

"It is sometimes not a commodity because it will need a collaborative process across various departments to set it up."

SMfeb2002

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