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Buyer consolidates agencies globally. (Travel Management).

Publication: Business Travel News
Publication Date: 09-JUN-03 		Format: Online - approximately 1164 words
Delivery: Immediate Online Access

Article Excerpt
There can be few businesses that have transformed their travel programs as radically as the oil, gas and information technology company Schlumberger. In 1999, its oilfield services division used 278 different travel agencies in the United States alone. Today, it has come close to reducing to just two travel management companies worldwide.

Even more remarkable are the contracts driving these relationships. The fee earned by the travel management companies is adjusted according to three criteria: In each country, Schlumberger pays the TMC a fee to cover the cost of servicing the ac count, with an additional small transaction fee for overheads and profit. If the cost of servicing the account comes in below budget, then the difference is shared between client and TMC. However, the figure is adjusted according to the approval rating from travelers and bookers measured in customer satisfaction surveys. If, for instance, the TMC is entitled to $100 in savings and has registered an approval rating of 89 percent, the figure is adjusted down to $89. Finally, the TMC is...



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