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Is it possible… For a large-market international company to save over 6% on airfares in six months?

Yes it is.

Veolia Environnement has significantly reduced the cost of its air travel by working closely with FCm’s travel and account management teams. This relationship has improved traveller booking and buying behaviour by increasing the use of preferred booking channels and suppliers.

Here’s how we made it possible…

Background

Veolia has been booking its travel through FCm’s parent company, Flight Centre Limited, for the past four years. Two years in, FCm took over the management of Veolia’s travel program due to the rapid growth of the account and need for moresophisticated travel management solutions.

Focus areas

In mid 2012, Veolia’s Procurement Manager Damien Sheehy rolled out a major travel initiative with support from FCm to complement Veolia’s existing travel program. This involved consolidating the booking process across Veolia’s four business divisions and increasing bookings with preferred suppliers to reduce the cost of air travel.

While the company had a travel policy in place, guidelines within the policy were not being adhered to or closely monitored. The fragmented nature of their program and ad-hoc nature of travel requests and bookings impacted the effectiveness of Veolia’s preferred supplier deals. It also made it difficult for the company to properly leverage their significant buying power with suppliers. As part of the initiative, the company had three key travel objectives:

A) All travel requests must go through Veolia’s travel bookers

B) All travel bookers must book with FCm

C) All bookings processed by FCm must be made with Veolia’s preferred suppliers.

Solutions

FCm played a key role in helping Veolia to achieve these objectives by:

Holding travel booker forums

Since 2012 FCm and Veolia have held quarterly travel booker forums. The first forum focused on the breakdown of travel spend for each division, use of preferred suppliers, advance booking trends, hotel compliancy and adoption of FCm’s online booking tool (OBT). Subsequent forums have allowed FCm and Veolia to share more detailed figures around supplier uptake, booking figures and compliance improvement measures.

Benchmarking

FCm supplied critical benchmarking data to Veolia to ensure their contract with their preferred airline was competitive in terms of the discounts being offered for different fare classes.

Improving compliance

Although Veolia’s travel policy is not mandated there was a push for FCm and travel bookers to ensure bookings were being made through their preferred airline. FCm also helped Veolia to revise their OBT reason-codes to allow for more in-depth analysis of non-compliant bookings.

Travel reporting and data

FCm provides Veolia with quarterly travel reporting to show travel expenditure breakdown across bookings. Data indicates the uptake for preferred air and hotel suppliers, and booking figures. FCm’s account management team also analyses which air routes are attracting the highest number of non-compliant bookings for Veolia. Data from reason-codes based on scheduling, routes and pricing are collated and used as part of Veolia’s contract negotiations with their preferred airline.

Results

In the first six months of 2013, Veolia has saved 6.15% on its total air travel expenditure. These savings can be broken down to show:

  • a 13% increase in bookings with preferred airline

  • average air sector price savings of $101

  • increased OBT usage for domestic and trans-Tasman bookings.
    Adoption currently sits at 76%

Veolia’s response

“Working with FCm, we have moved from a transactional relationship, initially focusing only on making travel bookings on our behalf, to a partnership. We now take a strategic, collaborative view of travel to identify opportunities, address areas of poor performance and assess strategies to reduce costs. Through this partnership approach, we have substantially improved our travel program through increased compliance and traveller satisfaction, whilst reducing costs, which we couldn’t have done without the engagement and support of FCm.”

Damien Sheehy, Procurement Manage

About Veolia Environnement

Veolia Environnement is the only global company to provide a full range of environmental services for water, waste management and energy. In Australia and New Zealand Veolia works with heavy industry, retail and commercial businesses, governments and communities to deliver innovation and sustainable solutions.

Veolia also helps organisations to reach their sustainability goals by focusing on the core elements of water, waste and energy. Veolia employs over 4000 people across Australia and New Zealand and operates across nearly 150 locations.