Radius has expanded across borders and improved its corporate travel focus with new partnerships in Argentina, Brunei, China, Japan and Mexico, officials said. The partner in China is the well-known, publicly traded Ctrip.com International, which has stated that one of its key strategies is to "further develop" corporate travel services launched in 2006.
Radius president and CEO Chris Vasiliousaid the nearly $10 billion, Shanghai-based company manages "quite an impressive list of corporate clients globally and has a fantastic mix of understanding Western, Chinese and Asia-Pacific business practices."
China Hospitality Newsin February 2009 reported that Ctrip.com had more than 300 "major" corporate clients "including Panasonic, Sony and Ericsson." When announcing Tuesday its first-quarter earnings performance, Ctrip said it was one of the top three corporate travel management companies in China and that corporate travel revenues for the first quarter of 2010 were RMB26 million (US$4 million), "representing a 99 percent increase year-on-year, primarily driven by the increased corporate travel demand from business activities and lower base in the first quarter of 2009." Corporate travel management revenues "primarily include commissions from hotel reservations, air ticket bookings and packaged-tour services rendered to corporate clients," according to the company.
Ctrip is expecting 35 percent to 45 percent year-over-year growth in corporate travel revenue in the June quarter, officials said. Corporate travel in 2009 drove no more than about 3 percent of the company's total revenue, said officials.
Radius will retain its partnership with China CYTS Tours Holding Co., which is based in Beijing. "There are very few markets where we have more than one member, but it makes sense in markets like the U.S. and China that are geographically large with complex travel models," said Vasiliou.
In Japan, Radius replaced a former leisure-oriented partner with H.I.S. Experience Japan, which Vasiliou called the second-largest Japanese travel company after JTB. "We have always been looking for the right mix of a company in Japan that not only is in the leisure space, which they all are, but also has a very strong global corporate capability," he said.
"What we do at this stage is we send an implementation team to their offices and it takes a couple weeks to implement the connectivity so we can capture all the data driven by our corporate clients to those locations," Vasiliou said when asked how long it would be before these new partnerships are active. "The flip side is, now Ctrip and H.I.S. can sell corporate business in their home markets and be serviced by Radius outside their home markets. There is no center of the model, versus the other global TMCs where they're the center of the model and most of the business is flowing outward. What makes Radius different is that the members use the network to service their global customers, and Radius does the global component of that, which is the IT, the reporting and account management."
Now in 80 countries, Radius is expecting to handle about $450 million in corporate travel volume this year, up from $100 million in 2008, Vasiliou said. "That's business contracted by Radius and distributed through the network," he said. "It's not an aggregation of what the members do." Some members, for example, generate as much as 30 percent of their business through partner-to-partner deals, which may not require the global services offered by Radius centrally. Some of the roughly 50 corporate clients that Radius does service centrally are using its members in more than 30 countries, officials said.
Clients include BlackRockand Lockheed Martin through the Radius partnership with Travelocity Business.
A new partner in Brunei will bring the Radius brand there for the first time, while the network at press time was nearing an announcement of a new Mexican affiliate. Additionally, Radius last week announced $60 million agency TTS Viajes of Buenos Aires as a new member.
While Radius has long had partners in Argentina and Mexico, Vasiliou said their replacements were better equipped to support the network's "more sophisticated and complex" corporate travel model. "We're regularly going up against the mega TMCs and are viewed as an alternative to the mega model," said senior vice president for marketing and business development Nicholas Stafford.
Separately, Radius this month announced a multi-year global data reporting agreement with TRX.