Suzanne Fletcher
Joining Management.travelfor its debut 5Q, Suzanne Fletcher, National Business Travel Association president and CEO, and director of travel, meetings, food service, fleet and transportation for forest products company Weyerhaeuser, discusses challenges facing corporate travel managers.
What is top of mind for travel managers in today's environment?
Regarding companies that rely strictly on a procurement mentality, I worry about whether they lose the in-house travel expertise and management versus just sourcing. Procurement is great, and we can all learn from procurement methodologies, but I would hate to see someone from procurement with no travel background try to decipher the [corporate travel] distribution world. That is another reason why the travel manager is so critical and you cannot just turn it all over to a sourcing group.
Weyerhaeuser has been using the ARC Corporate Travel Department designation for a while now. Any happy surprises or unhappy challenges to report?
The happy surprise is that when we started the process, it was before Sarbanes-Oxley. I feel a lot more secure knowing that we are a CTD now for that very reason. We will be compliant. In the eyes of a Sarbannes-Oxley auditor, we will look better because we have a better handle on accounting and auditing processes, etc. The pleasant surprise is that for once, my timing was right.
It was about a year ago that airlines were adjusting hundreds of corporate contracts in the wake of airfare reform. What has been the lasting effect?
Since [the airlines] realized there were signs of recovery, we have seen our airfares inch up. When the U.S. government came out and officially stated [earlier this year] that the [air traffic] slump is over, that kind of hurt of us. We have seen a 5 or 6 percent increase in airfares. In reality, no matter what these airlines do in setting their fares, if we cannot get the fuel costs in line, you are fighting a losing battle. We, as consumers, have to accept that as a fact of life. We have accepted it when we pay higher fuel prices for our cars. I struggle with why travelers struggle with the fact that airlines may have to raise their fares to cover their cost of fuel. I had an airline rep tell me not long ago that "if we raised every airline ticket $40, we would be in a profitable environment and not have to worry." I told that rep that sometimes I wish they could. It is very nerve-wracking for me. I have about 12,000 travelers ... are they going to get there next week? Are they going to get there safely? Will there be fuel for that airplane? Will they get fed? Is it worth it to me to know that if the company paid $30 more for that ticket, I would not have to worry about that, and nor would my travelers?
Given the strength of the hotel sector, what are you best recommendations to those companies trying to hold the line on their lodging costs?
After the sticker shock of negotiating hotel agreements this year, what I really looked for--since I knew I wasn't going to get great rates--was total value. Did it include the perks? Did it include last-room availability? Since the prices did go up, those are the things that allow me to justify it, some way, somehow. Certainly we tried to reduce our number of properties. We as a company have always negotiated the lower tier and mid-tier because of our locations. We are literally out in the woods. You do not see a lot of Ritz-Carltons in Pine Hill, Alabama. The other thing is that we have to work to ensure these negotiated rates are loaded. Because 99.9 percent of their work comes in the last six weeks of the year, what a lot of the chains did is they went in and pre-loaded rates, under the assumption that I am going to pick their hotels. That's fine for the ones that I picked in the past, but when you take a chain and they pre-load every single one of their properties, and at Jan. 1 flip a switch, and I've got 8 million squatters, it takes forever to get them out. I understand that they want to be proactive, that they want to have some of that work already done, but that was probably my biggest heartburn over the last two years--getting rid of these squatters. And it is just because that year-end crunch is tough on hotels. My attitude is "fine, then work a deal with me every two years." But you cannot get a hotel to commit to that.
Like airfares and hotel rates, we have been hearing a little more about increased car rental costs, which do not always get the same level of attention. What trends are you seeing?
Certainly [car rental companies] are raising their prices. Who isn't? That is not earth-shattering news. The real news in the car rental world are the taxes. They are killing us as an industry. At NBTA, it is a huge issue for us. The car rental companies don't really have a lobbyist, so we are working collectively to see how we can fight these taxes as a group. As an example, Las Vegas is trying to institute another tax on rental cars to help support their culinary school. And I think it was Charlotte that increased their car rental tax to help with their art museum construction. The attitude on the local level when they roll out these incremental taxes is that "it is not really important because the local people are not being affected by it." Well, that is a lie. If Seattle implemented an incremental tax, it is our travelers coming to this city, so I do pay for it. My company pays for it. Seattle is our number one destination, so if Seattle added a $2 or $3 tax to help build a new stadium, it may not affect voters and constituents in the region but it does affect companies that are located there.