Cadbury Consolidates Travel Biz With McGregor.

<FONT SIZE="+3"><B> Cadbury Consolidates Travel Biz With McGregor</B>

By Mary Ann McNulty

<I>Dallas </I>- Guzzling down new beverage lines like 7Up, Dr Pepper, A&W Root Beer, Sunkist and Mott's, Cadbury Beverages Inc. had no time to develop single travel policies, consolidate with one agency or even compile total travel spend. That's about to change with the company's selection of McGregor Travel Management to consolidate more than $10 million in expected air volume.

Recognizing the inherent service problems in operating with separate agencies and service standards-not to mention the lost savings-Cadbury's former director of training and development, Betty Losi-Sherwood, had encouraged management to consolidate. Within nine months, Cadbury selected Stamford, Conn.-based McGregor as its agency, tapped Losi-Sherwood as the company's new corporate travel manager and began formulating a single travel policy.

The selection of McGregor, which took over the account about two months ago, shows that service concerns can level the playing field for such super-regional agencies when corporate buyers are choosing a travel management firm.

The acquisition of Dr Pepper Co./The Seven-Up Co. in March 1995 left the new company-Dr. Pepper/Cadbury North America Inc.-with two headquarters, one in Stamford and the other in Dallas. Stamford and a Trumbull, Conn., operation were served by Chartrek Travel, while the Dallas office was served by an on-site office of American Express. Field sales representatives used their own agencies.

"Using two agencies didn't seem to be financially intelligent," Losi-Sherwood said. "We needed to maximize our buying power and pick one agency to handle all acquisitions. We needed consistency and a cohesiveness."

Service Takes Priority

The company went out for bid in the fall of 1995. "Service was the number-one priority for Cadbury," Losi-Sherwood said. "Dr Pepper was serviced OK, but the service level would not have met the expectations of the Stamford operation." Concerned that the account couldn't get the personal attention it needed from a mega agency, Losi-Sherwood opted to ask six agencies-two megas, two super regionals and two regionals-to bid on her business. Consultant Tom Wilkinson of Travel Management Group, Alexandria, Va., was called in to help Cadbury evaluate agency bids. Three agencies, including incumbent American Express, were selected to make formal presentations to Cadbury's board of directors.

In early February, Cadbury signed a co-managed partnership agreement with McGregor and began plotting a 90-day implementation plan. Key factors in McGregor's selection included its track record in consolidating accounts and running an on-site, international experience-37 percent of Cadbury's business is international-and ability to provide necessary management information.

"What I found with McGregor is that they demonstrated the ability to be flexible and understand the corporate cultures of both companies," Losi-Sherwood said.

Another key factor for Losi-Sherwood and Cadbury executives is the fact that the beverage firm would be one of McGregor's top five accounts. Bristol-Myers Squibb is McGregor's largest account with air volume of over $55 million (<I>BTN</I>, Oct. 16, 1995).

Involvement From The Top

Company executives were impressed that the owners of McGregor were involved in the start-up of the relationship, and that the account manager worked so closely with Losi-Sherwood on automation and equipment to make the on-site agency more productive.

Crews knocked down walls in the existing on-site location in Dallas to build a larger, more efficient travel operation. The company installed a new telecommunications system capable of tracking wait time, abandoned calls and other statistics necessary to determine service levels. To staff the facility, McGregor hired several agents and scheduled two weeks of training for the 11 reservationists and two processors.

To communicate the changes to employees, Cadbury scheduled seminars in each location in April and sent memos.

McGregor, which will operate through an on-site at Cadbury's Dallas office, expects to begin consolidating the sales force in July. Eventually, the agency also expects to book travel for operations in Canada, Florida and elsewhere.

Early results indicate that the employees are happy with the consistent service levels of the new on-site, Losi-Sherwood said.

In September, Cadbury plans to formally conduct a survey of its 1,000 frequent travelers about the service they receive from McGregor.

Although Cadbury does expect to gain financial benefits, Emily Roos, manager of new business development at McGregor, said it would take time.

"It will be difficult to make certain measurements in the first year because we don't have facts on all pieces of the business," she said. "It's an evolution with a lot of growing to do.