<B> Two More Become CTDs</B>
By Sarah Welt
Two more corporations--Liberty National Life Insurance Co. and U.S. Xpress Enterprises Inc.--have attained certification by the Airlines Reporting Corp. as Corporate Travel Departments. The companies said new travel agency fees resulting from the international commission cap and concerns about overrides influencing their agents to not book the lowest fares prompted them to become CTDs.
U.S. Xpress travel consultant Dawn Pendolfi already has seen savings compared with the way the company used to do business. "In just three days of generating tickets we knew for a fact we were not getting the best options available," she said.
Pendolfi said one traveler was quoted a fare of $917 from Boston to Memphis. "When I offered an alternative flight within one hour of the other, it was $237. The agency didn't even suggest it because most agencies are on an override agreement with an airline." Pendolfi said that ticket sale alone practically paid for the service fee on the Trams back-office system the company bought, which runs about $900 a year.
Liberty National also became a CTD because its agencies began charging service fees, and because it believed its "agents earn a large commission for booking our trips while we were doing a majority of the work in-house. All the agents were doing was forwarding our rooming lists or booking air on the CRS. We felt getting approval as a CTD would make more sense," said second vice president Brenda Martin.
At ARC, director of agency accreditation services Barry Lemley said about 20 corporations in the process of getting approval were spurred by the international commission cap, which caused "a number of corporate travel departments to rethink their arrangements" and hoping to "use the CTD to improve their bottom line."
U.S. Xpress Enterprises got its certification in December, but didn't begin ticketing until Feb. 2, when its CRS, Amadeus, delivered the equipment. It previously used Uniglobe Discovery Travel in Chattanooga, Tenn., for about 90 percent of its business.
When the agency began charging a fee after the international commission cap, "that started us wondering if there was a better way," Pendolfi said. "Paying so much in service fees, we wondered if we should be looking at another travel agency or something completely different."
Pendolfi herself seemed the perfect candidate to head the CTD effort, as she came to U.S. Xpress from Uniglobe Discovery and had 20 years of experience in the travel industry. She estimates the truck carrier, also based in Chattanooga, has an annual travel volume of about half a million dollars, and in 1998 paid more than $5,000 in service fees. She said the in-house CTD can beat the cost while at the same time delivering better service.
U.S. Xpress will continue to use Thor Inc. for after-hours service, but Pendolfi also has installed Amadeus' Homepro in her house so that she can handle late-night emergencies. The company uses car and hotel discounts from the Travel Authority, but has its own corporate discounts with Hertz and Budget as well. Its corporate policy now mandates that all employees book through the corporate travel department, and also asks travelers to consider Saturday night stays and alternate airports.
Liberty National Life Insurance also is consolidating its travel operations and getting a handle on its annual spend for the first time. It had considered becoming its own travel agency in the past, but gave up on the idea as it did not want to be open to the public--until one of its attorneys stumbled upon ARC's Website and learned about the CTD program.
Prior to getting CTD approval in December, it was using four agencies for its $300,000 to $500,000 U.S.-booked air volume. Fifty percent of its bookings went toward its incentive travel program, and were booked through one Oklahoma agency. Martin, previously the company's meeting planner, now heads the CTD operation. She is assisted by three other Liberty National employees.
The department will use the SabreNet platform for booking because it is "more economical than leasing equipment from Sabre," Martin said. It has not yet selected a back-office system, but plans to do reporting internally and is tracking travel manually for now. It does not plan to offer 24-hour service to travelers.
Martin said the biggest challenge in becoming a CTD has been learning the CRS system and ARC's rules. Pendolfi said it was getting the internal invoicing process set up.