Egencia Opens Fulfillment Centers In India and Switzerland

Egencia today announced that it has opened local fulfillment services in Switzerland and Gurgaon, India, becoming the first of the so-called Internet travel management companies to enter the Indian market.

While Egencia's offering in India should gain traction with multinational clients, domestic and smaller companies may be more hesitant to move toward a predominately online environment, said Mumbai-based PhoCusWright senior director of research Ram Badrinathan. "On the domestic front, it comes down to the culture of a company," he said. "If the company believes that having cash flow of 45 days is more important than automation and data integration, then no amount of automation can change that. There is actually the potential if the culture of the company allows that, because the travelers are very familiar with the ITMC kind of booking model."

The Indian online travel market is a booming segment of the country's travel industry, with 43 percent of air tickets and 10 percent of 30 million rail tickets processed online this year, according to Badrinathan. However, online booking has not permeated managed corporate travel walls, as limited payment options, a customary 45-day payment window and the prevalence of manual processes for invoicing, onsite services and outbound travel visa processing and delivery has kept most transactions offline, he said.

Badrinathan notes that some of the largest IT companies in India have not adopted online booking because of the ingrained predisposition toward these traditional travel management services. "A lot of the TMCs are having to work with a model that hasn't seen the kind of innovation taking place in the leisure spaces," he said.

Badrinathan estimated that, at $3 billion, business travel makes up 12 percent of the total Indian travel market. While the corporate travel segment grew about 25 percent to 30 percent over the past several years, it has scaled down to a 15 percent volume growth rate.

The India location becomes Egencia's third point of sale in the Asia/Pacific region, following launches in China and Australia in the past year. Including Switzerland, the travel management company now has 14 points of sale.