It’s a tough job, creating, agreeing and managing your travel contract. A travel management contract can be critical to employee experience and is often a strategic category depending on your business.
I’ve seen this from both sides. I was once Head of Procurement for a Premier League football club, so I understand the pressure of getting players and coaching staff where they needed to be - on time, safely, and without fail. Now I’m on the other side of the contracting fence, and I understand exactly what organisations need from a travel contract. Travel isn’t simply about logistics, it’s business continuity.
Appointing a Travel Management Company (TMC) can be emotive, as there’s more to consider than people think. You’re buying experiences, reliability and time. So how can you make sure your contract delivers, whilst reducing risk and reviewing opportunities for commercial value
Understand the nature of the agreement
It’s important to remember that your travel contract isn’t a standard services contract, it’s an agency agreement. The TMC act as your agent, arranging travel on your behalf. Travel costs are passed through to you, typically with a booking fee added by the TMC. This distinction matters because it impacts liability, risk allocation, and service expectations
Five things to consider before signing
1. Engage the right stakeholders early
Successful implementations begin with stakeholder engagement. If travel technology needs to integrate with existing systems, involve IT, finance and change management teams from the start. Frequent travellers and bookers can also provide valuable insight into current pain points and user experience challenges.
2. Understand your data
Your travel data can reveal valuable patterns and opportunities. A prospective TMC will want to analyse historic travel activity to identify trends, efficiencies and areas for improvement.
Consider how your data can be cleansed, standardised and securely shared to support meaningful analysis and informed decision-making.
3. Make sure your travel policy supports your objectives
Your travel policy remains one of the most effective tools for controlling costs and influencing behaviour.
A TMC can identify savings opportunities, but it is your policy that ultimately shapes booking decisions. Clearly define expectations around class of travel, hotel standards, daily rate caps, approval workflows and meeting alternatives. It's also worth considering whether any existing processes create unnecessary friction for travellers and bookers.
4. Review the key contractual clauses
Ensure the agreement clearly states that the TMC is acting as your agent for the purpose of booking travel services.
Liability caps should also be proportionate to the value of the services provided by the TMC and should exclude pass-through travel costs wherever appropriate. This helps ensure risk is fairly allocated and avoids unintended exposure to costs that sit outside the TMC's control.
5. Understand payment terms
Travel operates differently to many other procurement categories. Suppliers often work to industry-specific settlement and payment arrangements, which can affect the credit terms available.
If extended credit terms are important to your organisation, discuss these requirements early in the procurement process to ensure expectations are aligned
Defining service levels: What really matters
Service Level Agreements (SLAs) play a crucial role in setting expectations and measuring performance.
Effective SLAs should focus on areas within a TMC's control, such as response times, booking accuracy, traveller support and disruption management. External events such as adverse weather, airline operational issues or industrial action should be considered separately, as these are beyond a TMC's direct control.
You should also consider whether your organisation requires a dedicated service team, account management support or access to out-of-hours assistance for urgent travel issues.
Increasingly, organisations are also looking beyond traditional operational measures to understand traveller satisfaction, service quality and the overall effectiveness of their travel programme. While these measures may sit alongside formal SLAs rather than within them, they can provide valuable insight into supplier performance and opportunities for continuous improvement.
Clear and measurable KPIs are essential. These may include online booking tool availability, call response times, booking accuracy and traveller satisfaction, providing both parties with a transparent framework for performance management.
Defining meaningful service measures is often more valuable than simply measuring more things. What good looks like, how performance should be assessed and the role of service governance are topics we'll be returning to in a dedicated
Management information: Turning data into decisions
One of the most valuable aspects of a TMC partnership is the management information it provides. However, organisations should look beyond standard reporting and focus on receiving data that supports operational control, governance and ongoing improvement.
A good reporting programme should provide a consistent source of truth across travel activity and expenditure, enabling businesses to make informed decisions with confidence.
Useful insights may include:
- Booking behaviour, including booking horizons, online adoption and policy exceptions
- Policy compliance across class of travel, hotel standards, rate caps and approval processes
- Service performance against agreed KPIs and SLAs
- Savings opportunities, such as advance purchase recommendations and utilisation of negotiated supplier rates
- Travel trends and supplier usage patterns that can support future sourcing decisions
For many organisations, travel reporting now extends beyond spend and policy compliance to support wider finance, sustainability and traveller experience objectives. Defining those reporting requirements early can help ensure the right data is available when it's needed.
The goal should be to transform travel data into actionable intelligence that improves compliance, supports governance and identifies meaningful savings opportunities.
Final thoughts
Travel disruption is inevitable. Whether caused by adverse weather, air traffic control issues or supplier operational challenges, unexpected events will occur.
A well-structured contract, supported by clearly defined service levels, robust reporting and strong governance, helps ensure your organisation can respond effectively when disruption happens.
Taking the time to get the contract right from the outset will not only reduce risk but also help create a travel programme that delivers value for both the business and its travellers.
Of course, selecting the right TMC is about more than contracts, SLAs and reporting. Organisations are placing increasing focus on areas such as sustainability, traveller experience, programme governance and continuous improvement. These are important topics in their own right and deserve more than a passing mention, so we'll return to them soon as part of our wider travel management series.
For more advice on partnering with an award-winning travel management company, contact the our expert team and we’ll be happy to help
