Unit 10 – P4, M1 & D1

Review the current factors affecting business travel (P4) 
explain how factors are currently affecting the business travel environment and operational practices (M1).  
discuss how the current business travel environment and how business travel agents are responding to current challenges (D1)

Global economy:
Strong economic growth and healthy overseas trade increase. There is also emerging economies in the Middle East (India and China); during 2006-2007 there has been a 3.1% increase in business travel as more people are travelling for business purposes.
However the recession has made business travel decrease as there is an increase in fuel charges and makes flying more expensive. Businesses have also made budget cuts and cut out unnecessary transport and transfers.
The exchange rate also affects the global economy as if the pound gets devaluated; business people will not want to travel to the UK as it will work out expensive
. Travelodge sales have increased by 63% in the last three years, this shows that business companies are obviously booking their employees into lower-cost accommodation. Hilton hotels are also offering rooms at lower rates as they are competing with the cheaper hotels for the custom.  Since the recession, business people are more likely to connect other colleagues in different branches/ locations via some form of technology.

Technology (web and telephone conferencing, e-meetings and web based seminars):
Telephone conferences are meetings where participants dial into a distributed telephone number and they can all hear each other. You may add your name as you contribute to the conference.
Web conferences take place all over the internet and can incorporate sound and cameras or just talk by basic live messaging. E-meetings are very similar as it allows people to communicate over the internet. Web seminars – tutor and delegates are on-line at the same time and follow resources.
Business travel fell by 6% in 2006 due to more business clients talking over the internet and the improvement in technology is affecting business travel operations.

Merit:
Technology has affected the business travel operations as they are losing customers as more business workers can have meetings with other people in different locations without having to leave their office, meaning business travel agents are not getting as many bookings causing them to lose out on money. Also the other cause of improvement of technology is that the staff or their personal assistants can use their computers/ smartphones to book the business trips
. This could cause business travel agency to go out of business if they cannot afford to keep staff and a have premises. Technology is affecting the business travel environment in as it more accessible to easily research locations of business meetings, hotels and their amenities and facilities, review flight confirmations and timings. The improvements in technology mean that is easier for the business customer to request a booking via the internet or by an email meaning the business customer/ the personal assistant does not have to go down to where the travel agents are located in the office building and can carry on their work.

Terrorism: 
Terrorism always has a short term impact on travel, the impact normally last for 4-6 months and then normal behaviour returns. When the London bombings occurred, the capital was only affected by a short period of time.  Terrorism is a factor that always affects business travel agents as, if there is a terrorism act, the reason for the business trip might get cancelled or rearranged to a safer location meaning that the agents may lose out on money if the second destination is cheaper or have to turn away other customers if they are amending the other customers details.
Even though the London riots is not an act of terrorism, it was one of the biggest travel disruptions in 2011 due to the fact the UK authorities was not prepared for that size attack and the amount of fire and violence occurred. Travel services were disturbed for fears it was under threat/ could be a hazard. Business customers who would be travelling into the UK and especially London for a business event would be cancelled as the safety of the customer is unsure.

Health epidemics:
Health problems will stop people from entering the destination. In 2003 (SARS) Severe Acute Respiratory Syndrome stopped travel to Hong Kong also the Swine Flu pandemic in 2009 resulted in temporary restrictions on travel. World Health Organisation (WHO) issues travel advice regarding epidemics.
Health epidemics affects business travel as it quite frankly stops business people from travelling to countries where they might need to attend for work related purposes.

Merit: Health epidemics affect the business travel environment as business workers are not allowed to travel to areas where an important new customer offering a product is holding a conference but no one can attend it.  Health epidemics also affect operational practices as the business agents have to amend lots of bookings or turn important clients away as they only specialise in business products and services in certain locations. Ebola affected the business travel environment as business employees were not allowed to travel to Guinea, Liberia and Sierra Leone because that is where the main outbreak of Ebola was. This affected the African business environment as there were a high number of reduced flights to those three destinations and could possibly been a loss of business trade.

Political unrest:
political unrest is when a country may erupt into violent demonstrations and create dangers to travelling. If a country is known to be unstable, the UK government will advise against travel to the area. If there is political unrest in a country, business people will be told they cannot go to the destination as it is unsafe, so if a business travel agency specialise in a certain country, they will not get any money/ customers coming in.
At the beginning of May, over four hundred people were arrested in Burundi, Africa due to clashes between the protesters and the police. They are creating political unrest as they did not want the current president to run for the third term. Seven people died and 66 were injured during the first six days of the protest.

Merit:
 political unrest is a factor that affects business travel extremely, as the locals who maybe rioting (if access to the country is allowed) find it hard to walk around the town in case they get hurt or worse. On most occasions of a political unrest, entry into the country is forbidden, and any business workers in the country/ location who are from somewhere have to contact the business travel agent to make them bring the transport to an earlier date. It affects the business travel environment because it means less business customers are going to be travelling to the location where there is political unrest is occurring and it may take a few months or maybe years to get the location appealing for business customers to travel to.

Distinction One
The current business travel environment is stable and is growing year on year. There is a high yield in business travel (money gained is more than money spent).  Business travel is worth £16 billion (2014).
Even though it was over ten year, in 2001, the spending by business travellers was higher than leisure travellers.  This proves that business travel was popular back in times before the recession hit.
When the recession hit, business customers affected the travel environment the most as in 2010, a quarter of the high demands for flights were slashed as business workers were not flying away. The main flight paths that were affected was from the UK to anywhere in the EU. The recession also made business customers to fly economy rather than business class. Ryanair also cut cost of all flights by 20% in order to sell flight to customers by offering lower prices than other flight companies.
For some reason, last year the figures for business travel from China to the UK dropped by 13%, 7000 less people came to the UK than in 2013 for business purposes. The United Kingdom travel industry has listened to the complaints of business groups and has created a fast track scheme (included China) to pay for a 24 hour turnaround visa.
Business customers may be able to conference call other business/ different locations of the same business/organisation but sometimes the employees need to do training and courses so will have to travel around a lot for that or one person from a different branch will spend a month in another branch and travelling back on weekends.


Business travel agents are responding the current business challenges in many different ways. The agents are responding to the global economy by booking the business customers into lower class flights (economy class), having a lower budget for hotel stays (cutting down the amount that can be spent per night) some customers may even be booked into lower class hotel chains e.g: Travelodge and Premier inn as they still offer business facilities (Desk to work on and pay for Wi-Fi). The business customers may also be booked onto lower cost airline companies (Ryanair) as it is cheaper and the agents can get deals and contracts with the company to offer the best rates to the business customers and allows them to carry on in the tourism industry. Ryanair is the top low cost airline company that business customers use and enjoy the products and services the airline offers.
The services business travel agents offer to the business customer when planning and booking itineraries may alter; have lower cost car hire/ private transfers as they can have a lower model car which still does the same job but can help with the overall travel budget for the company.

Business travel agents are responding to the improvements of technology by making sure they can offer better deals for customers. They have also responded by improving their global booking system, for when a business customer is in a different location they can phone up the agents if amendments to their itineraries are required.
However, there is an increasing negative side for business travel agents against technology because it means it is easier to book travel products and services on websites and just selecting business/first class. The employees can do it their selves or if they have a personal assistant, they will book the business travel products and services required putting the agents out of work. Maybe in the future there will be no call for business travel agents to be placed inside the office building and resort to becoming an e-agent.