From idea and innovative business model to 30 years of success
For thirty years TPE has been energizing the travel purchasing of the future. For thirty years we have been saying that we are not a travel agency, but our member companies’ very own travel function. And for thirty years we have proven that the difference is both measureable and noticeable.
28th of August 2021 marked our first 30 years in a highly competitive and ever-changing market. Since 1991 our unique DNA has been, among other things, that we are the world’s only member-owned shared service center for travel and expense management. We offer a strategic approach to non-strategic purchasing and have gone from offering smarter ways to purchase and manage travel activity and its related expenses to today having a global set-up, delivering our services in 30+ countries to 65,000+ travellers globally who annually spend DKK 695+ million on travel activity (2019).
More than anything our first thirty years are characterised by membership and partnership. And as such our anniversary energizes not only the travel purchasing of the future but also ourselves and our members. Thus our birthday is a welcome opportunity to welcome you into our world and to open a window into who we are, what we can do and how we believe it makes a difference.
From our world to yours – and back again
”In the beginning of the 90s the travel market was in many ways a pretty incredible market, because no one really knew much about it. Even travel agencies were having a hard time gathering usable data. As a friend and colleague and myself began to delve deeper into the issue we noticed that there was a gap in the market for a purchasing association that could systematise the entering into agreements with airlines and hotels, and thus make a real difference by pushing a big part of the agencies’ profit back into the hands of the clients”, begins the initiator of TPE, Søren Schødt, who is still the managing director today.
Very quickly TPE gathered speed. TPE landed a couple of major consultancy jobs with big Danish corporations which moved their travel activity from their external travel agencies to their own travel department. But first it was necessary to thoroughly think through business constellation and business model.
”We looked at different models and pretty quickly decided to go with the co-operative model and member association. We wanted the advantages we would be able to create to benefit the members, because this would help us create a whole new type of transparency and visibility in a market and an industry which was traditionally closed off with regard to for example profit and revenue”.
”This approach made us attractive for an increasing number of companies - and at the same time there was a buzz over a number of years that we had gathered extensive knowledge, which very few, if any, were able to match. As early as 1994 we started doing online booking, which has only become common within the last ten years. And because we insisted on gathering the necessary knowledge via various consultancy jobs, our dependency on various players has been minute from day one. This has provided us, and thus our members, with an extreme degree of flexibility and ability to act much faster than other actors in the market”, points out Søren Schødt.
”Furthermore, volume is worth its weight in gold, and since we already in 1994 had been joined by 7-8 companies, all with extensive travel activity, we were making a big difference economically. We were the first to do 1-to-1 benchmarks on travel economy due to our unique knowledge of the market, and because we chose to be a non-profit organisation, we have always been open about and shared our purchasing data. It provides you with a high level of credibility when your reason for existing is not to grow larger, but to create advantages that are passed on directly to our members”, says Søren Schødt.
TPE has also been good at introducing its members to further opportunities for savings, and today the association’s main business focus is not only on travel management but also expense management. Overall this means that TPE today utilises leading technologies in order to provide a strategic approach to non-strategic purchasing, which means that TPE provides systematic discounts and access to beneficial terms which are always in accordance with current local rules and regulations.
”One of the secrets behind TPE can be found in our ability to innovate. In the way we process develop and design new solutions. And in the way we attempt to innovate our members’ business and the way they think about non-strategic purchasing. We are trained in seeing “ the complete picture” and this totality is unmatched by most”, says Søren Schødt.
Another secret is that at TPE you consistently meet experts who want more. A committed and professionally competent staff who care about their members’ business - and about their success. And who understand how constant changes in the market and in legislation - with new requirements and regulations – put daily pressure on the members’ industries and core business, which means they regularly have to evaluate and rethink their priorities.
”Although through all 30 years we have maintained our focus on our core, which is to create 10-24% savings annually on streamlining purchasing and process optimisation with regard to travel and expenses, we are always ready for and on the lookout for new areas. There will always be a need for rethinking the way companies manage and purchase travel activity, and we are agile enough to adapt and act and react faster than the major players. We quickly acquire new knowledge on for example new EU regulations and ensure that that knowledge can be built into the systems as an integrated part which can be delivered quickly as a complete package”, explains Søren Schødt.
The situation in the wake of covid-19
”TPE has steered solidly through the crisis – For example by trimming the organisation to fit expectations. We have managed to extend our current supplier agreements, so that earlier levels were able to be maintained, and our processes and use of robots for price checks on both flights and hotels as well as supplier terms and relations, have ensured minimal expenses for the members with relation to cancellations and changes on both flights, groups and conferences. We have also provided guidance and help with travel procedures and temporary travel policies as well as security updates before, during and after travels. Furthermore, we have developed a new travel app with exact travel guides which are constantly updated via the app itself + emails and text messages. In short we have kept our finger on the pulse for our members, and this has provided a very necessary sense of comfort in those difficult months”.
”Up next is, among other things, to simplify the processes concerning domestic VAT with detailed VAT itemisation and voucher/receipt approval and an extensive focus on sustainability. Furthermore, new EU regulations require a massive effort - both from us on the developing side and from our members with regard to awareness and readiness. And for those who say in the wake of Covid-19 that business travel will not be as prevalent as before, I can only say that I simply do not believe it. It may be true that we will not be travelling in exactly the same way as before – for conferences and whatnot - but because we are instead interacting in new ways, this will trigger activity elsewhere, which will require us to turbo-charge other initiatives in the next 30+ years”, says TPE managing director Søren Schødt and thanks both members, partners and employees for making it all possible.
TPE’s 30-year birthday will be celebrated with an internal summer and company party for the staff. As Søren Schødt puts it: ”As a member organisation we exist to create money for our members, not to spend it. Therefore we will, as usual, be throwing a summer party for our staff - of course with focus being on the 30 years that have passed - but there will be no lavish reception or anything like that, which would be costly”.