Executive Car Service Category Procurement Intelligence Report

Several macro changes in the dynamics of overall Business Travel as well as Executive Car Service procurement trends are poised to change the business practices and procurement thumb rules. As costs rise, companies will be pushed towards finding better cost efficiencies in their travel and entertainment programs. Buyers are leveraging new management tools to analyze the costs using a Total cost of trip/event approach as against cost of an individual trip/event cost item. It is now also expected of suppliers to assess the cost effectiveness of any service they provide from a more holistic point of view.

The availability of advanced technologies has prompted travel and event service suppliers to heavily invest in them to improve efficiencies and customer experience. However, most have learnt that technology alone is not a replacement for the human touch when it comes to customer service. As a result, suppliers are spending on both counts - technology and customer service staff. Till the time a formula for perfect balance between the two is discovered, buyers should expect to bear some of this increased OPEX of suppliers.

With regional and national boundaries blurring in today's corporate world, companies increasingly find themselves with a latent need to bring together geographically distant teams, customers and stakeholders. Therefore, the demand outlook for Executive Car Service is expected to remain strong.

Category managers need to take note of the potential of these developments and reassess the changes required in their procurement practices.

It has become imperative for category managers to remain as agile as possible in terms of their procurement practices. However, it is not always easy to quickly spot and implement alternative practices in a category like Executive Car Service. To help quick decision making, this report advises on several procurement best practices that have worked well for category managers.

For example, Large organizations seek engagement with global category suppliers. However, they must try to achieve the right blend of regional and global suppliers in order to ensure availability of management services at locations where global players do not have necessary capabilities.

Suppliers often charge substantial fees for cancelation and rebooking. Buyers should negotiate for low prices on these aspects to realize direct cost-savings.

It is important for category managers to track and measure the performance of suppliers against a set of defined KPIs that are agreed upon during the contract negotiation phase. The performance of suppliers can also be linked to a portion of their fee that can be paid upon rendering of services in a satisfactory manner. For instance, category buyers should assess supplier performance for adherence to allocated travel budgets.

Executive Car Service procurement managers also need to proactively identify and mitigate potential risks that can arise in the supply chain or contracts for Executive Car Service procurement. Some examples include: